Insurance Policy For an Arbitraged Property

[Neil Smith]

Hi all, 

I'm long-term renting a property to tenants (a husband and wife team) who will short-term rent the property via AirBnB, VRBO etc. My home insurance carrier (State Farm) seems to not be familiar with this arbitrage model and does not want to continue insuring the property. 

Can you recommend an insurance company that will offer a policy for an arbitrage-rental agreement?

Thanks in advance,

Neil

[John Underwood]

Quote from @Michael Baum:

Hey @Neil Smith, you might need to go with a full STR insurance policy from Proper, Foremost or another carrier.

You need to make sure your arbitragers are carrying a similar policy.

Did you ask about a landlord policy from State Farm? I understand why they won't insure it if you were only carrying standard home owners.

Ask about landlord policies. If that works, then the arbitragers need to carry the STR policy, no exceptions. If the landlord won't work, you need to carry it or any guest created problem will leave you out in the cold.

Exactly as Mike said.
Someone needs to have a true STR policy.

Make sure your renters list you as a loss payee on their policy. They should probably be the ones that have the more expensive STR policy and you just maintain a landlord type policy.

I would charge them a higher rent amount and/or profit sharing due to the higher risk and higher wear and tear.

Make them responsible for small cosmetic things so that they don't pester you constantly.