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Short term rental insurance is for owners who let a holiday house, an investment apartment or a few rooms to paying guests, through a booking platform or a local agent. The damage protection a booking platform offers is not an insurance policy in your name, and in an apartment block the owners corporation insures the building, so your own policy usually picks up contents, lost bookings and liability. Fortis Risk Solutions compares wordings across insurers and checks how each treats theft or malicious damage by a paying guest, a common gap. If guests leave damage behind, we help you lodge the claim. Have your last twelve months of bookings handy, then call 03 7046 3766 or send an enquiry.
What Short Term Rental Insurance Covers
Short term rental insurance covers the building or contents, the booking income and the owner's legal liability for a property let to guests by the night or the week. It suits holiday homes, city apartments, serviced apartments, B and Bs and farm stays. The policy names short stay letting in the schedule, which an ordinary home policy or a long term landlord policy does not.
The losses come from a steady turnover of strangers. A guest holds a party and the lounge suite, the carpet and the neighbour's fence are damaged. A towel left over a heater starts a fire. A child slips on wet pool tiles. Keys go missing and every lock has to be changed. A storm closes the house in January and the summer bookings are cancelled.
Insurers treat paying guests differently from family and friends. A home policy is written for the people who live there, and letting the property for payment can change what it covers. Guests who are injured can bring a claim against the owner. That is why public liability insurance sits at the centre of the package. In an apartment building, owners corporation rules apply to guests as well.
Fortis Risk Solutions arranges short term rental insurance for owners in Melbourne and holiday areas across Victoria from offices in Box Hill and Hawthorn. It is part of our business insurance range. We ask how the property is let, who manages the bookings, how often you stay there yourself and what the guests can use, then compare insurers that write short stay letting.
Who this covers
Businesses in this group include:
- Holiday homes and beach houses
- Apartments let on booking platforms
- Serviced apartments
- B and Bs and guest houses
- Farm stays and rural cottages
- Owners corporations with short stay units
If your business is not listed, ask us. The sections below are the starting point for any business in the group.
Short Term Rental Insurance: Cover Sections and Benefits
Related Client Case Studies
Cases from the Fortis Risk Solutions broking team. Client names have been removed.
Client case: Tenant’s Malicious Damage and Loss of Rent
The client situation: During a routine property inspection, the property manager discovered significant intentional damage to the rental property, including holes in walls, damaged doors and broken fixtures. The tenants were subsequently issued a notice to vacate the property.
Once the tenants vacated, the extent of the damage meant the property could not be immediately re-let, resulting in the landlord losing rental income while repairs were completed.How the policy responded: Where Malicious Damage by Tenants was covered, the Landlord Insurance policy helped cover eligible costs to repair and restore the damaged property.
Where the policy also included Loss of Rent cover, it helped cover eligible rental income lost while the property remained unable to be rented as a result of the insured damage.How Fortis Risk Solutions helps: Malicious damage and loss of rent are not in every landlord policy. We compare the wording across insurers and tell the owner which ones include both.
Client case: Tenant Injured at the Rental Property
The client situation: A tenant was walking down the property’s external stairs when a defective handrail gave way, causing the tenant to fall and sustain an injury. The tenant subsequently made a claim against the landlord, alleging the property had not been adequately maintained.
How the policy may respond: Where the landlord was found legally liable for the tenant’s injury, the Legal Liability section of the Landlord policy may help cover eligible compensation and legal defence costs.
How Fortis Risk Solutions helps: An ordinary home policy may not cover liability to a tenant. We make sure a rental is on landlord wording from the day it is let.
Every policy is different and the outcome of a claim depends on its terms. As your broker, Fortis Risk Solutions compares insurers and policy wording before you buy, and lodges and manages the claim for you when something happens. Talk to us about your own cover.
Short Term Rental Insurance FAQs
Often not, or only in part. Many home and contents insurance policies exclude or limit loss when the property is let for payment. Some also restrict cover for theft or damage by people you invited in. Check the wording rather than assume. If you let the whole home or a room to paying guests, tell your insurer or move to a policy that names short stay letting.
Not without checking the wording. Standard landlord insurance is written for a tenant on a residential lease, and many policies exclude or limit short stay and holiday letting. Some insurers offer holiday rental insurance as an option or as a separate policy. Declare the short stay use, because an undeclared change of use can give the insurer grounds to reduce or decline a claim.
Yes, where the policy includes a loss of rental income section. It pays the booking income you would have earned while the property cannot be let after insured damage, up to the limit and period in the schedule. The idea is the same as business interruption insurance for a shop. Cancellations for other reasons, such as a guest changing plans, are not an insured loss.
In most cases, yes. Protection offered by a booking platform is set by the platform, carries its own limits and exclusions, and can change without reference to your property. It is not built around your building, your contents or your income. Owners looking for insurance for Airbnb hosts should treat a platform program as a backstop and hold a policy in their own name.
In most apartment buildings the owners corporation insures the building and common property under its strata insurance. The unit owner insures the contents, their own liability and the booking income. Tell the owners corporation's broker that the unit is let short stay, because the strata policy may need to know about the use. Your guests also have to follow the building rules on noise, parking and common property.
Short stay wordings differ on owner occupancy, guest damage limits, management arrangements and how lost bookings are calculated. FRS helps you disclose how the property is actually let, set sums insured for the building, contents and income, compare insurers that write short stay letting and act as your advocate at claim time. A B and B or serviced apartment with staff and meals may fit better under a business insurance package.
It depends on how the property is let. Start with whether the insurer has agreed to paying guests at all, since a standard home policy is written for the people who live there. After that, compare cover for malicious damage and theft by guests, and whether lost booking income is paid while insured damage is repaired. Host protection from a booking platform has its own limits and conditions, so read it alongside your policy rather than instead of it. We compare these points across insurers for holiday homes and apartments.
Talk to a broker about Short Term Rental Insurance
Call 03 7046 3766 on weekdays between 9:30am and 6pm, email admin@fortisrisksolutions.com.au, or send an enquiry and a broker from our Box Hill or Hawthorn office will come back to you about short term rental insurance. Tell us what the business does and what the lease or contract asks for, and we take it from there.