What Impact Do Services Like Airbnb Have On Homeowners' Insurance?

Airbnb and other vacation rental websites are a terrific way for budget-conscious travelers to explore the world and for homeowners to earn money while away. These popular sites are beneficial for both tourists and hosts. However, it is important to note that having paying guests in your home or staying at someone else's residence can affect the property's insurance. If you've considered renting out your house to generate additional income, or if you're staying at the home of someone who does, here's what you should know about the needed level of homeowners insurance.

Injury Protection

As part of your liability coverage, your homeowners or renters insurance may cover circumstances in which guests are hurt on your property. This policy protects you against lawsuits from an injury on your property. As a tenant, renters' insurance will protect you from liability and property damage, as your landlord's insurance often only covers the structure of your home and not its contents.

If you are concerned about your amount of coverage, check with your agent to ensure that the property is covered by liability insurance. Before renting your house, you must clarify this with your agent, as policies vary from company to company, and limitations for rental risks may apply.

Property Loss

Suppose your homeowner's or renter's insurance covers property damage caused by a short-term renter, such as an Airbnb guest. In that case, your insurance provider may reimburse you for the property's worth. Check your insurance coverage before becoming a host, as a renter damaging or stealing your property may not be deemed a "covered danger." Inquire about particular situations with your agent, and be careful to send a confirmation email so that you have the written response should a claim occur. Generally, the more inclusive your policy is, the greater the likelihood it will cover damage caused by paying guests.

Some insurance companies need advance notice if you plan to have a paying visitor in your house, and you may be required to acquire additional insurance if you intend to rent out your home regularly. Suppose you intend to rent out your house for an extended period. In that case, you will likely require a specific landlord policy, which may increase the cost of your initial homeowner's insurance policy. Check with your insurer, as policies may vary. For additional details, please visit nolo.com.

In the event of a theft or fire on the house, you're renting out, damage to a guest's property is likely not covered by your home's insurance policy, so they will likely need to rely on their own insurance. Ensure that your guests know the extent of your liability and insurance coverage.

With so many alternatives for hosts and guests, this is a fantastic moment to utilize hosting services like Airbnb. But before you do so, ensure that you are protected. Discuss all available choices with your real estate agent.