Article

Short-Term Rental Insurance 2026: What AirCover Leaves Out

October 26, 2026

Written by

Rob Abasolo

Host Camp has a referral partnership with Steadily. If you sign up through our links, Host Camp may earn a commission at no cost to you.

If you host on Airbnb, AirCover for Hosts pays for 2 things: Damage a guest causes to your property, up to $3,000,000 per stay, and your liability when a guest is hurt, up to $1,000,000 per stay. It does not pay for damage nobody caused, such as a worn-out water heater, and it pays lost bookings only when a guest-caused loss forces you to cancel. A short-term rental (STR) insurance policy covers the property itself. We compare 4 insurers that publish what their policies cover.

What AirCover for Hosts Covers

AirCover for Hosts has 2 parts. The first is Host Damage Protection. Airbnb’s Host Damage Protection Terms say Airbnb will “guarantee the Responsible Guest’s primary obligation” to pay you, so Airbnb pays only if the guest does not, and the terms “are not an insurance contract.” An eligible loss is “Physical loss or physical damage to a Host’s Eligible Property directly caused by the Responsible Guest or an Invitee.” The cap is $3,000,000 per Airbnb stay, and payments are reduced by anything already paid from another source, such as your insurance, a security deposit, or the guest.

A claim has 2 deadlines. “Within fourteen (14) days of the Responsible Guest’s checkout date,” you must try to recover the cost from the guest and notify Airbnb. “Within thirty (30) days of the Responsible Guest’s checkout date,” you must file the payment request form with evidence of the loss, its amount, and its cause.

The second part, Host Liability Insurance (HLI), is an insurance policy. Airbnb’s program summary says “$1,000,000 USD is the total limit available per Airbnb Stay.” It covers your liability for injury or property damage to guests or others during a stay. In the US, in certain instances, it is “underwritten by a non-admitted insurer,” and the summary says it “is not protected by the insolvency guaranty fund.” Since March 1, 2025, “if a Host has 6 or more active Airbnb listings at the time of loss, the HLI program may require contribution” from your other insurance.

What AirCover Leaves Out

If a guest did not cause it, Host Damage Protection does not pay for it.

Wear and failure. Section 6.4.7 excludes “deterioration, depletion, rust, corrosion or erosion, inherent vice or latent defect,” and “the degradation in condition or loss of function or efficiency of property over time due to use, age, lack of maintenance, or any combination of these.” A water heater that fails on its own falls here.
Mold. Section 6.4.8 excludes any loss “directly or indirectly arising out of or relating to mold,” mildew, and fungus.
Lost bookings without guest damage. Booking income loss covers only confirmed reservations that “Were on the Airbnb Platform and in force prior to the established time of the related Eligible Loss,” and only when that guest-caused loss makes the property uninhabitable.
Liability exclusions. The liability summary lists, among others, assault and battery, communicable disease, fungi or bacteria, “aircraft, autos, and mobile equipment,” most watercraft, and liability “they have assumed” by contract.

As an example only, take the $400,000 property from our tax-loophole post. A guest backs into the garage door: Host Damage Protection applies once the guest refuses to pay.

The water heater floods the basement between stays, and the house is offline for 3 weeks: The terms pay nothing for the repair or the 3 weeks of bookings, because no guest caused the loss. A guest slips on the deck and sues: Host Liability Insurance responds up to $1,000,000, subject to its exclusions.

What a Homeowner’s Policy Excludes

State insurance regulators say a standard homeowner’s policy may not cover a rental. The Mississippi Insurance Department says “Most Homeowners or dwelling insurance policies are not designed to cover accidents arising from short-term rentals.” It adds that “Many policies contain a business exclusion that eliminates liability coverage for bodily injury or property damage,” and that a host who rents often may find the activity “defined in the policy as a home-based business.”

The District of Columbia’s insurance department, in a 2015 consumer guide, says homeowner’s policies “usually exclude or provide very limited coverage for homeowners who are running a business in their home,” and that your insurer “may deny coverage for any resulting claims.” The guide names 2 alternatives: An endorsement from your current insurer for occasional rentals, or a landlord policy for regular ones.

4 Short-Term Rental Policies Compared

Listed alphabetically, each figure from the insurer’s own page. “Not published” means the page does not state it.

Insurer	Type	Liability limit	Damage to your property	Lost income	Published limits on use
American Family	Add-on to a homeowner's policy	Not published	Covered events, after a deductible, up to policy limits	Not published	Home "rented out for 62 days or less a year"
Proper Insurance	Policy written for the short-term rental	$1,000,000 per occurrence, $2,000,000 available	Special-form building and contents at replacement cost; "No sub-limit on damage caused by a renter"	Business income on "actual loss sustained," with no time cap	All 50 states and Washington, D.C.
Safely	Coverage that "activates per booking" through your property management system	Up to $1,000,000 for guest injury	Guest-caused damage; contents "Up to $10,000"	Booking income on its home page; limit not published	"Not available in all states"; claims within 60 days of checkout
Steadily	Short-term rental policy for stays of 30 days or less	$300,000 to $2,000,000 per occurrence on its landlord policies	Structure, fire, water, and furnishings; limits not published	Loss of rent, usually capped at 12 to 24 months; the page does not say how short-term income is measured	Stays "as short as one night"

The table holds 3 kinds of cover. American Family’s add-on applies to a home rented 62 days a year or less, which excludes a full-time rental. Safely’s coverage applies booking by booking, through your property management system. Proper and Steadily write the rental as its own policy, with income cover after a covered event.

The income measure differs. Steadily describes loss of rent as “fair rental value coverage.” Proper pays business income from “the gross revenue your rental would have earned,” and says landlord loss of rents averages comparable rentals, long-term ones included. On the 3-week closure in our example, that measure sets the payment.

The only cost figure any of the 4 publishes is Steadily’s: A short-term rental policy runs “roughly 15% to 25% more than the landlord policy you would buy” for a long-term tenant. It gives no dollar amount.

Host Camp partner: Get a Steadily quote, or read our Steadily partner page. Ask Proper for a quote on the same property so you compare 2 policies written for short stays.

If you are financing the purchase, our lender locator connects you with mortgage lenders. For what to do on the day a guest damages something, see Your Guest Broke the Bed.

For related reading, see Should Your Airbnb Be in an LLC? and How to Start an Airbnb.

What to Ask Each Insurer

AirCover covers what a guest does to the property. In our example, Airbnb covers the garage door, and the 3-week water heater closure falls to a policy you buy. Before you compare premiums, ask each insurer in writing 3 things: Whether it covers a home rented for stays of 30 days or less year-round, how it measures lost short-term booking income, and whether it pays before or after AirCover. Book a free strategy call and we will look at your numbers with you.

Host Camp is not a licensed tax, legal, or financial adviser. Confirm figures for your situation with a professional.

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