Do I Need Vacation Rental Insurance? What Every Owner Should Know
- Nate Jones, CPCU, ARM, CLCS, AU
- 5 days ago
- 2 min read
If you own a short-term or vacation rental, you may be wondering: Do I really need vacation rental insurance? The short answer is yes—and relying on a standard homeowners policy or platform protection could leave you dangerously underinsured.
Whether you rent your property on Airbnb, Vrbo, or independently, understanding the right coverage can protect your income, property, and financial future.
What Is Vacation Rental Insurance?
Vacation rental insurance is a specialized policy designed for properties rented on a short-term basis. It bridges the gap between homeowners insurance and commercial coverage, offering protection tailored to rental risks.
Most standard homeowners policies exclude business activity, which often includes short-term rentals. This means a guest injury or property damage claim could be denied.
Why Homeowners Insurance Isn’t Enough
Homeowners insurance is intended for owner-occupied residences—not income-producing rentals. Common exclusions include:
Guest injuries
Damage caused by renters
Loss of rental income
Liability claims related to short-term stays
Platforms like Airbnb and Vrbo offer limited host protection, but these programs are not insurance policies and may not cover lawsuits, income loss, or certain damages.
Essential Vacation Rental Insurance Coverages
A comprehensive vacation rental insurance policy typically includes:
Protects the structure, furnishings, and appliances from damage caused by guests, fire, storms, or vandalism.
Covers legal fees and medical expenses if a guest is injured on your property—critical for slip-and-fall claims.
3. Loss of Rental Income
Replaces lost income if your rental becomes uninhabitable due to a covered claim.
4. Contents Coverage
Protects furniture, electronics, linens, and décor used by guests.
Adds an extra layer of protection beyond standard liability limits.
Who Needs Vacation Rental Insurance?
You likely need this coverage if:
You rent your home short-term (even occasionally)
You list on Airbnb, Vrbo, or Booking.com
You own a second home or investment property
You want protection beyond platform guarantees
Local regulations and tax guidance (such as IRS rental income rules) can also affect your insurance needs.
How Much Does Vacation Rental Insurance Cost?
Costs vary based on:
Property location
Rental frequency
Property value
Coverage limits
Many owners are surprised to learn that proper coverage is often more affordable than expected, especially compared to the cost of an uncovered claim.
Get the Right Coverage with Wexford Insurance
At Wexford Insurance, we help vacation rental owners secure coverage that actually protects them—without paying for unnecessary extras. Our team understands short-term rental risks and works with top carriers to find the right fit.
Frequently Asked Questions
What’s the difference between vacation rental insurance, landlord insurance, and homeowners insurance?
How much does vacation rental insurance typically cost per year?
What does vacation rental insurance actually cover for property and liability?
