According to the National Association of Insurance Commissioners (NAIC), homeowners insurance policies typically allow policyholders to house borders on occasion — but “occasion” is subject to interpretation. Home sharers may also need more extensive personal liability insurance than typical homeowners policies provide. For added protection, landlord policies can help cover homeowners against risks including property damage, personal injury, legal fees, and lost rental income.
No matter the hosting frequency, however, listing a property on a home-sharing platform could result in the property being legally defined as a home-based business, which homeowners insurance policies usually exclude. In response to the sharing economy, some insurers have introduced endorsements and new policies. It’s no longer necessary for many homeowners who use sharing platforms to buy commercial insurance, which is costlier than special home-sharing policies.
Guests injured at short-term rental properties may be responsible for their own medical expenses if the companies they book their rentals through or their hosts don’t offer medical payment coverage. Similarly, guests who inadvertently damage their hosts’ property may have to pay out of pocket if their own homeowners, renters, or personal liability insurance policies don’t extend to cover their short-term rental occupancies.