Short Term Rentals Insurance In Florida

Short-term rental businesses in Florida face a unique combination of risks that standard homeowners or landlord insurance policies are not designed to cover. The state’s high exposure to natural disasters, combined with the constant turnover of guests, makes specialized insurance not just a good idea, but a necessity for protecting your investment.   

Why Standard Policies Are Not Enough

• Business Activity Exclusion: Most standard homeowners and even some landlord policies have a “business activity exclusion.” When you rent your property for a fee, it’s considered a commercial venture. If a claim arises from a business-related incident, your insurer will likely deny the claim, leaving you with no coverage.   
• Liability Gaps: While homeowners policies offer personal liability coverage, it typically does not extend to paying guests. If a guest is injured on your property, you could be left to pay for medical expenses, legal fees, and potential settlements out of pocket.   
• Property Damage by Guests: Standard policies may not cover intentional damage or theft caused by a paying guest. This is a primary risk in short-term rentals.   
• Vacant Property Clauses: Many standard policies have clauses that void coverage if the property is vacant for an extended period, which can be an issue during your off-season.   

Essential Coverages for Florida Short-Term Rentals

A proper short-term rental insurance policy is a commercial business policy that combines elements of homeowners and commercial liability insurance. It should include:   

1. Commercial General Liability: This is the most crucial coverage. It protects you from claims of bodily injury or property damage to guests, visitors, or even a neighboring property. Many Florida cities and counties require a minimum of $1 million in liability coverage. This includes legal defense costs, which can be substantial.   
2. Building and Contents Coverage: This protects the physical property, including the structure of the home, its contents (furniture, appliances, electronics), and other structures (sheds, detached garages). A good policy will offer:   
   • Open Perils Coverage: This covers any cause of damage unless specifically excluded in the policy.
   • Replacement Cost Value (RCV): This pays to replace damaged items with new ones, without deducting for depreciation.   
   • Coverage for Guest-Caused Damage: Look for a policy that explicitly covers theft, vandalism, and other intentional damage caused by a renter.   
3. Business Revenue Protection: If a covered peril, such as a fire or hurricane, makes your property uninhabitable, this coverage will reimburse you for the lost rental income while repairs are being made. This is essential for protecting your cash flow.   
4. Florida-Specific Endorsements: Given the unique risks in Florida, you should look for policies that offer specific coverage for:
   • Hurricane and Windstorm: This is a primary concern. Ensure your policy has adequate coverage and that you understand the separate, often high, percentage deductible for hurricane damage.   
   • Flood Insurance: Standard policies do not cover flood damage. You will need a separate flood insurance policy, typically from the National Flood Insurance Program (NFIP), especially if your property is in a high-risk flood zone.   
   • Amenities: If you have a pool, hot tub, golf cart, bikes, or small watercraft for guest use, ensure your liability coverage extends to these amenities, both on and off-premises.   

How to Find the Right Policy

• Work with a Specialized Agent: Do not rely on a standard homeowners agent. Find an independent insurance agent or brokerage that specializes in short-term rentals and has experience in the Florida market. They can help you navigate the complexities of state and local regulations and find carriers that offer comprehensive packages.   
• Platforms are Not Enough: While platforms like Airbnb and Vrbo offer some level of “Host Protection” or “AirCover,” these are often secondary and may have significant limitations, exclusions, and lower coverage limits than a dedicated commercial policy.   
• Disclose Everything: Be transparent with your agent about your property’s use, including rental frequency, amenities offered, and whether you also use the home as your personal residence. This ensures you get the proper coverage and avoids any surprises in the event of a claim.