The cost of commercial vacation rental property insurance and liability coverage is usually a consideration when deciding which policy to purchase, but it shouldn’t be the only factor you evaluate.
You want a policy that will provide adequate rental property coverage for damages, as well as liability for renters or others injured on the premises.
When insurers evaluate applications for vacation rental property insurance coverage, there are several factors that go into their decision of whether to offer coverage, or to offer coverage with exclusions:
- Amenities & Activities on the Premises. If your vacation property includes one or more features that could raise the risk of loss, coverage for that item or feature will generally raise the price you’ll pay for the insurance policy. For example, swimming pools, docks and piers, small watercraft, and exercise equipment could raise the risk of a renter being injured on the premises. Other types of perils such as zip lines, trampolines, tree houses, and animals may all help you attract renters and earn more income per night or per week. However, your policy may specifically exclude these types of risks to reduce liability opportunities.
- Other Business Activities. Sometimes, vacation rental property owners also operate other types of businesses on the premises, in addition to the property rental activity. For example, a beach-front property might offer ATV rentals to the public. In such cases, separate insurance policies would be required to cover any losses associated with that business.
- Safety Considerations. To obtain coverage at the most affordable rates, your property should be as safe as possible for renters and guests. Property owners who have installed and maintained even walkways, porch railings, handrails, working smoke alarms, fire extinguishers, carbon monoxide detectors, and other safety features, have demonstrated their commitment to mitigating risks to their tenants. CBIZ Vacation Rental Insurance offers rate reductions for central station fire alarms, central station burglar alarms, sprinkler systems, claims free history
- Safety Inspections. Certain properties, including those for which the property owner is requesting a high total insured value, can be subject to inspection by a third-party inspection company before the vacation rental policy can be issued. The inspection of your vacation property’s interior and exterior is designed to evaluate how safe your property is and identify potential areas of concern. You may be required to address certain safety risks immediately.
- Cost Comparisons. Comparing a quote for vacation rental insurance to a quote for homeowner’s insurance is not an apples-to-apples comparison, because the two types of policies are very different. Homeowner’s coverage generally excludes business activities, including short-term rentals of the property. Commercial vacation rental property insurance, on the other hand, is specifically designed to protect property owners from both the liability risks and property risks that can come with renting their vacation homes. It also includes provisions designed to help protect your rental income if your property is damaged and requires repairs covered by your policy.
Understanding these considerations can help you make informed decisions when you shop for vacation rental property coverage.
Protect your vacation home with CBIZ Vacation Rental Insurance. Are you ready to get a quote? It’s quick and easy! All we need is some basic information about your rental property. You can also contact our sales professionals at 888.883.5696 between 9 a.m. and 5 p.m. MST, Monday – Friday, or anytime via email at VacationRentalSales@cbiz.com.