Bradenton has long been known for tourism and snowbirds, making renting out a spare room or home an enticing proposition. Companies like Airbnb and Vrbo have shaken up the market and made short-term room or house rentals more attractive to many visitors compared to hotels or other traditional overnight accommodations. Having someone else live in your home for any period of time might have you wondering about the liability you have for their safety and security. Depending on how you rent out your property, you may or may not have some protection from a company like Airbnb. While accidents are rare and most homes are safe, the unexpected is always a possibility. You should be well informed about the risks and insurance liability implications of renting out your home – and know about the protections offered by landlord insurance.
Homeowners Insurance, Landlord Insurance – What Covers What?
Owning a property usually means you have a homeowners insurance policy to go along with it. Your homeowners’ policy will provide coverage for thefts, burglaries, and damages and losses of your home or property. Almost all homeowners insurance policies also come with liability insurance, which will protect you in the case someone injures themselves on your property. Your insurance will pay for court fees associated with any civil suits, help negotiate payments and settlements, and pay out compensation up to your policy’s monetary limit. You might be thinking, “Great! My policy covers people who stay at my property!” However, troubles may arise when your insurance company discovers who suffered the injury and why they were there.
Most homeowners’ insurance policies will argue against your claim if they perceive you to be using your personal homeowners’ policy as part of a business. If you have guests often renting out a spare room or entire home through a company like Airbnb, you might be classified as running a hotel or bed and breakfast by your insurance company. Reading your policy in full can help you get a complete understanding of the limits of your policy. Any further questions, such as the frequency of guests that would preclude you from making liability claims, should be hashed out with a representative from your insurance company. Because laws and policies vary, you’ll want to be clear on what your policy covers and add coverage if necessary.
In short, running an Airbnb or other similar business where you rent out parts of your home might leave you open to lawsuits if you do not take advantage of different options available through these companies and do not seek another type of insurance, such as a commercial landlord insurance policy. Airbnb, for example, provides host coverage that will cover you up to $1 million. However, if you rent out parts of your property through word of mouth or other advertisements, you will have to cover these costs yourself. The size of that coverage should give you an idea of the potential damages that an unforeseen tragic accident can cause in lawsuit and settlement costs.
With all that being said, there are definitely options for you that can allow you to safely and appropriately rent out your home to tourists and visitors to Sarasota. If you are looking to rent your home for extra income and have questions about purchasing more landlord insurance, call Anderson & Associates Insurance Group. Our insurance experts can help you to find the right coverage for your specific situation – tap into our expertise and protect yourself in your new venture.
