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The Shocking Truth About Airbnb Insurance: Are You Really Protected?
Understanding and implementing the right insurance coverage for your short term rental is a complex but essential task. With insights from Nick Massey, this episode of The Short Term Show has shed light on the necessity of specialized insurance policies in protecting your assets and ensuring the safety of your guests. Whether you’re facing the unique challenges of a particular market like Florida or navigating the unpredictable world of guest-related liabilities, the right coverage is out there. Remember, where there’s risk, there should also be protection.
Avery: awesome so let’s let’s talk about why you might need different insurance for a short-term rental versus a long-term rental for example so can you hit us with the high points on that
Nick: yeah so properties fall into three categories in the insurance world you have personal property you have rental property and then you have commercial property right and the landlord realm falls into the personal category so it’s not limitated through business activity exclusions but those policies do have business activity exclusions in them the homeowners and the landlord policy and the biggest limitation that they have is the business activity exclusion which specifically States if you’re making more than $2,500 a year or more on the property profit motive does not take into account on the exclusion you could have virtually any claim denied liability or property damage by operating with one of those policies.
Avery: when you say self-insure for people that aren’t familiar that means you’re rolling without insurance and you’re paying for whatever happens.
Nick: yeah yeah so you know Florida Florida’s a tough market and I know I know you’re probably heavily familiar with that because you guys have properties there um and a lot of homeowners are based on the cost of window and hurricane insurance now are are rolling the dice they’re self-insuring wind and hurricane damages and so a lot of Central Florida properties that really don’t get hit like the miamis and the keys and stuff like that will self-insure their their wind risk and okay we have $5,000 in roof damage we’ll just eat that versus spending 20 $30,000 on an insurance policy.
