If you rent your vacation rental out at least 90 percent of the year, it is considered a business, and therefore a standard homeowner’s insurance policy is not adequate coverage. We recommend specifically asking your insurance provider about their vacation rental coverage or shopping around for a vacation rental policy. Here is what you should be looking for:
Property Protection
This includes coverage for the property and all property structures including the garage, fences, swimming pool etc. Property protection could also provide coverage for your personal property, such as the furniture.
Liability Coverage
Liability coverage is extremely important for a rental property and provides the coverage for medical bills or legal expenses if a guest is injured at your vacation rental property.
Loss of Rent Coverage
If you are unable to rent out your property due to a fire, flood, or guest damage, Loss of Rent Coverage will help cover your lost rental income.
Supplemental Coverage Based on Location
- Earthquake Coverage- If your vacation rental is in California or another area at risk for earthquakes, you should be covered.
- Flood Coverage- Is your vacation rental property in an area prone to flooding like Florida? Flood insurance is a must.
- Volcano Coverage- We require all Hawaii vacation rentals we finance to have volcano insurance.
Your vacation rentals are investments, and therefore you should obtain the best coverage possible to protect them. Keep in mind, vacation rental insurance policies will never cover any maintenance and repairs or guests’ belongings.
Want more vacation rental insights and tips? Check out the “Vacation Rental” section of our blog. Want more investor resources? Check out our Resources Page.
Related: 5 Affordable Family-Friendly Vacation Rental Amenities from Amazon, 3-Year Vacation Rental Market Trends
