Best Home Insurance for Airbnb Hosts (Avoid Costly Policy Gaps!)

Introduction: The Airbnb Host’s Insurance Wake-Up Call

When San Diego host Lisa returned from vacation to find her Airbnb guest had thrown a party that caused $15,000 in damages, she assumed her homeowners insurance would cover it. They denied her claim—because short-term rentals voided her policy.

If you’re renting your home on Airbnb (or planning to), you need to know:
✔ Why standard home insurance fails hosts
✔ 3 types of coverage that actually protect you
✔ How Airbnb’s “Host Guarantee” falls short
✔ Cheapest ways to get full protection

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1. Why Standard Home Insurance Doesn’t Cover Airbnb

Most policies have a “business activity exclusion”, meaning they won’t cover:

• Guest-caused damage (broken furniture, stolen items)

• Liability claims (if a guest gets injured)

• Lost income (if damage forces you to cancel bookings)

🔹 Airbnb’s “Host Guarantee” Isn’t Enough

Airbnb offers up to $3M in property protection, but it:
❌ Excludes cash, jewelry, and pets
❌ Requires you to prove the guest caused damage (hard without video evidence)
❌ Won’t cover liability lawsuits

📌 Real Example: A Denver host’s claim was denied because she couldn’t prove a guest scratched her hardwood floors.

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2. 3 Best Insurance Options for Airbnb Hosts

🔹 Option 1: Home-Sharing Endorsement

• What it is: A cheap add-on ($100-$300/year) to your existing policy.

• Covers: Up to $10K in guest damage and limited liability.

• Best for: Occasional hosts (<30 days/year).

• Providers: State Farm, Allstate, USAA.

🔹 Option 2: Landlord Insurance

• What it is: Covers rentals but not short-term stays (check for “STR riders”).

• Covers: Property damage, liability, and lost rent.

• Best for: Hosts renting long-term (30+ days).

• Providers: Farmers, Nationwide.

🔹 Option 3: Commercial STR Insurance

• What it is: Full coverage for frequent Airbnb hosts.

• Covers: Guest damage, liability, income loss, and even bed bug treatments.

• Best for: Full-time hosts or those renting multiple properties.

• Providers: Proper Insurance, CBIZ, Slice.

📌 Cost Comparison:

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3. 5 Deadly Coverage Gaps to Avoid

🚫 Gap #1: The “Party Damage” Loophole
Most policies exclude intentional damage (e.g., vandalism from unauthorized parties).

✅ Fix: Get a policy with “unattended guest” coverage (Proper Insurance includes this).

🚫 Gap #2: No Liability for Guest Injuries
If a guest slips and sues, standard insurance may deny the claim.

✅ Fix: Ensure your policy has $1M+ in liability coverage.

🚫 Gap #3: Theft of Personal Items
Guests stealing your TV, art, or designer linens? Standard policies often say “tough luck.”

✅ Fix: Add scheduled personal property coverage.

🚫 Gap #4: Lost Booking Income
If a fire makes your home unrentable, can you afford months of missed income?

✅ Fix: Get a policy with business interruption coverage.

🚫 Gap #5: Squatters & Long-Term Damage
Some policies won’t cover damage from guests who overstay.

✅ Fix: Look for “unauthorized occupancy” protection.

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4. How to Save Money on Airbnb Insurance

🔹 5 Smart Discounts for Hosts

1. Security systems (cameras, smart locks = 10% off).

2. Multi-property policies (bundle if you host multiple homes).

3. Claims-free history (5+ years = up to 15% off).

4. Higher deductibles ($1K vs. $500 saves ~20%).

5. Pay annually (avoid monthly fees).

🔹 Airbnb’s Hidden Protection (When It Helps)

• AirCover for Hosts may cover up to $1M in liability (but read the fine print).

• Requires you to file police reports and provide evidence.

📌 Pro Tip: Always document your home’s condition before/after each guest with time-stamped photos.

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5. Airbnb Host Insurance FAQs

Q: Does my homeowners insurance cover Airbnb if I don’t tell them?
A: No! You risk policy cancellation and claim denials. Always disclose.

Q: What’s the cheapest way to get covered?
A: A home-sharing endorsement (if you host <30 days/year).

Q: Can I get insurance if I rent out just a room?
A: Yes, but you’ll need a rider for “boarder liability.”

Q: What if my city bans short-term rentals?
A: Some insurers (like Proper) still cover you—check local laws first.

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Conclusion: Protect Your Airbnb Business

Your 4-Step Plan:

1. Review your current policy for exclusions (call your agent).

2. Pick the right coverage (endorsement vs. commercial policy).

3. Add extra protections (liability, theft, income loss).

4. Document everything (photos, guest agreements, incident reports).

Need a Quote? Check Proper Insurance (specializes in Airbnb coverage) or State Farm (best for part-time hosts).