Have you ever rented out your primary home while you were on vacation or rented out the home for a little extra money throughout the year? Home sharing websites are increasing the exposure for homeowners who participate and owners of these properties don’t typically think to call their insurance professionals and ask if their insurance is adequate for this type of exposure.
Some homeowner carriers may not provide any coverage for a home being rented out while others may include limitations. For example, one limitation on a homeowners policy when a home is rented out is there is no theft coverage of personal property from any part of the residence that is rented out. The solution to cover theft is to add on an endorsement for an additional premium if offered by your insurance carrier.
Another limitation is the Personal Liability coverage; the policy states Personal Liability and Medical payments to others is excluded unless the home is rented out on an occasional basis for use as a residence. The definition of occasional is determined by either a claim rep or the courts and if it is determined the rental was on more than occasional basis liability coverage would not be provided.
If the rental agreement also includes the tenant’s use of your recreational vehicle and/or watercraft the policy also excludes coverage for any recreational vehicle or watercraft if rented to other’s. So make sure your tenant has coverage for these types of vehicles.
There are insurance companies that offer a Policy to provide coverage for those who rent out their home and would cover the exclusions discussed previously. Call your insurance agent today to discuss your options if you participate in a home sharing program and make sure you are adequately insured.