Airbnb and homeowners insurance

12 Replies

I am in the Airbnb for 3 months now with a full house dedicated to only Airbnb, (2/2 bungalow) and I gross about $1200-$1300/month on it.  This house would rent monthly for maybe $800-$850 a month so it sounds good, BUT....

My insurance company got ahold of that Airbnb and my insurance went from $1600/ye to $2800/year because of daily rentals.  Other quotes came in at $3K+.  This means that all increased profits I might have over regular rentals, along with utility and such makes this no longer worthwhile.

I would rather do Airbnb to be honest, but does anyone have suggestions for insurance carriers (Florida) or other ways to deal with it.  staggeringly ridiculous rates and no much choice.  Once again, insurance companies rule the world.

I do. I use Proper Insure. I did a lot of due diligence for my properties and found out my current carries did not insure my Airbnb rentals when they were rented and where they were vacant.

PM me and I will connect you guys. 

Hi @David Hayes , I use Foremost for coverage on my STRs and for my 3 bed/3 bath townhouse in Lake Tahoe I pay $1267/year.   Hope that helps, I know things are always a bit different in Florida however when it comes to coverage.  

Good luck! 

no i did not, just did the form online.  the rate is similar to what everyone else is quoting.  that is Florida I am afraid.  no one wants to insure anything other than inland homes made fo concrete, owned and operated by the homeowner.  still shopping

@David Hayes

I live in CA converted the living space above my garage and turned it into an Airbnb. I contacted my insurance broker and it cost me an additional $65.02 annually to get a Ryder for my insurance. You might want to contact an insurance broker and see what’s out there.

Still searching folks and thanks for all the leads.  Here's the bottom line I think I (we) am heading towards.  Short term rentals are considered a commercial property.  At least that is what I am running into, hence the high rates.  Most landlords are getting away with it because their Insurance is not aware that they are renting out rooms/apts/houses that way.

buyer beware, I think this is an avenue that the corporate giants are starting to close in on.  Will stay updated with any new info I find, but right now, every company is coming in at $3K+/- per year for this 1100 sq ft 2/1.5 block home in Florida, JUST because I told them I was doing Airbnb.  That is about $140K in home and $2M in liability, and deductible limits only change the rate by $100 or so.

Long term rent potential is about $800-$900/month in this market.  tenant would pay utilities and internet which amount to about $210/month.  Insurance would cost me about $130/month for gross of say $720/month

Airbnb current model:
$1200 income

-$55 internet

-$130 electric

-$45 water/sewer/trash

-$250 insurance


break even for me.

@David Hayes If you are renting the home for a 3 night minimum it opens up the possibility of insuring the property on a residential policy which tends to be substantially cheaper than a comparable commercial policy. There are carriers, especially in FL, that specialize in writing vacation rental properties, you just have to know where to look. 

well my experience so far is that what you are suggesting is NOT actually possible.  short term rentals is anything under 6 months.  minor definition variations between short-term and/or vacation rentals, but outcome is basically the same.  No one is writing a policy for 3 day rentals as 'residential', so if they exist, you are correct in that i do not know where to look, but I am consulting with no less that 6-8 carriers and brokers so far.  

All the same answer.  $3000/year, whether they specifically call it a commercial policy or just a short term rental policy as a house.  Makes no difference what it is called, the price is the same.  Like I said, I think the industry is catching up to this and capitalizing on it.  My advice is to never disclose that you are doing short term rentals.