To you, big events like the St. Paul Winter Carnival, the Irish Fair, the Minneapolis Aquatennial, and the Pride Festival are not just fun celebrations. They're a chance for you to make some money by renting out your place through crowdsourced rental sites. While it's all well and good that your home can provide some extra cash, you need to think about how home insurance covers you in case you're paying guest damages a room or is injured while on your property.
According to the Insurance Information Institute, your home insurance will typically cover your paying guests for one occasion. If they start a fire or fall down the stairs, you're covered for property damage and liability as if they were non-paying guests. However, you typically need to inform your insurance company in advance. You may need to buy a policy endorsement that covers paid renters.
But if you plan on renting part or all of your home regularly, you've suddenly started a business. You may need to buy commercial insurance as well as get a license from local government for your enterprise. If you're looking to rent for an extended period, such as six months, you may even need landlord insurance because you've created a tenant situation.
What Isn't Covered
Keep in mind that your insurance policy is meant to cover you and not your guest. So if a fire damages your property, your policy will cover damage to your possessions, such as the bed and carpet. But it won't cover any property owned by the guess, such as his luggage or laptop. A guest would most likely be covered by his own renters or homeowners policy. Certain types of travel insurance, if purchased by the guest, may cover his property as well.
What to Do
If you're even thinking of renting your home out either for a single event or as a business, the first person you should contact is your agent. Explain your plans in as much detail as you can, so she can advise you on what your insurance covers, what exclusions apply, and what additional coverage you may need.
If you do decide to continue with the rental, your best protection is to vet your renter as much as possible.
Follow the guidelines offered by crowdsourcing rental sites on how to host effectively. Their tips typically advise you to read profiles and reviews of guests, look for verified profiles, create house rules, and give your guest a list of numbers to call in case of emergency.
Contact Value Plus Insurance today for more information about how to cover your home when renting it out for the weekend or a few weeks! You can find us online or give us a call at 952-435-0550.