What To Know When Renting Out Your Home

Smart Insurance Tips

As the busy season approaches, it’s important to know that your Homeowner policy may include coverage exclusions or limitations related to rentals. The duration, frequency, and method of renting out your home can all impact your insurance coverage.

Here are a few important tips to keep in mind:

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1. Notify your insurance broker about your rental plans. Failing to inform your insurance carrier before renting may lead to claim denials or even cancellation of your policy. 
2. Understand how your insurance carrier treats Primary vs. Secondary homes. Each carrier has its own stance on rentals—some do not allow renting out a Primary residence at all.
3. Be aware of how the rental frequency impacts coverage. Many policies offer continuous coverage for monthly or seasonal rentals (e.g., Memorial Day through Labor Day) when renting to a single tenant. However, frequent short-term rentals to multiple tenants may be considered a business exposure and excluded from coverage.
4. Home-sharing platforms may trigger coverage exclusions. Renting through sites like Airbnb, VRBO, or HomeAway can affect your policy. Be sure to check for any exclusions or limitations.
5. Require tenants to carry liability insurance. Ask tenants to provide proof of liability coverage. They may be able to extend coverage from their primary home, or purchase a Rental and Umbrella policy for the rented property.
6. Renting increases your liability exposure. Make sure your personal liability limits are adequate, and that all homes you own or rent are listed on your Excess Liability (Umbrella) policy.

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