Renting out a room on Airbnb or through another short-term letting site can be a good way of making a bit of extra money. But what are the implications of Airbnb hosting for your home insurance? Let’s look at what you may need in detail...
Will my regular buildings and contents insurance cover me as an Airbnb host?
Before you become an Airbnb host, you’ll want to make sure you’re covered by home insurance. You can’t assume your existing home insurance will cover you, so check the policy carefully.
Business activities and short-term rentals present an additional level of risk that may not be underwritten by your existing insurance.
If you suffer damage or theft as a result of an Airbnb stay, and you haven’t taken out the right form of insurance, your claim might be invalid.
And if your home insurance provider learns that you’ve started running an Airbnb without telling them, they may invalidate your entire policy – leaving you without any form of insurance.
That’s not to say you can’t add Airbnb cover to your current policy. Before taking out specialist insurance, contact your current home insurance provider(s) to see if you can add Airbnb insurance to your existing policy.
Doesn’t Airbnb provide its own insurance?
Airbnb provides Host Protection Insurance and a Host Guarantee. However, these are not comprehensive forms of protection and there are many things they won’t cover you for.
Host Protection Insurance is intended to provide the minimum level of coverage for hosts and guests in the event of accidents in your home. Airbnb offers up to USD $1,000,000 (around £750,000) for claims related to ‘bodily’ injury (physical injury to someone in an Airbnb).
While Host Protection Insurance covers you, the host, against injuries to guests and third parties caused by accidents within your home, there are several things it won’t cover you for. For example, it won’t cover you for intentional damage or personal injury, or issues with the property (mould or asbestos, for instance) that cause health problems to guests.
Neither will it cover you for loss of earnings if you suffer damage to your reputation or need to take time away from your hosting responsibilities to pursue legal action. For these and other considerations, you’ll need your own separate insurance policy.
The Host Guarantee provides up to USD $1,000,000 of property damage protection. It’s designed to help if a guest is unwilling or unable to pay for damage. But it doesn’t provide cover for any cash you have in your Airbnb. The Host Guarantee isn’t an insurance policy, and the company urges hosts to buy insurance to cover losses that aren’t within its scope.
Do I need specific Airbnb insurance?
You might not need specific Airbnb insurance. A few brokers offer a special policy for holiday lettings and short-term rentals. It might not be called ‘Airbnb insurance’, so you should read the policy wording very carefully to make sure it provides cover for the things you need.
First, check with your existing home insurance provider to see if they’ll give you Airbnb cover.
What insurance do I need for Airbnb?
It all depends on you, your home and what you’re offering on Airbnb. However, as with any home insurance policy, you should consider insuring both the property itself and your contents.
Ask yourself these questions:
- What is the value of my home and contents, and how much cover do I need?
- How often will I be hosting guests and what’s the maximum number of guests who could stay at any one time?
- How much of my property will guests have access to? One room or the whole house?
- Will guests have access to any other parts of the property, like the driveway and garage, the garden or the swimming pool?
Once you’ve answered these questions, you’re ready to start shopping for a quote.
What other types of insurance might I need?
Airbnb’s Host protection and Host Guarantee can offer some protection, but to fully cover your property and its contents, you’ll want to look at:
- Buildings insurance, which can cover your physical property (the bricks and mortar) against significant damage resulting from a guest causing damage. For instance, if they start a flood.
- Contents insurance. This can cover your personal effects against loss, theft or damage. This might also include items in rooms of your house that are off-limits to Airbnb guests, like your own bedroom.
You might also want to consider:
- Home emergency cover, which could cover you if you need to call out emergency assistance to an Airbnb property. For instance, if there’s a burst pipe.
- Liability insurance, which could cover you if your guest(s) cause injury or damage to a third-party or property. For example, if they accidentally drop something out of your window onto a person in the street.
- Loss of booking income. This may be useful if you need to take time away from running your Airbnb to settle a claim. It might also be useful if you suffer loss of income following an event covered under the policy, like a fire. Always check the terms and conditions of your policy, to know what you’re covered for.
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, while Airbnb insurance may be needed to cover your primary residence – for instance, if you’re renting out a spare bedroom.
Holiday home insurance is also typically intended to cover second homes that are routinely left unoccupied for whole seasons (30 days or longer). But, as an Airbnb host, you may need to rent your home out at a moment’s notice.
But both holiday home insurance and Airbnb insurance may offer you cover if a guest is injured, if you suffer loss of earnings, if the property itself is damaged, or if your contents are lost, stolen or damaged by a guest.
Start comparing home insurance
At Compare the Market, we don’t provide quotes specifically for Airbnb insurance, but we can help you find the right general home insurance for you. Start comparing today.