Vrbo is a trusted and popular vacation rental booking platform and a great way to make money through short-term rentals. But before you list your property, it’s important to have protections in place to safeguard your rental home and its furnishings.
In this article, we’ll analyze the liability protection offered to hosts by Vrbo and highlight the important factors to consider when purchasing an insurance policy for your Vrbo property. We think that by the end of this quick read, you’ll agree with our recommendation of Proper Insurance as the best insurance for Vrbo vacation rentals for owners.
Why You Need an Insurance Policy for Your Vrbo Property
Accidents happen. Imagine that a guest checks in and somehow gets injured, causes damage to your or a neighbor’s property, or other untoward circumstances. You want to make sure you have a strong safety net in these types of situations in the form of a thorough insurance policy.
When setting up your property as a Vrbo short-term rental, you’ll need a comprehensive insurance plan tailored to the unique conditions Vrbo requires of their hosts.
In contrast to Airbnb, which allows hosts to live on the property and rent out just part of the property, Vrbo requires their hosts to rent out their entire property. This presents a whole different set of insurance coverage needs that most insurance companies can’t provide.
Homeowners Insurance Isn’t a Fit for Vrbo
You might think you’re covered by your existing homeowners insurance. However, a standard homeowners insurance policy isn’t appropriate, since Vrbo won’t allow you to occupy the property while renting it out through their platform; since the short-term rental is considered a business pursuit in the eyes of the insurance company, it effectively voids the homeowners policy.
A landlord policy also isn’t enough, since short-term renters won’t be considered “tenants.” Neither is a commercial insurance policy appropriate since it doesn’t include a broad liability or loss of income coverage for Vrbos and short-term rental properties.
Vrbo Liability Insurance Has Limitations
When you list your property with Vrbo for vacation rentals, you are immediately covered by their $1M Liability Insurance through the provider Generali Global Assistance at no additional cost to you as the host.
But this does come with a little catch: you are only covered on stays that are processed through the HomeAway platform; anything otherwise isn’t covered.
The Vrbo policy offers up to $1 million in primary liability coverage per year per property for claims of injuries to guests and damage to the property of a third party (like a neighbor). But that’s as much protection as you get from them. As you may notice, while a million dollars worth of insurance coverage is a lot, it does come with a lot of exclusions and limitations.
What to Look For in a Vrbo Insurance Plan
Now that you know you’re on the hunt for an insurance plan tailored to the unique situation that is a short-term rental through Vrbo, there are a couple of things you need to carefully look for while shopping around for the best Vrbo vacation rental insurance for you.
Loss of Income – One of the most important considerations you need to look at in a Vrbo insurance policy is that it should cover loss of income. Unforeseen circumstances like sudden repairs or renovation, damage from a natural calamity, fire, and the like will cost you precious time and resources and will prevent you from renting out your Vrbo property. All that lost income while your property is being repaired will be recouped with the appropriate insurance policy.
Property and Contents Insurance – Nothing beats having the peace of mind that your property and everything in it—furnishings, furniture, bedding, appliances, etc—is protected by your Vrbo insurance coverage. Any repair or need for replacement can and will be covered, so you can make sure you can offer the best amenities for your guests.
Liability Coverage – Perhaps one of the most important aspects of an insurance policy is liability coverage. The liability insurance should be very comprehensive to cover you in the event of, say, a guest falling down a flight of stairs and breaking their leg, or if a guest should cause damage to your neighbor or other third parties.
Location-Specific Coverage – Natural disasters such as floods, earthquakes, and even fires are unfortunate but inevitable occurrences. This means a significant loss of income and property damage; your Vrbo insurance should be able to cover this as well.
No Forced Entry Requirement for Damage or Theft – Many commercial and landlord policies would require you to provide proof that your property was forcibly entered in the event of theft or property damage. Read the fine print and look for an insurance policy that won’t require this clause so you can be confident that your Vrbo property and its contents are covered.
The Best Insurance for Vrbos
Fortunately, in recent years a few insurance companies have dove into the market of short-term rentals. The first of these was Proper Insurance, which offers policies that are custom-fitted to cover the unique and specific needs of short-term rental properties.
Proper Insurance
Proper Insurance is handpicked by HomeAway (Vrbo’s parent company) and endorsed as its insurance company of choice! If that isn’t enough to convince you to have them cover your property, we don’t know what is.
Proper Insurance offers comprehensive coverage for your Vrbo vacation rental property with its $1 million general liability coverage (that can be extended to up to $2 million). They will have your back in everything we just mentioned above that you need to look for in a Vrbo insurance policy. Proper’s policies blend elements of homeowners, commercial, and landlord policies in order to completely protect you, your guests, and your property.
They even extend their insurance coverage to pets and animal liability, off-premise amenities (like golf carts, jet skis, etc.), liquor liability, bed bug infestation protection, and even squatter protection (yes, this happens).
Proper Insurance covers you in any occupancy type, so even when you do decide to move in and use your property for your own use, you won’t be breaking any clauses in your insurance policy, and you can be sure that your insurance still protects you as the homeowner. Click here to get a quick 5-minute quote on their services!
Other Vrbo Insurance Policy Alternatives
There are also other insurance companies that offer solid options for your Vrbo vacation rental property.
CBIZ Vacation Rental Insurance – Along with Proper Insurance, CBIZ is one of the key players in the vacation rental insurance providers. Founded with the vision to cater to the unique needs of short-term rentals and vacation homes, they are a solid option to cover your Vrbo property.
Allstate HostAdvantage – The HostAdvantage by Allstate program is an option that serves as a supplement to your existing Vrbo insurance policy.
American Family – American Family offers a great budget option for your Vrbo property, especially as they offer specific coverages for vacation and second home insurance which fit with Vrbo’s unique conditions of non-occupancy of properties that you rent out.
Final Thoughts
You’ll definitely want to protect your Vrbo short-term rental so you can get the most out of your property and your short-term rental business. Vrbo’s distinctive set of insurance needs warrants a unique insurance policy. Proper Insurance is a great place to start, especially when they’re the choice insurance company by Vrbo. CBIZ Vacation Rental Insurance, HostAdvantage by AllState and the vacation and second home insurance plans offered by American Family are also great additions to your existing insurance policy to make sure that you, your guests, and your property are covered.
