Question about vacation rental insurance

4 Replies

My friend is considering purchasing a vacation property at the beach and renting it out. A main concern is if the town gets destroyed by a storm yet somehow the houses are still rentable and you cannot get an insurance claim in on the house itself, is there any form of insurance that can cover the loss of rental income due to people not wanting to rent the house because the rest of the town is destroyed? Thank you.

Try Proper Insurance. My policy has some loss of income coverage but I don’t have it in front of me so can’t get too specific at the moment. Their policies are designed for short term rentals.

@Robert Hewson

Now that's an interesting question. And one I don't know the answer to. We don't really have natural disasters here in Denver, but Colorado Springs -- where a lot of our clients are looking for short-term rental/Airbnb properties -- is having more and more serious wildfires, so that is always a possibility.

I would echo @Katy Wyly and say give Proper Insurance a call. They've got pretty solid coverage areas, so they might cover something like that. 

Good luck!

Generally loss of income pertains to the income you would loose while the property is being repaired. I dont think loss of income would kick in unless your property was damaged and unable to rent. Interesting question for sure.

Good question - I remember a couple years ago the outer banks lost electricity for an extended period of time and people were getting calls not to come so this isn't that far fetched.

On the personal lines Vacation / Short Term Rental policy I have not seen that it covers loss of income from something off site like the power being out, water shut off, etc which is what I think you are referring to. Like others stated above - If the  property was damaged and under repair then yes you should be able to collect for loss of revenue on that policy.

Most commercial policies can include an endorsement for that type of loss but I have not seen a dedicated commercial policy for short term rental from any of the carriers I deal with (yet).

I hope that helps.