If you live in Nashville, you’ve probably heard a thing or two about short term rental properties, or home sharing. In case you haven’t, suffice it to say that thousands of visitors descend on our fair city each week and take up temporary residence in owner-occupied homes and short term rental properties. But are these short term rentals covered by your homeowners insurance policy? Let’s find out!

For many homeowners, the hoards of music-loving tourists offer a golden opportunity to make some extra cash. If you’re thinking about getting in on the Airbnb or HomeAway game, however, it’s important to make sure that you’re protected from liability and that your home is protected from potential damages. So before you start seeing dollar signs in your windows, take a moment to review your policy information with a licensed Nashville insurance agent.

Before you do anything, be sure to actually speak with an insurance provider to understand what your existing policy does and does not cover. While online access is great for many things, making sure your home and your assets are protected should you choose to rent your property on the weekends is not one of them. Furthermore, before you rent your home, be sure to screen your candidates carefully. You may even want to make sure that they have their own homeowners insurance or renters insurance policy.

Is Home Sharing Covered By Homeowners Insurance?

To keep it simple, in most cases, no. You may be covered if you rent your home as a one-time deal, but if you plan on renting it multiple times, your homeowners policy will not cover losses or personal liability. If a guest damages your property or steals from you, a typical homeowners policy will not provide reimbursement. Furthermore, if a guest harms themselves while staying on your property, they may hold you liable for damages. So if you’re thinking about going down the Airbnb path, be sure to talk to your agent about home sharing endorsements or business insurance policies.

Do You Need Liability Insurance?

Yes. In order to become a permitted short term rental property, you’ll need a liability policy at least 1 million per occurrence.

Is the Personal Property of a Guest Covered by Homeowners Insurance?

Probably not. You’ll want to make it clear to your guests that they are responsible for their belongings in the event a loss occurs.

Do I Need a Short Term Rental Permit?

Yes. The Metro Government of Nashville and Davidson County requires homeowners to file for a short term rental permit from Metro Codes. In order to obtain a Type 1: Owner Occupied permit, you must bring all required documentation and apply in person at the Metro Codes Department. Be prepared to submit a floor plan, the name and number of the responsible party, proof of liability insurance of not less than 1 million dollars per occurrence, proof of written notification to owners of all adjacent properties, proof of residency, confirmation that you’re not violating any homeowners’ association rules, and a statement legally affirming that all of this is true.  

Does Airbnb Provide Host Insurance?

Yes. “The Host Protection Insurance program now provides primary coverage for Airbnb hosts and landlords, as additional insureds, in over 15 countries. Our program protects against liability claims up to $1 million USD that occur in a listing, or on an Airbnb property, during a stay.” However, it’s still important to speak with your insurance agent to make sure that your homeowners insurance offers adequate coverage as well.

What Happens If I Don’t Get a Permit?

If you operate a short term rental property without a permit, Metro may enforce a mandatory one-year waiting period before you can apply for a permit and legally operate your short term rental. From an insurance standpoint, if you’re operating a short term rental without adequate insurance, you’re putting yourself, your home, your finances, and your family at great risk. Protect your investments with the right insurance.

Ready to become a great host? Contact Royce Williams Insurance for great coverage.

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