Hi, everyone. Most of my experience lies in the longterm rental property world, but we just picked up a short-term rental in Vermont and are going through the process of getting it ready to go.
The property cost about $415k, and my insurance quote for homeowners + liability was about $4k, which seemed high to me.
Obviously insurance quotes vary greatly by policy, but wanted to get a sense as to what others were paying and what provider they used.
I am used to long-term rental policies, which seem to be less expensive.
Thanks in advance!
STR insurance is usually higher. Check with Proper...
Foremost has the best price for STR commercial policy.
I use Proper insurance, unwritten by Lloyds of London, for my STR - covers the extra issues you would expect from an STR like vandalism, alcohol liabilities, business interruption up $10k, hot-tub cooties etc. It's a commercial policy so I pay a little extra but vey much worth the expense. I made a fair size claim last year and it paid off pretty painlessly except for the 90 day lag. highly recommend them.
If I had used a regular home owners policy with and STR addendum I'm pretty sure it would not have covered my particular issue.
Foremost and a personal umbrella policy.
Yes, the short term rental will be 2-4 times higher than your standard homeowner insurance and higher than a standard long term rental. There aren't a ton of carriers that have jumped on board in writing STR.
Not 100% sure the carriers in your specific state, but I know that Proper will write in all 50 states. They are one of the highest premiums when it comes to STR, but also have a very good policy too. As stated on here you can look to Foremost as well. They will cover STR houses. You can also check with a local independent insurance agent to see if any carriers that might not have been mentioned have a short term rental endorsement that they can add to a standard landlord policy (Travelers does in the states I write in). You will want to read the policy language to confirm there isn't an exclusion for STR.
Best of luck
Lots of good info here @Brian Kantor . We use Proper as well. Great coverage but it is more expensive than Foremost and CBIZ.
My company for my personal house covers my STR very reasonably. State Farm, about $1400 yr. Not sure of all of the coverage parameters but it is listed as commercial and vacation rental.
We've been using a Travelers Landlord Policy with a short term rental endorsement. The product isn't quite as comprehensive as Proper but it is significantly cheaper and I feel comfortable self-insuring the gaps with our own emergency funds and relying on AirBNB & VRBO claims.
Escrow a regular homeowners insurance policy and then lease your property to an LLC. Put a proper insurance policy on the LLC. Gives you double protection if something breaks from a direct booking and triple protection from a guest coming in through an OTA. Proper is expensive but worth it. They have a loss of income protection, etc.
@Brian Kantor like everyone else here, I use proper for my higher end properties and travelers for my mid tier STRs.
Because VT is a traditional rental market (ski houses), depending on the minimum duration you will be allowing for rentals (ie. monthly, Weekly, etc.) there are some regular carriers in the New England Market that will write it. So if you are not doing daily rental, have your agent check with some of the regional carriers and see how they compare.
Closing the loop on this for everyone. I ended up going with Proper. They were more expensive, but really know what they are doing in the STR space and we were much more confident with their proposal than the cheaper one we got from our usual broker who had less experience with STRs.
@Brian Kantor late to the party, but the $4k/year quote definitely seems excessive and hope you did better with Proper. As comparison SF got my southern VT 3BR/2BA STR covered at < $1k/yr for 2k/500k + umbrella (albeit with bundled discounts in play). MetLife was actually even more affordable in VT. I think Jerry Farnum in Springfield's still their point of contact on new quotes if/when you need them down the line.
Thanks, @Cliff H. We will take a look!