Your province

Skip to Content
null Short Term Rental of Your Primary Residence – Are You Protected?

Not only do these sites provide tourists with an affordable and more personal alternative to hotels, they also offer homeowners a chance to increase their income using their primary residence.

How does it work?

Maybe you live in an area that is hosting an event that attracts a lot of visitors. Perhaps you live in a popular tourist destination, near water or the mountains. Maybe you just want to cover your rent or mortgage payments while you’re away on vacation.

Airbnb and VRBO make it very easy for you to become a host on their sites. All you have to do is answer some questions about your space and upload photos of it. You decide how much you’d like guests to pay per night, when your space is available and even whether or not a guest will be allowed to stay in your home. Both sites have excellent FAQ sections that explain how the service works.

The Downside

It seems these short-term rental sites offer excellent opportunities for both hosts and guests…however, as with most things there is always another side of the coin.

The unfortunate recent trashing of a Calgary home is just one example of a short-term rental gone wrong. The home, which was rented out using Airbnb, was trashed by the renters who used a stolen credit card to secure the booking. The home sustained damage assessed at over $75,000, and it was not fit to be occupied until it was cleaned and repaired, which is still underway.

Luckily, Airbnb is covering the costs; however, this incident brings to light just how important it is to ensure that you know all the facts before you rent out your home to people you don’t know.

Also, you must make sure you have the proper insurance coverage to protect you and coverage extensive damages.

Are You Covered?

While these short-term rental sites may offer some protection, coverage is often limited and specific to certain locations. For example, even though Airbnb is covering the costs of the damage caused to the Calgary home, this is an exception. Airbnb’s Host Protection Insurance plan is only applicable to hosts with properties in the U.S. And VRBO does not offer insurance coverage to their hosts. Clearly, homeowners who are renting their homes on these sites need to take responsibility for protecting their properties and the contents themselves.

If you’re planning on renting out your home using one of these short-term rental sites, you should consider getting a vacation rental insurance policy. Why? Renting your home out, even for the short-term, is considered a business activity, and neither your homeowner insurance policy nor your personal liability coverage will cover business activities.

Insurance companies treat owner-occupied homes differently than homes that are rented to third parties. Changes in occupancy can affect your coverage, so it’s important that you speak with your insurance provider before making the decision to rent out your home.

There are many good short-term renters out there who will treat your home as your own, but there are also some bad ones. Protect what you’ve worked hard to achieve by choosing your renters carefully and making sure you have the right insurance coverage.

Short Term Rental of Your Primary Residence – Are You Protected?

It’s no surprise that short-term rental sites like Airbnb and VRBO (Vacation Rental by Owner) have been rising in popularity in recent years.

These tips are provided for information and prevention purposes only. They are general in nature, and Desjardins Insurance cannot be held liable for them. We recommend using caution and consulting an expert for comprehensive, tailored advice.

In Quebec, Desjardins Insurance refers to Desjardins General Insurance Inc. In Ontario and Alberta, Desjardins Insurance refers to Certas Direct Insurance Company, underwriter of automobile and property insurance.

Other related articles: