Host insurance

What is host insurance?

Using home-sharing sites like Airbnb and Homestay has become a popular way for homeowners to make some extra money.

But along with the added financial benefit, using your home like this also increases the risk of incidents like accidental damage and theft happening.

This can often invalidate normal home insurance policies.

Host insurance is a specialist type of home insurance designed for people to let out spare rooms or their entire homes for short periods.

It provides the top-up cover you need for hosting short-term paying guests.

What is covered?

Host insurance protects you against paying guest-related incidents. And whether it’s a bolt-on to your home insurance or a standalone policy, it can include cover for:

• Injuries to guests, also known as liability cover
• Theft or attempted theft
• Property loss or damage
• Accidental or malicious damage caused by a guest
• Fire and escape of water damage caused by guests
• Damage to a third-party property by a guest
• Legal cover - for example, if you need to evict a guest after their agreed period of stay

What isn’t covered?

You’ll need to check the exclusions on your host insurance policy, but as this cover’s designed for short-term stays it typically won’t cover guests staying longer than 90 days.

You may also not be covered for guests causing damage to communal areas, like a shared hallway, or claims that fall under standard home insurance, like damage from fallen trees or a flood.

Likewise, wear and tear and costs for cleaning or fumigation won’t usually be included. And if guests cause small breakages or minor damage, these would normally be covered by a damage deposit.

Your policy will also have a limit on how many guests you can have at your property at any given time, exceeding this will likely invalidate any claim you make. 

Does Airbnb offer its own cover?

Yes, Airbnb offers free protection to hosts called AirCover.

This provides the equivalent of $1million in damage protection (around £730,000) and $1million in host liability insurance. It also includes pet damage protection and deep cleaning protection.

But while there’s no extra charge for this cover, there are plenty of exclusions, as well as terms and conditions that could make it more difficult to make a successful claim.

It’s also important to note that AirCover isn't classed as insurance, so it doesn’t provide you with an insurance contract in the same way that home insurance does.

Instead, to make sure you’ve got enough cover and avoid being left out of pocket when you’re an Airbnb host, it’s best to take out your own separate insurance.

What kind of insurance do I need to use my home as an Airbnb?

If you’re planning on using Airbnb to host paying guests, you should make sure your home and its contents are covered.

Most standard home insurance won’t cover short-term rentals, so you’ll need to either extend your existing policy or buy add-on cover to protect against any guest-related incidents.

As an Airbnb host, it’s a good idea to take out guest-related buildings and content cover for:

Public liability - This can help cover you against injuries or damage to guests, third parties or property. For example, if legal action is taken against you because your Airbnb guest caused damage to a neighbour's house or if a guest injures themselves while in your home

Accidental or malicious damage, or theft - With strangers staying in your home, there’s a chance they might accidentally damage your possessions or, worse, try to steal or intentionally damage your property or belongings, so it’s best to take out cover for this

Fire and escape of water - Similarly, the more people staying in your home the more likely it is that someone might cause fire damage or an escape of water through things like a blocked drain or toilet

Other things you might want to cover

As well as the more standard types of home insurance, if you’re using Airbnb to rent out your home you might also want to consider cover for:

• Home emergencies - this helps cover the cost of emergency repairs to your water, gas and electricity, or fixing urgent issues to do with pests or security at your Airbnb property
• Alternative accommodation - this can cover the cost of providing alternative guest accommodation if there’s an unexpected problem with your home
• Loss of keys and replacement locks - some policies offer specific cover to payout for lost keys and replacement locks following theft or loss by a guest during a booking
• Loss of bookings - if your home becomes uninhabitable - because of a fire, for example - this can help cover any loss of income you’ll experience
• Employer’s liability insurance - if you pay people to help manage your Airbnb property, like a cleaner or gardener, this will protect you if they’re injured while in your property

Can regular home insurance cover my Airbnb if I live in the property?

No, most insurers won’t cover you if you’re letting paying guests use your home or certain rooms, even while you’re still living there.

This is because using your home to make money is classed as commercial use, which is something home insurance doesn’t cover.

Can I use my landlord insurance if I’m renting out one of my properties?

Generally, the answer to this would be no.

Most landlord insurance policies won’t cover Airbnb claims, even if they happen during a period when the property’s not being rented out to tenants.

This is because landlords usually have a strict vetting process for tenants and a minimal rental period of six months, so landlord insurance is based on a predicted risk.

With Airbnb, there are typically less stringent checks involved for guests and it increases the number of people using the property, so there’s a higher risk of a claim being made.

Instead, to make sure you’re covered you’ll need to take out host insurance.

Does home emergency cover help when you’ve got paying guests?

You’ll usually need to pay extra for home emergency cover but for unexpected problems like a broken boiler or burst pipe while you’ve got Airbnb guests, it can help cover the cost of emergency repairs.

Some policies will also pay towards replacement accommodation if the problem means you can’t stay in your home. But this may not include paying for your Airbnb guests so you’ll need to check your policy documents or speak to your insurer.

When do I need to let my current home insurer know if I’m going to start hosting?

You’ll need to contact your insurer and let them know what you’re planning to do before you start using your home for Airbnb hosting or any type of short-term let.

If you don’t let your insurer know beforehand, this could invalidate your policy and mean you’re left without any home insurance.