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Will my homeowners coverage cover my condo if it's a rental?

I am wondering if my homeowners liability coverage on my HO6 Condo policy still applies when my condo is rented out on a short-term lease.

Mar 29, 2024 Destin, FL

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Nathan Foster

Agency Trainer

Credentials
  • Licensed Insurance Agent - Property and Casualty

Nathan is an insurance professional with a focus on creating positive customer experiences with more than 10 years of industry experience.

Nathan tra…

Thank you for reaching out to The Zebra!

Your HO-6 (condo insurance) liability policy will not cover your condo while it's being used as a short-term rental. This has become a much more common scenario over the last few years as remote work and home-sharing websites are increasingly popular. Renting out your condo means that if someone who's staying there gets hurt, they could potentially sue you. Unfortunately, we live in a "sue happy" world. Even if a tenant tripped and scratched their arm there is a potential lawsuit. The insurance company would find out that they were one of your tenants, and deny the claim because you never informed them the home was rented out.

Because you'd have multiple staying in your home (more than if it was a traditional one-year lease, for example), this opens you up to more chances of being sued. This is what we call a risk factor in insurance. If the insurance company doesn't know or rate that risk on the policy, they can deny a claim resulting from that risk.

By operating a short-term rental (also known as a vacation rental, or referred to by the top websites like Airbnb, HomeAway, and VRBO) you are running a business, in the eyes of an insurance company. Often, liability is excluded if a claim is related to the home-based business. I suggest reaching out to your insurer to discuss the situation with them; there may be endorsements you can add for home-sharing or an"Airbnb" operation.

If your current insurance company doesn't have a good option for you, there are specific carriers that have developed policies designed for short-term rentals. For example, Allstate HostAdvantage, Proper Insurance, and Erie Homeshare. Regardless of the route you take, if you're turning a primary home into a rental we always recommend reaching out to discuss this with your insurance company.

If your current insurer doesn't offer the right options, feel free to call our knowledgeable agents at 1-888-255-4364 and we can help find the right home coverage for your situation.

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