What you need to know about home insurance for Airbnb and Stayz properties

​​There’s no legal requirement for you to purchase home insurance before renting out a property. Some vacation rental platforms like Airbnb also provide insurance to hosts as part of the letting fee. However, whether the default coverage offered by a platform is enough for you depends on what exactly they are providing and the level of risk you are willing to take. 

It’s crucial to carefully review the insurance offered by the platform you choose. Many of the popular holiday rental platforms provide some coverage for property damage and liability. 

If you use Airbnb to rent out your place, you’re covered bysomething called AirCover for Hosts. It's like an insurance package that automatically applies to all hosts on the platform. 

With AirCover, Airbnb provides protection in case of damage and liability. At the time of writing, AirCover includes various protections for hosts, such as guest identity verification, reservation screening, host damage protection for up to $3 million (USD) and host liability insurance for up to $1 million (USD). 

Despite the extensive coverage provided by Airbnb, there may be certain gaps in your insurance you need to know about. For instance, host damage protection may not provide you with any coverage against losses due to acts of nature (like earthquakes or flooding). So you may still need to purchase building insurance to protect your house from damage caused by weather-related events or acts of theft and vandalism. 

To ensure your property is adequately protected, make sure to read the terms and conditions of the insurance coverage offered by a vacation rental platform. 

This way, you can identify instances where coverage may be lacking. If there are situations where you find yourself without adequate protection, you may consider purchasing additional insurance to safeguard your interests.

A standard home insurance policy provides you coverage against unexpected events like fire, flood, storm, vandalism, and theft. Some home insurance policies also provide protection against accidental damage that is not a result of your negligence. However, your home insurance policy is unlikely to cover you against tenant-related damage if you choose to rent out even a part of your home to somebody else. 

Depending on your insurer, they might void your entire coverage or not cover you for certain events if you decide to rent out your property. That’s because a standard home insurance policy is typically designed for primary residences. Using your home for short-term rentals may be considered as carrying out a business that could expose the property to additional risks. 

If you plan to rent out a property (or even a part of it), a landlord insurance policy could offer you more comprehensive coverage against tenant-related damage. However, all insurance policies are different and it is important to read the insurer’s terms and conditions carefully to understand the exact nature of coverage and any exclusions or limitations. 

For instance, not all landlord insurance properties cover you for short-term rentals. The ones that do may charge a higher premium to cover the risk of renting out the property to multiple people. If you already have a landlord insurance policy in place and want to list your house on Airbnb, make sure to check with your insurer whether they’ll continue to cover you. 

It’s also a good idea to speak to your insurer before letting out a part of your property, as using it for earning income could potentially void your existing home insurance cover. Purchasing landlord insurance may be an option but some landlord insurance policies only cover you if you don’t live at the property yourself.

If you only plan to rent out a room or a part of your home on Airbnb, it is worth speaking to your insurer about your options. Remember all insurance products are not created equal. Take your time to read the Product Disclosure Statement (PDS) and understand all the terms and conditions of the coverage before choosing one.