Do I Need Extra Insurance for Airbnb?

Do you need additional insurance for your Airbnb?

It depends on your exact needs with Airbnb. Unfortunately, there’s no one-size-fits-all answer.

Let’s find out why.

Does Airbnb Provide Insurance for Hosts?

According to Airbnb, hosts have Airbnb liability insurance of up to $1 million (USD) to protect hosts against third-party claims for personal injury or property damage (exclusions apply).

This coverage may resolve claims quickly, but is it sufficient for short-term rental needs? It’s easy to see the one-million-dollar figure and ignore what it actually covers, so we’ve combed through the legal jargon for details that may make it easier for you to decide.

In this article, we’ll review the specifics of Airbnb’s host insurance coverage options, including:

• What does Airbnb host liability insurance cover?
• Is Airbnb insurance enough?
• What do you need to know if you rely only on Host liability insurance?
• If you were going to get extra insurance, what should you get and where can you get it?

Hopefully, by the end of this article, you’ll have a good idea of whether or not you need extra insurance for your Airbnb from a separate company, or if Airbnb’s official insurance policy is enough.

What Does Airbnb Host Insurance Cover?

Airbnb’s Host coverage program is called Aircover for Hosts. The official Aircover webpage can be a bit difficult to understand. When it comes to exactly what Airbnb host liability insurance covers, you can rest assured that you’re covered for third-party claims against:

• bodily injury
• property damage (“home, unit, rooms, possessions”)

If one of your guests falls and injures themselves and attempts to sue you, you’re likely covered. 

According to their official page, the host liability portion of Aircover for Hosts “insures Hosts, in certain countries, for their legal liability for bodily injury or property damage to guests or others resulting from an event that happens during a guest’s Airbnb Stay” — but the Host Liability Insurance Summary notes that coverage has limitations for certain stays and locations, so be sure to check all disclaimers regarding coverage limits and terms that may apply.

Does Aircover Cover Damages?

Beyond Host liability insurance, Aircover for Hosts provides $3 million in coverage should your guest damage your property or belongings during their stay. According to Airbnb, this is not an insurance policy and these claims are managed through the Airbnb Resolution Center. Airbnb claims it will cover the cost of expenses such as the replacement of art and valuables, pet damages, deep cleaning, income loss, and coverage for damage to autos and boats that are parked on your property. 

There are additional exclusions and terms for this portion of Aircover for Hosts, so be sure to research those terms so you know what coverage may apply to you.

What Is Not Covered by Airbnb’s Host Insurance Policy?

Airbnb states that it does not cover:

• Damage from normal wear and tear
• Loss of currency
• Loss due to acts of nature (like earthquakes and hurricanes)
• Auto and boat coverage applies only to parked vehicles and vessels

Airbnb’s Aircover for Hosts might work for you in most instances, particularly if you’re not renting full-time. But there are more questions to be answered.

When in doubt, talk to your insurance provider. This is particularly important if you have questions about landlord’s or homeowner’s insurance.

Certain insurance policies might not cover your property if you use it as a short-term rental. Almost all of them will have commercial exclusions. So, while you might think you will be covered for something through your typical insurance policy, you might find that because you didn’t alert your provider about your rental activity, they’re not going to cover your loss.

You don’t want to rely solely on Airbnb’s Host liability insurance because a lot of things aren’t covered.

Is Airbnb “Host Protection Insurance” Enough?

You’re probably not going to like this answer, but… it depends.

Ultimately, that’s a question you’re going to have to answer for yourself, but we do have some questions you can use to guide your decision-making:

1. What are my goals with Airbnb?
   • Is this just something I’m doing for fun? (How many rooms am I renting out?)
   • Do I want to turn this into a full-time project? (Am I renting out whole homes?)
2. What do I own that won’t be covered by the Host liability insurance?
   • Look at “Host Liability Insurance Summary”, then scroll down to “Exclusions,” to learn what isn’t included in the policy. Do you have items specific to your property that won’t be covered in the event of an accident?
3. Do I feel comfortable relying solely on Airbnb’s Host liability insurance?
4. Bodily damage through assault isn’t covered by the Host liability insurance. Assault is uncommon, but do you feel comfortable knowing that you’re relying on a company that wouldn’t protect you in the event a guest punches you in the face and breaks your nose?

Quick Summary

Host liability insurance offers the potential to quickly resolve losses due to damage or injury through the Airbnb Resolution Center. For some claims, Airbnb may not agree that damages are due and you could be left with a loss if you have no other coverage.

You must also keep in mind that Aircover only protects you with regard to your operation as a rental property through their platform. It does not cover anything outside of those circumstances, such as injury or damage to others like neighbors or a delivery person, your personal friend. It also won’t protect you for stays booked on other rental platforms. That liability is your responsibility as the property owner. So a homeowner’s policy is still essential to protect yourself from legal claims as well as to protect your investment from damages caused by other means.

Companies That Offer Home-Sharing Insurance Coverage

The first thing you want to do when searching for home-sharing insurance coverage is to check with your current provider.

Your current insurance policy likely does not include insurance for short-term rental. As soon as you list your house on Airbnb — or even just one room of your house — it becomes a rental property. That gives your insurance company a possible way out in case you ever need to make a claim, even if the damage didn’t occur during an Airbnb stay.

With that said, there are two possible policies you may want to consider depending on the scale of your Airbnb rental operation. Here’s a short breakdown of what’s available:

1. Home-sharing insurance
   • If you’re just renting out a room in your house, this type of insurance is perfect for you. It’s geared toward homeowners, not landlords or property managers or anything.
   • Some policies are designed specifically for short-term rentals, such as those offered by Proper Insurance. These policies can insure the property during short-term rental stays, vacancies, and when the property owner is in residence. 
2. Commercial insurance
   • Alternatively, if you own multiple properties or you just need more extensive coverage for whatever reason, you may opt for commercial insurance.

Finally, here’s a list of companies that offer home-sharing or short-term rental insurance. Home-sharing insurance is fairly new, so not all insurance providers offer this type of coverage yet.

1. Proper Insurance
2. Steadily
3. Liberty Mutual
4. Slice
5. cBiz
6. American Family Insurance
7. Allstate

Conclusion

Do you need extra insurance for your Airbnb? 

Airbnb’s liability insurance won’t cover you for everything, so it’s a good idea to have additional insurance in place to protect your Airbnb.

Insurers might vary according to your city and state, so not all of the providers listed will be available depending on where you’re operating. When in doubt, connect with someone on our Facebook group to see recommendations.