What Is STR Insurance?
STR insurance fills gaps that landlord-insurance leaves—most landlord policies exclude or limit coverage when you rent by the night. STR-specific policies cover guest damage, liability-insurance for injuries, and sometimes loss of income. Airbnb and VRBO offer host protection, but it's secondary—your own STR insurance is primary. Guest-screening reduces claims; insurance is the backstop. Some cities require proof of STR insurance for str-permit approval.
STR insurance is property and liability coverage designed for short-term-rental operations—covering guest-caused damage, injury claims, and sometimes loss of rental income, which standard landlord-insurance often excludes.
At a Glance
- What it is: Insurance for short-term-rental operations—guest damage, liability, loss of income.
- Why it matters: Landlord-insurance often excludes STR use—gaps can leave you exposed.
- Key detail: Primary coverage; platform protection is secondary.
- Related: landlord-insurance, liability-insurance, guest-screening.
- Watch for: Policy exclusions—read the fine print for STR-specific terms.
How It Works
Standard landlord policy gap. Most landlord-insurance policies assume 30+ day tenants. When you rent by the night, you're in a "business use" or "commercial" category—many policies exclude or limit coverage. A guest injury or major damage could be denied if the insurer learns you're running an STR.
STR-specific policies. Carriers like Proper, CBIZ, and some regional insurers offer STR policies. Coverage: dwelling, personal property, liability-insurance for guest injuries, and sometimes loss of rental income (if the unit is uninhabitable after a claim). Premiums run 20–50% higher than standard landlord—reflects the higher turnover and risk.
Platform protection. Airbnb Host Protection and VRBO liability programs provide secondary coverage—they kick in after your primary policy. Don't rely on them alone. They have limits, exclusions, and dispute processes. Your own STR insurance is the first line.
Permit requirement. Many cities require proof of STR insurance (or equivalent) for str-permit approval. Minimum liability limits vary—often $500K–$1M.
Real-World Example
Nashville 2-bed, Proper Insurance. Marcus switched from landlord-insurance to Proper's STR policy. Premium: $1,840/year (was $1,200 landlord). Coverage: $350K dwelling, $1M liability-insurance, $15K loss of income. A guest slipped on wet bathroom tile, broke an arm. Medical bills: $12,000. Proper paid—primary. Airbnb Host Protection wasn't needed. Without STR-specific coverage, his old insurer might have denied—"business use" exclusion.
Austin condo, landlord policy. Sarah kept her landlord-insurance when she converted to STR. A guest's dog damaged the hardwood—$3,200 repair. Her insurer denied: policy excluded short-term rentals. She filed with VRBO's damage protection—they paid $2,800 after deductible. She ate $400. She switched to STR insurance the next month.
Gatlinburg cabin, loss of income. A pipe burst; unit was uninhabitable for 3 weeks. Repair: $8,000 (covered by dwelling policy). Lost revenue: $2,100 (3 weeks × $700/week). Her STR policy had loss-of-income coverage—paid $2,100. Without it, she'd have absorbed the loss.
Pros & Cons
- Covers STR-specific risks—guest damage, liability, loss of income.
- Primary coverage—you're not dependent on platform protection.
- Str-permit compliance—many cities require it.
- Peace of mind—guest-screening reduces risk; insurance covers the rest.
- Higher premium than landlord-insurance—20–50% more.
- Fewer carriers—not every insurer offers STR policies.
- Exclusions exist—read the policy for STR-specific terms.
Watch Out
- Compliance risk: Operating without STR insurance when required for str-permit can void your permit. Verify city requirements.
- Coverage gap: Don't assume landlord-insurance covers STR use. Many policies exclude it. Disclose STR use to your agent.
- Execution risk: Guest-screening reduces claims but doesn't eliminate them. Insurance is mandatory—not optional.
Ask an Investor
The Takeaway
STR insurance is essential for short-term-rental investors. Landlord-insurance often excludes STR use—gaps can leave you exposed. Get STR-specific coverage for dwelling, liability-insurance, and loss of income. Guest-screening reduces claims; insurance is the backstop. Many cities require it for str-permit approval.