SHORT-TERM RENTAL INSURANCE DESIGNED FOR OWNERS AND HOSTS

The Basics of Vacation Rental Insurance

Our short-term rental insurance policy was created to replace the property owner’s current Homeowners (HO) or Landlord (DP) insurance policy. It is written as a commercial business policy, giving the short-term vacation rental owner comprehensive coverage for their building(s), contents, commercial business liability, and lost business income. It also includes personal liability when the short-term or vacation rental “doubles” as the owner’s primary residence, which is the case for many Airbnb and Vrbo hosts. The Proper Policy is built as a short-term rental policy, not adapted from a Homeowners or Landlord form.

The challenge was occupancy of the properties, as most short-term rental properties have short-term and mid-term rental uses, are used personally by the owner, and even have times of no occupancy.

Proper’s short-term rental policy covers what Homeowners and Landlord forms can’t—owner use, guest stays, and vacancy—in one commercial policy.

The Proper Policy is a short-term rental insurance custom-penned with Lloyd’s of London and Concert Specialty, and covers the unique risks associated with short-term vacation rental properties. It’s the most comprehensive short-term rental insurance an Airbnb or Vrbo owner can purchase—whether you call it short-term rental or vacation rental insurance—offered in all 50 states and Washington, D.C.

The Growth of Airbnb & Insurance for STRs

The Airbnb phenomenon has changed the vacation rental and travel industry forever, making Airbnb full-time rental insurance a need, not a want. Ten years ago, there were only 200,000 short-term rental properties in the U.S., primarily marketed via local property managers; now, there are over 2,000,000 because of Airbnb. Virtually any property owner can advertise on Airbnb and instantly compete with Hilton and Marriott for travelers’ lodging dollars. Unfortunately, with this ease of use comes huge property and liability insurance concerns.

When you allow guests or travelers to book your property on Airbnb, you have crossed into hospitality law, and Homeowners or Landlord insurance doesn’t cut it. In addition, you need to consider the significant damage a guest could cause to your property, such as a fire or vandalism. You also need to consider the safety of the guest and the fact that you could be found liable for virtually any bodily injury they may sustain while staying at your property. These concerns require Commercial-grade insurance from a comprehensive Airbnb insurance provider.

That is why Proper Insurance is uniquely designed to cover the many issues specific to Airbnb rentals broadly. Our focus is short-term rental exposure; our policy is the most comprehensive, and we have been rated “second to none” in the industry. If the policy on your Airbnb was written for a homeowner or a landlord, contact Proper Insurance to cover it as the business it is.

Vrbo Still Leads In Vacation Rentals

Vrbo is the founding website for “vacation rental by owner” and was originally a classified ad listing service for the do-it-yourself property owner. As Vrbo grew in popularity among travelers looking to find short-term vacation rentals, so did its rank on 1st page of Google searches. Vacation rental managers began to list their inventory on Vrbo; the rest is history. Today, most professional data shows Vrbo as the #1 vacation rental booking website in the United States.

Vrbo insurance has never been more critical. Most Vrbo property owners are not fully aware of the limitations or gaps in coverage found in Homeowners and Landlord policies. When you entrust your property to a paying guest, you fundamentally change the exposure in the insurance contract. Limitations now exist for damage caused by a guest, theft, vandalism, liability, and so much more. When you move your Vrbo to a short-term rental policy like Proper’s, you fill those gaps and add coverage tailored to vacation rentals.

Home Sharing vs Vacation Rentals

Home-sharing and vacation rentals are very different in the insurance world, and a home-sharing insurance endorsement is not a short-term rental policy.

Home sharing is when the host lives on site and is favored by Airbnb as hosts offer a room for rent at their property. Essentially, it’s a bed and breakfast, hence Air Bed and Breakfast.

Unfortunately, domestic insurance carriers picked up on this and began offering a home-sharing endorsement that allows for this rental activity and typically provides limited coverage of $10,000 or so. The endorsement is inexpensive, typically costing $75-$100.

If you do not live on-site and consider the rental property your primary residence, then DO NOT purchase and rely on a Homeowners policy with a home-sharing endorsement. Many insurance agents do not realize coverage could be void.

A vacation rental or short-term rental is considered an investment or secondary property. These properties need comprehensive vacation rental insurance, like The Proper Policy, a Commercial Homeowners policy.

