Do you really need a STR insurance?

[Joel Oh]

Hi guys, 

I know I will get a lot of hates from this but does STRs insurance really good as their price?

From my experience so far, Airbnb never failed to cover any issues I had caused by guests. 

Also in case of fire or flood, I know a regular homeowner's insurance will have no problem covering it.

I have been wondering, if the local regulation doesn't require it, why do we need pay thousands of extra for STRs? 

Also I am having more and more difficulty finding insurance companies service STRs.

My agent recommended a visitor covering option to my regular insurance. Any thoughts on this?

[Michael Baum]

I am sorry @Joel Oh but you are 100% wrong that a standard homeowners policy will cover guest damage when you are using the home as a short term rental.

The only way they would cover it is if they were unaware that you were short term renting the home. That would be fraud and is a criminal offense.

Just to be clear, you own 250 properties? I find it hard to believe that you would risk a 9 figure portfolio for $300k

I am not saying that getting a 1m payout on a destroyed property is easy. What I am saying is that AirBNB or VRBO aren't going to cover it. You need to have the correct insurance for a STR. That is a type of commercial insurance and not a simple homeowners policy.

Regarding the little things, yes that is what AirCover is for. I have had 3 claims. One for $100 for stolen stuff, one for $250 for a broken futon and a $1000 payout for a broken window (VRBO).

All of those payed out in about 2 days. All I did was send proof of the damage and repair bill.

We are talking about foregoing the correct STR insurance for homeowners expecting it to payout for major guest damage.

I think this calls for another patented day of Mike's Research Plan.

I will do my best to call 6 major insurance companies (not brokers) and get the scoop. I will also call a few lenders to find out what they say regarding using homeowners insurance for commercial purposes.

I figure that should put it to rest. I will start another post like I did with the STR valuation research.