Airbnb AirCover: Why Hosts Need Further Protection

Airbnb provides AirCover as a form of damage and liability protection to all hosts listing on the platform free of charge. However, it’s important for short-term rental property owners to understand that AirCover is not really comprehensive insurance and doesn’t eliminate the need to get a third-party policy.

To safeguard their investment and protect it from the risks associated with renting out, Airbnb owners need landlord insurance. While such a policy incurs additional costs, it’s the only way to protect your property and yourself.

In this guide, we’ll explain what AirCover is, what it covers and what it doesn’t, and why you need an external policy.

What Is AirCover for Airbnb Hosts?

AirCover for hosts is one of the signature programs of Airbnb which aims to provide coverage against both property damage and owner liability. In 2021, Airbnb substituted the previous Host Guarantee program with AirCover in an attempt to eliminate the financial risk of damages sustained during guest stays.

Airbnb Aircover for hosts program includes the following:

• Host damage protection: $3 million, including both the home and its contents
• Host liability insurance: $1 million
• Experiences & Services liability insurance: $1 million
• Auto and boat protection
• Pet damage protection
• Deep cleaning
• Income loss protection
• 24-hour safety line
• Guest identity verification
• Reservation screening

Owners of single or multiple short-term rental properties first think that AirCover is a lifesaver as it protects against costly damages. However, once you consider it more carefully, the program falls short of comprehensive insurance, which calls for the need to obtain third-party protection.

How Airbnb AirCover Works

For Airbnb owners, every extra expense threatens the financial stability of their business. In this sense, AirCover acts as an important financial buffer in a range of potential situations that can develop on your property.

You can receive coverage under the following scenarios:

• A guest’s child dirties your walls beyond reason
• A careless renter breaks your fridge or laundry machine
• A guest’s cat leaves your carpet filthy
• A guest suffers bodily injury on site and decides to file a lawsuit against you
• You have to temporarily stop renting operations due to excessive property damage

The program can help navigate some financial risk and get back in business. Still, it’s key to know that this is not insurance, so it leaves aspects of your real estate investment business not protected.

Why AirCover Is Not Enough for Owners

It is true that Airbnb offers generous support to hosts for free via AirCover (though the cost is actually covered by host fees), but even the website explains that the program does not substitute proper insurance.

Let’s take a look at the program features and what gaps they leave as compared to landlord insurance policy:

Restricted to Booked Periods Only

While AirCover works when your property’s rented out to a guest, it leaves your home unprotected during vacancy. If your rental is vandalized or damaged by a storm between bookings, Airbnb does not owe you anything.

Airbnb Steps in Only After a Guest Fails to Act

Under the Airbnb policies, a host needs to file a claim via the platform, documenting damages with photos or videos. In case the guest doesn’t respond to the claim within 24 hours, refuses to pay, or covers only some of the expenses, the owner can submit a reimbursement claim under AirCover.

This results in potentially hostile exchanges with the guest, delayed timeline, and unpredictable reimbursement.

Damages Left Not Covered

Though AirCover protects against some costly situations, it leaves you unprotected against:

• Standard wear and tear typical for rental properties
• Ongoing maintenance costs
• Cleaning fees
• Natural disasters, such as earthquakes and hurricanes
• Personal property damage suffered by guests
• Damage to amenities, such as swimming pools and hot tubs
• Currency loss

This means that owners of Airbnb properties in areas exposed to natural disasters and those having on luxury amenities remain particularly vulnerable even with AirCover.

Tedious Process with No Clear Outcomes

To request reimbursement, hosts need to go through multiple steps including taking detailed photos and videos to prove damage. In all cases, there is no guarantee that Airbnb will cover any of the eligible expenses that you incur as a result of hosting reckless guests.

So, Airbnb landlords are frequently left short of the protection they need in order to operate a well-protected and successful short-term rental business.

Why Airbnb Hosts Need Further Damage Protection

Savvy Airbnb owners see AirCover as a nice addition to their safety plan but not the core of their investment property protection. After all, real estate assets cost a lot of money, which means that you need to minimize all risks from the get-go and find solutions preemptively.

AirCover won’t help you if any of the following happens to you or your property:

• A hurricane breaks your windows when your rental is not occupied.
• Your property becomes a victim of a riot when there are no renters on site.
• A guest causes expensive damage to your hot tub.
• A renter suffers major bodily injury that incurs medical bills above the $1 million ceiling stipulated by Airbnb.

While these might sound like far-stretched scenarios, experienced owners know that such things happen in the rental business and can put you in a very messy situation. That’s why you need to get extra coverage to operate a shielded business.

Airbnb Host Duties Beyond AirCover

Even with AirCover, Airbnb owners remain responsible for a wide range of items under local rules and regulations across the US market. Many states and cities demand short-term rental licensing or permitting, safety features, liability coverage, and others far beyond the scope of the program.

No matter where you invest in a rental property, it is your responsibility to be aware of local Airbnb rules and follow them strictly to avoid legal problems. For instance, Florida short-term rental regulations might be rigid to protect properties and guests against common natural disasters. New York Airbnb laws have also tightened in recent years.

As a diligent host, you have to know local requirements and get proper protection for what’s left outside the scope of AirCover.

Does AirCover Suffice for Rental Properties?

The $3 million host damage protection appears very generous, but it might not be enough to protect multifamily units or luxury villas. Similarly, $1 million host liability insurance sounds excessive, but the combined cost of legal fees and medical bills can easily exceed this amount.

In other words, AirCover doesn’t guarantee enough coverage as a standalone program. To truly protect your rental business and Airbnb portfolio, you need proper coverage, provided by a third-party insurance policy. Check out our guide on short-term rental insurance to evaluate your options as an Airbnb host.

Conclusion: Protect Your Property Beyond AirCover

AirCover is a great add-on that helps minimize the impact of some risks related to renting out on Airbnb. At the same time, it leaves hosts unprotected during vacancy and natural disasters. Moreover, reimbursements are not guaranteed even under eligible events.

Coverlyn helps Airbnb hosts and landlords bridge the gaps left by AirCover. To give your rentals the protection they deserve, get a quote for  affordable landlord insurance.