Switch to Proper Insurance

Proper Insurance leads the Nation in insurance for vacation rental properties, with over 200,000 policies written in all 50 states and Washington, D.C.. Backed by Lloyd’s of London, Concert Specialty Insurance, and an exclusive endorsement from vacation rental leader Vrbo, our company is built on world-class insurance coverage.

Our policy covers vacation rental homes, townhouses, condos, duplexes, cabins, cottages, apartments, and more. We can tailor a policy specific to your short-term rental property with expert vacation rental underwriters and agents.

A Lloyd’s of London Insurance Policy

Lloyd’s of London is considered the world’s most prestigious insurance market, best known for specializing in emerging or unusual risks. The Lloyd’s market comprises 80 syndicates interacting with thousands of brokers daily, creating business and personal insurance solutions in over 200 countries.

Lloyd’s success has been built on its character of paying all valid claims. In over 300 years, Lloyd’s has never gone insolvent and maintains an A+ (Superior) rating from AM Best.

Lloyd’s insures most FTSE 100 and Dow Jones Industrial Average companies.

Lloyd’s is the world’s specialist insurance and reinsurance market, bringing together an outstanding concentration of underwriting expertise and talent. As a result, it is often the first to insure emerging, unusual, and complex risks.

Around 80 syndicates are underwriting insurance at Lloyd’s, covering all business classes. Together, they interact with thousands of brokers daily to create insurance solutions for businesses in over 200 countries and territories. As a result, Lloyd’s insures the majority of FTSE 100 and Dow Jones Industrial Average companies.

Lloyd’s success has been built on its reputation for paying all valid claims. As a result, the claims service provided to policyholders remains a cornerstone of the market’s business.”

Proper Insurance is a Coverholder at Lloyd’s. There are only 4,000 Coverholders in the world. Lloyd’s enjoys strong financial security supported by excellent ratings.

Visit Lloyd’s of London for detailed information.

A Concert Specialty Insurance Policy

As Proper continues to set the standard in the vacation rental insurance market, it was important for us to find more underwriting support, and we did with Concert Specialty.

With a deep understanding of specialty insurance and excellent financial ratings, Proper was excited to add Concert as an underwriter alongside Lloyd’s of London.

Visit Concert Group for detailed information.

Building and Contents Coverage

The Proper policy provides coverage for the building and contents or personal property. Proper automatically enhances the coverage form to ‘all-risk’ or exclusions based and includes replacement cost valuation. It’s superior in every aspect.

• Special form ‘all-risk’ cause of loss on building and contents
• Replacement cost valuation on building and contents (new for old)
• No sub-limit on damage caused by a renter (accidental/intentional/malicious)
• Vacancy clause removed with no occupancy restrictions
• No sub-limit on theft, vandalism, or water damage
• Back-up sewers and drains
• Loss assessment
• Debris removal
• Unscheduled structures
• Ordinance or law (optional)
• Bed Bug & Flea Protection (extermination, lost business income, and guest liability)
• Squatter Protection

Commercial General Liability

With the explosive growth of vacation rentals, cities, counties, HOAs, and even some states are passing laws and ordinances concerning short-term rentals (STRs).  The common thread is that an STR is a business no different than Hilton, and hospitality and insurance laws should apply.  Because the Proper Insurance® policy is a business policy and carries commercial general liability, it complies.  All short-term vacation rental property owners need commercial insurance.

• $1,000,000 standard occurrence limit, with $2,000,000 available
• Designed to meet common STR proof-of-insurance requirements
• Liability extends beyond the premise and follows the guests
• Enhanced for pet/animal, liquor liability, and invasion of privacy
• Includes advertising injury and communicable disease
• No exclusions on assault, battery, or molestation
• Continues over amenities such as bicycles, golf carts, hot tubs, pools, fishing, rec areas, small watercraft, and more
• Additional $1,000,000 in personal liability when rental “doubles” as a primary residence

Business Income Protection

When a covered cause of loss occurs, such as a fire, wind damage, water damage, or vandalism from a guest, current and future bookings are typically canceled to accommodate repairs.

This is why Business Income coverage is a must-have for every short-term vacation rental owner.

• Paid on an ‘actual loss sustained’ valuation
• Insures business income, not loss of rents
• No time limit on coverage payout
• Only subject to the limits you choose