Why Airbnb hosts need specialised insurance
As an Airbnb host, you're running more than just a property - you're operating a hospitality business. Standard homeowners' insurance simply won't cover the unique risks that come with short-term rentals. In 2025, with increasing regulation and guest expectations, having proper insurance coverage has never been more critical.
Consider these sobering statistics:
- 1 in 5 Airbnb hosts report property damage exceeding £1,000 annually
- Liability claims from guest injuries have increased by 37% since 2022
- 60% of standard homeowners' policies automatically void when you start short-term renting
This comprehensive guide will walk you through:
- Understanding Airbnb insurance: key coverage types
- Best Airbnb insurance companies
- How to choose the right Airbnb insurance: a step-by-step guide
- Common Airbnb insurance mistakes to avoid
- Expert tips to save on Airbnb insurance
- The future of Airbnb insurance (2025 trends)
Want to protect your Airbnb business while delivering 5-star guest experiences?
Understanding Airbnb insurance: key coverage types
Before we dive into providers, let's clarify what proper short-term rental insurance should include:
-
Airbnb property damage coverage
- Covers structural damage from fires, storms, or guest accidents
- Should include both building and contents protection
- Typical policies cover £500,000-£2 million in damages
2. Liability protection
- Essential for guest injury claims (slip-and-fall accidents, etc.)
- Look for minimum £1 million coverage
- Includes legal defense costs
3. Loss of income protection
- Replaces Airbnb rental income if property becomes uninhabitable
- Covers average daily rate for repair periods
- Often capped at 6-12 months of lost income
4. Guest-caused damage protection
- Separate from security deposits
- Covers intentional damage or excessive wear-and-tear
- Typically £5,000-£25,000 in coverage
5. Additional living expenses
- Pays for hotel stays if Airbnb guests need relocating
- Covers unexpected cleaning/repair costs
- Often overlooked but valuable coverage
Best Airbnb insurance companies (according to us)
We evaluated 17 insurance providers using 12 key metrics to identify the best options for different hosting situations. Here's our detailed comparison:
Just starting your Airbnb hosting journey? Hit the ground running with our full guide on how to start an Airbnb business.
1. Proper Insurance: best overall coverage
Proper Insurance was specifically designed for short-term rental operators, offering the most comprehensive coverage available. Unlike add-on policies, it completely replaces your homeowners insurance with a commercial-grade policy.
Coverage highlights:
- Full commercial liability up to £2 million
- No occupancy restrictions or guest limits
- Covers theft, vandalism, and malicious guest damage
- Includes loss of income protection
- Optional bed bug coverage available
Real host experience:
"After a guest's plumbing mishap caused £15,000 in water damage, Proper had adjusters on-site within 24 hours and paid our claim in full within 10 days."
- Sarah K., London
Pricing breakdown:
- Studio flat: £800-£1,200/year
- 3-bed home: £1,500-£2,000/year
- Luxury property: £2,000-£2,500/year
Pros:
- True end-to-end STR coverage
- Fast, hassle-free claims
- No hidden exclusions
Cons:
- Higher premiums than basic policies
- Requires full underwriting process
Want to reduce guest questions about property details? Touch Stay digital guidebooks cut enquiries by 40%!
2. Safely: best pay-as-you-go option
Safely offers budget-friendly guest damage protection and liability coverage, making it ideal for hosts who rent occasionally or want to supplement existing coverage with guest damage protection.
How it works:
Safely offers two products:
- Damage protection: £5-£15 per booking
- Liability insurance: £1-£2 per day
Key benefits:
- No annual contracts
- Instant coverage when booking is confirmed
- Covers up to £5,000 in guest damages
- £1 million liability protection available
Limitations:
- Doesn't replace homeowners insurance
- Maximum 90 consecutive rental days
- Some excluded items (fine art, collectibles)
Real host experience:
"I rent my London flat about 60 nights/year. Safely costs me about £300 annually versus £900 for full coverage. It's perfect for my needs."
- Mark T., part-time host
Pro tip: discover more about Airbnb essentials: must-haves for a successful rental.
3. Allstate HostAdvantage: best add-on policy
Allstate’s HostAdvantage is perfect for hosts who already have homeowners’ insurance and want to add short-term rental coverage.
Pricing:
- £300–£600/year as an add-on.
Pros:
- Integrates with standard homeowners’ insurance
- Covers theft and accidental damage
- Trusted brand
Cons:
- Limited availability (US only)
- Doesn’t cover commercial liability fully
Unique feature:
Allstate offers discounts for smart home devices (e.g., smoke detectors).
