Why Is My Insurance More with a Short-Term Rental?

My basement suite flooded, and the bill to fix it was $3,600. Here's the part that surprised people: I paid that $3,600, I didn't have to pay a deductible, and my insurance didn't go up even though I made a claim. My short-term rental coverage — my Air coverage — covered it.

That's how it's supposed to work. You carry the extra coverage on the rental side of the property, and when something goes wrong in the suite, that coverage is what responds. The flood got fixed, the claim got handled, and it didn't touch my premiums.

So you'd think carrying that extra insurance would earn you something on the other side of the policy. You'd think your primary residence insurance would cost less — you're a better, more covered customer, after all. It doesn't. My home insurance is still more with a short-term rental in the picture, and the extra coverage I carry doesn't bring the primary side down at all.

That's the reality of insuring a property with a short-term rental in it: the rental raises your costs on one side, and the coverage that protects you so well on the rental side buys you no discount on the other. Budget for it that way — as a cost of doing Airbnb — and be glad the coverage is there when a suite floods, because when it responds, it responds properly.

Key takeaways

  • When my basement suite flooded, the fix cost $3,600 — and my Air coverage covered it.
  • I paid no deductible, and my insurance didn't go up for making the claim.
  • Carrying that extra rental coverage does not make your primary residence insurance cheaper.
  • Short-term rental insurance costs more on the home side; that's a built-in cost of running an Airbnb.

Watch the original Short: https://www.youtube.com/shorts/OczF1FfgINg

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