What insurance does a short-term rental host need?
Short answer
Most hosts need coverage written for short-term rental use, because standard homeowners and dwelling policies often exclude or limit coverage for business activity like paid stays. Airbnb's AirCover for Hosts adds damage protection and liability insurance for Airbnb stays, but Airbnb says it is not a substitute for your own insurance. Confirm your coverage with a licensed agent.
The basics
This guide explains the main types of coverage in general terms. It is not insurance advice, and policies vary by insurer, state and home. Talk to a licensed insurance agent about your own situation before you host, and get answers in writing.
Three layers usually come up for a short-term rental host:
- Your own property policy, such as homeowners, landlord or a policy written for short-term rentals.
- Platform protection, such as Airbnb's AirCover for Hosts, which applies only to Airbnb stays.
- Extras, such as umbrella liability or flood and earthquake coverage, which some areas need.
Why a homeowners policy may not be enough
The National Association of Insurance Commissioners says that "most homeowners or dwelling insurance policies are not designed to cover accidents arising from short-term rentals." (opens in a new tab) It adds that homeowners policies usually exclude or limit coverage for running a business in the home, and that listing often may be treated as a home-based business.
The Maryland Insurance Administration makes similar points for consumers. It says a homeowners policy may not cover (opens in a new tab) damage caused by a paying guest or liability if a guest is hurt, and that a second-home policy may not cover damage while the home is rented out.
Options the NAIC describes include adding coverage to an existing homeowners policy, on-demand coverage where available or a landlord policy. Which one fits depends on whether you live there, how often you rent and what your insurer offers in your state.
What AirCover for Hosts is and isn't
AirCover for Hosts has two separate parts. Airbnb says that "Host damage protection isn't related to Host liability insurance." (opens in a new tab)
| Host damage protection | Host liability insurance | |
|---|---|---|
| What it is | A reimbursement program. Airbnb says it "isn't an insurance policy" (opens in a new tab) | Insurance underwritten by third-party insurers (opens in a new tab) |
| Limit | Up to $3 million (opens in a new tab) | $1 million (opens in a new tab) |
| What it covers | Guest-caused damage to your home and belongings, certain extra cleaning and lost income if you cancel bookings because of guest damage | Your legal responsibility if a guest or others are hurt, or their property is damaged or stolen |
| Not covered | Normal wear and tear, acts of nature, injury to guests or others, normal checkout cleaning | Intentional acts. Damage a guest causes to your own place falls under damage protection instead. Other exclusions apply |
| Applies to | Airbnb stays only | Stays booked on Airbnb. It also covers people who help you host, such as co-hosts and cleaners |
A few details from Airbnb's pages that matter in practice:
- Not a replacement. Airbnb says AirCover for Hosts is "not a substitute for personal insurance" (opens in a new tab) and suggests asking your insurer how your policy overlaps with it.
- Guest first, then Airbnb. The Host damage protection article (opens in a new tab) says to file a reimbursement request in the Resolution Center within 14 days of the guest's checkout. Under the Host Damage Protection Terms (opens in a new tab), you must try to recover the amount from the guest within 14 days of checkout and submit the payment request with evidence within 30 days.
- Excluded losses. The same terms exclude wear and tear, mold and most business interruption. They also treat cash and securities as ineligible. Payments are reduced by anything you already received, including from an insurance policy.
- Liability is automatic. Airbnb says liability coverage applies automatically (opens in a new tab) whenever you host a stay booked on Airbnb, and the article does not say whether it pays before or after your own insurance.
Because AirCover only applies to Airbnb stays, bookings from Vrbo, Booking.com or your own site are outside it. Ask your agent how those stays are covered.
What short-term rental policies offer
Some insurers sell policies written for short-term rentals. Two examples, with facts only from their own pages. We do not rank or recommend insurers, and neither pays us.
- Proper Insurance (opens in a new tab) says it serves short-term rental owners and Airbnb and Vrbo hosts in all 50 states and Washington, DC. Its policy is a commercial policy meant to replace a homeowners or landlord policy. It lists building and contents coverage, commercial general liability with a $1 million standard limit, business income, guest-caused damage, bed bug protection and squatter protection, underwritten through Lloyd's of London and Concert Specialty Insurance Company.
- Steadily (opens in a new tab) says it offers short-term rental insurance for landlords in all 50 states, with "damage and liability coverage for Airbnbs and VRBOs." Its coverage menu names four coverages: fire, water, storm and hail, plus legal liability.
These are starting points for a quote, not a recommendation. Coverage, exclusions and price depend on your home, your state and the policy wording, so compare actual quotes side by side with an agent.
Coverage types and what to ask
| Coverage | What it generally does | What to ask your agent |
|---|---|---|
| Dwelling or building | Repairs the structure after a covered loss | Does it still apply while the home is rented to paying guests? |
| Contents | Replaces your furniture, linens and supplies | Is guest theft or intentional guest damage covered, and is there a sub-limit? |
| Liability | Pays claims if someone is hurt or their property is damaged | What is the limit per occurrence, and does it cover paying guests? |
| Loss of income | Replaces booking income while the home cannot be rented | Does it cover canceled bookings, and for how long? |
| Umbrella | Adds liability above your main policy | Will an umbrella insurer accept a short-term rental? |
| Flood or earthquake | Covers perils many property policies exclude | Is my area at risk, and is this coverage separate? |
| Platform protection | Airbnb's AirCover for Airbnb stays | How does my policy work alongside AirCover, and which pays first? |
Other questions worth asking:
- Does my policy define short-term rental use, and how many nights a year are allowed?
- Does it matter whether I live in the home, part of the year or not at all?
- Are pools, hot tubs, bikes or kayaks covered for guest use?
- Does my HOA, lender or city require a certain type or amount of coverage?
- Can you show me the exclusion wording in the policy itself?
Budgeting for insurance
Premiums vary widely by home, location and coverage, so get real quotes rather than relying on averages. Once you have a quote, add the yearly cost divided by 12 to your fixed monthly costs in the break-even rate calculator, so your nightly rate covers it. The stay profit calculator shows what each booking leaves after costs.
Do it for your rental
Enter your monthly costs and booked nights. See the lowest nightly rate that covers them.
Add insurance to my monthly costsFrequently asked questions
Does homeowners insurance cover Airbnb guests?
Often not fully. The NAIC says most homeowners or dwelling policies are not designed to cover accidents arising from short-term rentals and usually exclude or limit business activity. Ask your insurer in writing.
Is Airbnb AirCover enough insurance for a host?
Airbnb says AirCover for Hosts is not a substitute for personal insurance. It applies only to Airbnb stays. Host damage protection is not an insurance policy, and both parts have exclusions.
How much does AirCover for Hosts cover?
Airbnb lists up to $3 million in host damage protection and $1 million in host liability insurance. Exclusions apply, including normal wear and tear and acts of nature.
Who should I talk to about short-term rental insurance?
A licensed insurance agent or broker in your state. Tell them you host short-term stays, how often and on which platforms, and ask to see the exclusions in writing.
On this page
Do it for your rental
Enter your monthly costs and booked nights. See the lowest nightly rate that covers them.
Add insurance to my monthly costs