YES, both Airbnb and VRBO offer $1,000,000 in liability coverage for any booking made through their platform. Isn’t that nice of them. What are you really buying when you purchase liability insurance? You are buying a duty to defend which includes attorney’s fees, and if needed a settlement occurrence limit of say $1,000,000. What’s wrong with the FREE insurance that Airbnb & VRBO provide? Your name is not on it and you have no policy rights because you didn’t buy anything. Also, if you read the liability contract(s) there are some major exclusions. If you had a guest that was killed from smoke inhalation as the result of a kitchen fire, from faulty wiring, and you expect to send Airbnb an email, and they are going to send you a team of lawyers, you are not living in reality. There is a reason one of the all time great saying’s is “nothing in life is free”.
To put it another way, if a renter burns your house down, then you send an email to Arbnb support and they rebuild your house? Last time I checked they didn’t have a partnership with Habitat for Humanity. There are dozens of high profile cases where Airbnb Hosts are going public on the fact Airbnb doesn’t guarantee anything in the event of major property damage from a guest, as the claims process is designed to fail. I encourage you to Google “Airbnb Host Guarantee Claims”, and get a few pages deep, and you will find these denials. They are found on news sites and discussion forums just like this one.
The bottom line here is that you need insurance with your name on it.
It’s also important to remember that renting out your home as a short term vacation rental constitutes as ‘business activity’. A typical homeowner’s policy is a personal policy that has specific language to exclude coverage for business activities within the home. Simply having a rider on a personal homeowners policy is fundamentally wrong for a short term vacation rental, since pretty much every homeowner’s insurance policy has what is called a ‘business activity exclusion clause’. This is specific verbiage within the policy that excludes claims coverage when the homeowner is conducting a business within their home. Even if your agency doesn’t cancel your policy, they will most likely deny any claim you might have- Even if the claim has nothing to do with a renter destroying something within the home. The reasoning behind this is homeowner’s policies are personal policies, whereas specific insurance like Proper Insurance (https://www.proper.insure/) is a commercial policy that covers everything you need.
Proper Insurance specializes in short-term vacation rental insurance. They are the ONLY general agent in this field who is a cover-holder for Lloyd’s of London. Their commercial package policy is specifically built to cover you and your guests at your Airbnb. In the insurance world, you get what you pay for and if you want the best coverage, getting backed by Lloyd’s is the only way to go. Definitely worth checking out: https://www.proper.insure/