Short-term rental and Airbnb insurance
If you’re thinking of using your home as a short-term rental in Australia, standard home and contents insurance may not be enough. Let’s check out the three main ways you can get covered.
Key takeaways
- Standard home and contents insurance won't usually cover short-term rentals.
- Platform protections on sites like Airbnb may not fully cover you for all risks.
- There are a few different options that can protect your property.
What is short term rental and Airbnb cover?
Short-term rental and Airbnb cover protect you from damages, theft, and legal issues when you use your home as a short term rental.
Renting your place out to paying guests makes it a business in the eyes of insurers. So typically home and contents insurance won't cover it - in some cases it might even be void.
Fortunately, you can choose from specific short term or holiday rental insurance options that safeguard you and your property. Landlord insurance is also an option in some cases.
Standalone rental cover vs Airbnb insurance
There are actually 3 different types of home insurance that might help you if you're renting out a property.
- Short term rental insurance gives you comprehensive coverage for your entire property, or just the part you're renting out. Some providers let you pay per night you have the property rented, which is excellent if you also live in the home yourself. If you're looking to host over an extended period of time, you'll also have the option to insure your home for up to 12 months at a time.
- AirCover for Hosts is Airbnb's in-house host protection insurance. It covers you and your property for a few different key risks. It's cover is divided into 'damage protection' and 'host liability'. Damage protection covers the cost of damage to your property, while host liability can help cover certain costs associated with your guests.
- Landlord insurance is mainly for non-vacation rentals. However, it will sometimes provide cover for Airbnb and other short term rentals. Most insurers will have specific conditions you need to meet in order to be fully covered, and the cover can be fairly limited compared to dedicated policies. If you're looking at insurance for a dedicated vacation rental property, this probably isn't the best bet.
What does short term rental insurance cover?
What you get from specific short term rental policies can look a lot like home and contents insurance. What makes things different is the inclusion of incidents involving paying guests.
This can include incidents of damage or loss to the building itself and the contents of your home such as:
- Injury or death to a guest
- Legal & personal liability
- Fire-related damage
- Accidental damage by guests
- Purposeful damage by guests
- Bulgulary
- Theft or attempted theft by guests
- Strata and property damage
- Coverage for natural disasters
- Water damage
- Loss of rent or income
- Identity Theft
Many of these items are unique to short term rental insurance, as they involve paying guests not tenants. If it involves the loss of rent or income while you're hosting, you're unlikely to find cover outside of specific short term rental policies.
All policies will have exclusions. It's best to read an individual policy's product disclosure agreement (PDS) for a full rundown of these.
What is Airbnb insurance cover?
Airbnb insurance or Aircover is the included insurance that Airbnb provides for hosts. It's broken down into Damage protection and Host liability insurance - which offer financial protection for various incidents involving guests or people they invite.
Host liability insurance
Host liability insurance offers financial protection of up to $1 million USD if a guest is hurt or belongings are damaged.
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Damage protection
Damage protection can compensate you for up to $3 million USD if your belongings or home is damaged by a guest or people they invite during their stay.
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Does landlord insurance cover holiday homes?
Yes and no. Looking at landlord insurance policies across five popular Australian insurers, there aren't many that provide comprehensive coverage for short-term stays and Airbnb.
Of the policies that do offer some protection, there seems to be quite limited coverage and a number of conditions you'll have to consider.
- Suncorp: No cover unless property is leased to formal tenants.
- QBE: Protects against loss of rent from holiday rentals with a number of exclusions.
- Youi: Cover is available for stays under 3 months, but only for formal tenants.
- ANZ:No cover is available for short term rental or Airbnb activity.
- NRMA: No cover is available for short term rentals or Airbnbs.
Expert insight: The right type of cover is essential
"Before welcoming visitors to stay in your home, talk to your insurer about what is and isn't covered, and consider specialised coverage for peace of mind."
Insurance Brands that cover short term rentals
- ShareCover
- EBM RentCover
- Fully Insured
- BJS Insurance Brokers
- Insure More
- Terri Scheer
- Shielded Insurance
- Maxon Insurance Brokers
- Homsure
- Atlantic Insurance
- Ceneta Insurance Services
- RAA
- Breeze Underwriting
- Duoinsurance
3 things to watch with landlord insurance
As an Airbnb owner, landlord insurance is likely the first port of call for your insurance needs, but it doesn't fit everyone. Here are 3 things to check with your insurer before you confirm that booking.
- Review your home and contents policy to see if it includes short-term rental protection or, if using your policy this way might void your coverage.
- Make sure the time is right. Landlord insurance policies generally only cover stays longer than three months. This won't apply to most guests in short stays or Airbnb's.
- Does the policy fit your living situation? Some policies need you to stay on the property while hosting guests, while others require you to be absent for cover to apply.
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Hi – I am looking for Short Term Rental Accommodation insurance. We have a 5 bedroom home with 2 bedrooms being in a granny flat on the ground floor with two deadlocked doors separating the downstairs STRA from our upstairs home and principal place of residence. We consider the risk of damage to be extremely low as we have an experience STRA co-host who is expert at vetting people (on a non-discriminatory basis) before a booking is accepted, and we only accept STRA’s for periods when we are also at home so we are here and will know quickly if guests are breaking the conditions of their STRA booking.
I am finding it really difficult to find an insurer. Most of the Insurers listed in your table as offering STRA insurance in fact do not offer it at all. Of the very few insurers who do offer STRA insurance, which do you know of which offer insurance for STRAs which form part of the owners’ home – typically a granny flat like ours. Thanks for your help.
Hi Jennifer,
We’ll be revising the list of providers in our table to ensure the information is correct. In the meantime, you can try looking at these providers:
– Terri Scheer
– Homsure
– Sharecover
In terms of your specific set up with the granny flat downstairs and your main living residence upstairs – I can’t say for sure who will cover you. This will likely vary by insurer as they’ll all have to find a way to assess the risk for the portion that’s used for STRA and the portion you live in. If you are still struggling to find cover after contacting the above suggestions then it could be good to use an insurance broker. They’re good at connecting you with products that are relevant for your specific circumstances and they’re typically free to use.
Hi,
I am looking for an insurer for an airbnb home for building only – no contents. I previously insured with EBM who were as good as insurers get albeit I never claimed anything through the year. Are there any insurers that offer building only for airbnb’s in Australia?
Hi Glen,
Most insurers offer seperate contents and home policies, but as each insurer prices risk differently, their policies for airbnbs and holiday homes are updated frequently, so you’ll need to contact the insurers directly to see what your options are. One thing to keep in mind is that contents includes things like carpets, curtains and kitchen cupboards, which could be at risk of damage when tenanted to holiday guests, so you may want to consider whether contents insurance could offer value? Best of luck!
I am looking to insure the contents like carpet and blinds and tenants goods in an Airbnb one bedroom strata apartment. The building is already insured.
Many thanks
Alistair
Hi Alistair,
A few different insurers may be able to help you out with short-term rentals, including QBE and Youi.
Always read the Product Disclosure Statement (PDS) of a policy to understand exactly what you’re covered for. And by all means, reach out to an insurer directly if you’re unsure about anything related to your insurance.
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Regards,
James