Airbnb insurance

Renting out a room on Airbnb, or via another short-term letting site, can be a good way of making some extra money. But what are the implications for your home insurance? Let’s look in detail at what you need to know…

Renting out a room on Airbnb, or via another short-term letting site, can be a good way of making some extra money. But what are the implications for your home insurance? Let’s look in detail at what you need to know…

Andy Webb
Insurance expert
5
minute read
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Posted 9 DECEMBER 2021 Last Updated 14 MARCH 2022

Can I rent out my house on Airbnb?

Before renting out a room, or your entire home, through Airbnb, there’s a few things you need to check.

  • If you’re living in a rented or leasehold property, make sure you check the terms of your agreement to find out if there are any restrictions around sub-letting your home.
  • If you own your home but are still paying off a mortgage, check the terms of your mortgage agreement to see if it allows you to rent out your home. It’s essential to do this, as breaching your contract could result in penalties or even having to immediately pay your entire mortgage balance – which is obviously not manageable for most people.
  • Check with your local authority for any restrictions on short-term lets. In London, for example, you can’t let a property on a short-term basis for more than 90 nights in a calendar year without planning permission.

Once you know you can become an Airbnb host, you need to make sure you’re covered by buildings and contents insurance.

Will my regular buildings and contents insurance cover me as an Airbnb host?

Short-term rentals present additional risks, so don’t assume your existing buildings and contents insurance will cover you.

Start by telling your home insurance provider what you intend to do. If they learn that you’ve become an Airbnb host without informing them, they may invalidate your entire policy, which means it won’t pay out if you need to make a claim.

Whether you’re renting a room in your home or renting your whole property – while you go on holiday, for example – your home insurance provider may allow you to extend your policy so that you’re covered for Airbnb guests.

As with any type of insurance, different providers have different terms. For example, there could be restrictions around how long you can rent your home for or how many guests you have. In any case, you’ll pay an additional premium to extend your policy.

It’s possible, however, that your provider will refuse to cover you. If this is the case, you may need to look for specialist Airbnb cover.

If you’re renting out a property that isn’t your main home, holiday home or second home, landlord insurance may give you the cover you need, but you’ll need to look at policies in detail to make sure.

Does Airbnb provide its own insurance?

Airbnb provides hosts with AirCover, which includes:

  • USD $1 million (approximately £750,000) liability insurance – to cover you if a guest gets hurt or their belongings are damaged or stolen during an Airbnb stay.
  • USD $1 million host damage protection – to cover your belongings. The company makes clear that this isn’t an insurance policy and not all damage is covered.
  • Pet damage protection.
  • Deep cleaning protection.
  • Income loss protection – if you have to cancel bookings because of damage.

However, as Airbnb say themselves, AirCover is not a substitute for having your own insurance. So you need to talk to your provider to make sure you have the cover you need.

Do I need specific insurance to use Airbnb?

Insurance providers may offer policies for holiday lets and short-term rentals, but it might not be specific to Airbnb (as there are other short-term letting companies you could use). Read the wording of the policy very carefully to make sure it provides the cover you need.

Before you look for specific insurance, ask your existing home insurance provider if you can extend your current policy.

What insurance do I need for Airbnb?

As with any home insurance policy, you’ll want to consider:

  • Buildings insurance This can cover your physical property (the bricks and mortar). If your Airbnb rental is a leasehold flat, the freeholder will probably be responsible for buildings insurance, but you’ll need to check.
  • Contents insurance Offers cover for your personal belongings against loss, theft or damage. Airbnb’s AirCover will cover contents damaged by a guest but not damage from other causes.

You might also want to consider:

  • Home emergency cover Could cover you if you need to call out emergency assistance to an Airbnb property. For instance, if there’s a burst pipe.
  • Liability cover To cover the costs of compensation in case a guest or another visitor is injured on your property.
  • Loss of booking income This could be useful if you need to take time away from running your Airbnb following an event covered by the policy, like a fire. Always check the terms and conditions of your policy, so you know what you’re covered for.

As ever, it’s important to shop around to find the right quote for you.

Is Airbnb insurance the same as holiday home insurance?

Holiday home insurance is usually for a second property. It may cover Airbnb lettings but, as with all policies, you’ll need to check to see that if gives you the cover you need.

Airbnb insurance is used to describe specialist insurance that’s usually, but not always, for your main home. But different providers use the term in different ways, so check the detail of the policy.

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At Compare the Market, we don’t provide quotes specifically for Airbnb insurance, but we can help you find the right home insurance for you. Start comparing today.

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