Here’s Why You Need Insurance For Your Airbnb

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A lot of our clients want to know if the Airbnb host-guarantee and host-protection policies provide sufficient protection if accidents happens while they are away. The answer is no, they do not. We recommend protecting yourself with additional coverage.

Why You Need Your Own Insurance

First, Airbnb has dual loyalty. The business cannot survive without hosts, and it cannot survive without guests. It needs to make both parties happy, which may or may not affect your ability to successfully process a claim. Second, the host guarantee is designed to protect against rare instances of damage and does not cover “normal wear and tear.” And because “normal wear and tear” can be interpreted in a number of ways, this makes me nervous.

Related: The Top 10 Dos and Don’ts for Airbnb Short-Stay Landlords

That said, there are three key ways to protect yourself:

1. Screen your guests

2. Utilize the security deposit feature

3. Use a short-term insurance product that specializes in these types of stays

Notice that I didn’t mention rely on your homeowner’s insurance? That’s because a lot of standard homeowner’s insurance policies don’t cover Airbnb, and some will even ask you to stop if they get wind that you’re renting your space.

Related: My Client Has Tripled His Income With Airbnb: Here’s What He Should Know About Taxes

Screening Your Guests

The obvious place to start is reviews. Do they have them? Are they good? Are they specific? What’s your gut telling you?

Airbnb allows for you to take a security deposit. A couple things to note: the Airbnb security deposit has to be added before the reservation is booked; the claim has to be made within 14 days of the checkout date (or before a new guest checks in — whichever is earlier); and Airbnb will mediate and collect from the guest if necessary. As with insurance, there may be mixed loyalties here and an extra level of bureaucracy that could prove to be a headache.

Getting Insurance

There are insurance products that will provide added protection for your stays. You can get an insurance policy that covers you on a day-to-day basis, or one that acts as both a homeowner’s policy and a short-term rental policy. I’m not listing their names here because this isn’t a marketplace, but you can Google them and read about the different products. The key here is to be clear about what you need, and make sure you’re covered in appropriate circumstances.

On a final note, don’t let the news scare you. With the volume of business that Airbnb does, of course there’s potential for accidents. But accidents are rare, and the majority of hosts and guests are good people. Barring any major catastrophe, the money you make from Airbnb will be more than enough to cover a piece of broken furniture.

Have you experienced any accidents with a short-term rental? How did you protect yourself?



About Author

Erin Spradlin

Erin Spradlin co-owns James Carlson Real Estate. She loves working with first-time homebuyers for their enthusiasm and excitement, and loves working with investors because she's a fellow spreadsheet nerd. She and her husband own three properties in metro Denver and are currently in the process of acquiring a duplex in Colorado Springs. You can find Erin's blogs here: and her airbnb video series here:


  1. Jason Allen

    Great post! I always recommend that people get some type of third party insurance on top of the $1,000,000 policy that Airbnb gives hosts. It is expensive but if you shop around you can find some good deals. I’ll say though that if you’re just doing this with one house or it’s just a hobby then it may not be needed. But if you have 3+ properties and your plan is to scale you may want to look into third party insurance just for added protection.
    Also business structure is extremely important. You must set up some kind of legal entity to give yourself added liability protection. The LLC is a great option for Airbnb business owners.

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