4. CBIZ: best for professional hosts
CBIZ provides specialised short-term rental insurance with strong business income protection, ideal for:
- Professional hosts who rely on rental income
- Hosts with multiple properties
- Property managers
Pricing:
- £700–£1,200/year depending on coverage.
Pros:
- Strong business interruption coverage
- Specialised in STR policies
- Covers equipment and furnishings
Cons:
- Requires maintaining separate homeowners' insurance
- More paperwork than some competitors
Unique feature:
Offers identity fraud expense coverage as an add-on.
Want to turbocharge your Airbnb hosting game?
Streamline your guest communication with Touch Stay digital guidebooks.
5. Liberty Mutual: best for high-value properties
Liberty Mutual's HostProtect endorsement provides premium coverage tailored for luxury vacation rentals and high-net-worth hosts. Their policies are ideal for properties with high-end finishes, valuable collections, or unique amenities.
Pricing:
- £1,000–£3,000/year (varies by property value)
- Luxury properties (over £1M value): £2,500–£5,000/year
Key features:
- Valuables riders (art, jewellery, wine collections)
- Domestic staff liability (cleaners, maintenance)
- Worldwide contents coverage (items temporarily removed from property)
- Enhanced liability limits (up to £5M available)
Pros:
- Specialised underwriting for luxury properties
- Dedicated claims concierge service
- Covers unique risks like fine art and collectibles
- Optional cyber coverage for smart home systems
Cons:
- Requires property appraisal for high-value homes
- Not available for properties under £250,000 value
- Mandatory security system installation
Unique policy details:
- Disappearing deductible: Reduces your deductible by £100 for every claim-free year
- Green home discount: 5-10% off for eco-friendly properties
- Seasonal adjustment: Lower premiums during off-peak months
How to choose the right Airbnb insurance: a step-by-step guide
Step 1: assess your risk profile
- Number of rental days/year
- Property value and contents
- Amenities (pool, hot tub, etc.)
- Local regulations
Step 2: calculate needed coverage
Use this formula:
(Property value × 1.1) + (Annual rental income × 0.5) = Minimum recommended coverage
Step 3: compare policy features
Create a comparison spreadsheet evaluating:
- Coverage limits
- Deductibles
- Exclusions
- Claims process
- Customer reviews
Step 4: get multiple quotes
Always get at least three quotes. Many providers offer online estimators.
Step 5: review annually
Re-evaluate your coverage whenever:
- You renovate
- Rental prices increase
- You add amenities
- Local laws change
Pro tip: keep your guests safe with our Airbnb safety guide: 10 tips for safer rentals.
Common Airbnb insurance mistakes to avoid
- Assuming your homeowners policy covers rentals
- 89% don't without specific endorsements
- Most automatically void when you start hosting
- Underestimating liability risks
- Average injury claim: £45,000
- Legal fees often exceed £15,000
- Overlooking local regulations
- Some cities require minimum £1 million liability
- Certain areas mandate specific endorsements
- Not documenting property condition
- Always do video walkthroughs
- Keep receipts for valuables
- Update documentation annually
- Ignoring business income protection
- Even 30 days of lost bookings can cost £5,000+
- Standard policies rarely include this
Expert tips to save on Airbnb insurance
- Bundle policies
- Combining auto + STR insurance can save 15-20%
- Increase deductibles
- Going from £500 to £1,000 can reduce premiums 10-15%
- Install safety features
- Smart locks (5% discount)
- Water leak detectors (7% discount)
- Security systems (10% discount)
- Maintain excellent reviews
- Some providers offer 5-10% discounts for 4.8+ ratings
- Pay annually
- Monthly payments often include 5-8% fees
The future of Airbnb insurance (2025 trends)
Usage-based pricing
- Pay-per-night models gaining popularity
- Dynamic pricing based on guest screening
AI-powered risk assessment
- Instant underwriting using property data
- Real-time claim processing via image recognition
Regulation-driven coverage
- More cities requiring proof of insurance
- Special endorsements for party houses
Integrated protection platforms
- Insurance + smart home tech bundles
- Automated claims filing through hosting apps
Conclusion: protecting your Airbnb business
Choosing the right insurance is one of the most important decisions you'll make as a host. While Proper Insurance offers the most comprehensive coverage, your ideal provider depends on your specific situation:
- Full-time hosts: Proper Insurance or CBIZ
- Occasional hosts: Safely
- Existing Allstate customers: HostAdvantage
- Luxury properties: Liberty Mutual
Remember, the cheapest policy often ends up being the most expensive when you need to file a claim. Invest in proper coverage, document everything, and review your policy annually.
Ready to elevate your guest experience while protecting your business?
Touch Stay digital guidebooks help reduce risks by clearly communicating house rules and emergency info.
