The Beginner’s Guide to Short-Term Rentals

two traveling friends walk into short term rental apartment

From a stylish urban loft to a cozy country cottage… booking a short-term stay is a hot trend (and a great way to travel like a local.)

Maybe you’ve considered becoming a host yourself. If so, you’ve probably wondered: Is it safe? Can I actually make money doing this? What amenities should I offer my guests?

Good news: You’re asking all the right questions.

Whether you’re looking to rent out your entire home, a guest house or a single bedroom, it pays to do some research first. From vacation rental sites like Airbnb and VRBO® to home-sharing sites like Couchsurfing – even old-fashioned weekly and monthly rentals! – there’s no shortage of options.

Keep reading to find out what great hosts know – and what you should know about your homeowners insurance if you’ll be hosting short-term rental guests.

3 Essential Tips for First-Time Hosts
As a host, a little preparation goes a long way. Before you list your property online, think through these three topics: 

  • Pricing: To determine the rate you’ll charge for your rental, start by doing some research. Use sites like Airbnb and VRBO® to find comparable listings in your area to determine a competitive price point.
  • Marketing: A picture says a thousand words. When developing your listing, be sure to take photos that show your home in a positive light. Then, write a detailed listing description with all the reasons why your home is a great place to stay. Pro tip: Be descriptive, but don’t oversell it. Travelers value honesty and transparency, and exaggerations won’t do you any favors when it comes time for your guests to leave you a review.
  • Hospitality:  Keep your home stocked with convenience items like shampoo and face wash in the bathroom, or pantry staples and a few fresh groceries in the kitchen. Make sure your space is free of clutter and give your guests a place where they can relax and feel at home.

How does insurance work for short-term rentals?
This can get tricky. Let’s explain.

Your listing site’s insurance
If you want to host short-term rental guests, do your research on what your online listing site does (and doesn’t) cover. For example, not every listing site offers liability coverage for hosts. Make time to talk to an insurance professional like an Erie Insurance agent to understand how you can customize your own insurance policy to bridge the gap.

Your own insurance policy
Here’s the good news: With ERIE, you have options to customize your existing coverage for home sharing – depending on what you’re renting, and for how long. 

  • To rent out your primary home: If you want to rent out your own residence –whether it’s your whole home or just a spare bedroom – ask about adding the new home sharing endorsement* to your ErieSecure homeowners policy. (More detail on that below.)
  • To rent out a rental property: If you own a property exclusively used for renters or tenants (like an apartment building or cottage), an ErieSecure Rental or Ultrapack Plus policy has built-in coverage for home sharing. You’re covered to host short-term tenants, as long your place is listed on a reputable website that offers liability coverage equal to $1,000,000 or greater for bodily injury to or property damages of guests.  

Why should I add the home sharing endorsement to my homeowners insurance?
The new home sharing endorsement* from Erie Insurance is designed with short-term rentals in mind. You’ll want to consider it if you’re opening up your primary residence (your own home) to short-term tenants for fewer than 180 consecutive days per year.

This endorsement offers additional protection that would apply if something were to happen to a renter or their belongings while renting all or part of your home – for example, if a burst pipe in your home causes water damage to a traveler’s expensive DSLR camera, or your renter is injured by falling down a flight of stairs.

Here’s a little more about how it works: 

  • Extra protection: Coverage is provided up to the liability limit for certain coverages on your homeowners policy, which typically ranges from $100,000 to $1 million.
  • Right-sized for any rental: The coverage kicks in whether you’re renting out your whole home or just a spare room.
  • Affordable: The average cost to add this to your ERIE policy is $40 to $60 per year. (Because coverage, limits and costs can vary, check with an ERIE agent for details.)
  • A company you trust: Customers have been putting their faith in ERIE to protect what matters most to them since 1925. (Find out more about what makes ERIE different.)

Request a Quote
For many people, their home is their most valuable asset. Our job is to help them protect it. If you’re ready to be a superhost, request a quote from an Erie Insurance agent to find the best insurance options for you.

*Not available in Virginia or North Carolina

From must-know hosting tips to home sharing insurance, we’ve got you covered. /blog/short-term-rental-insurance Erie Insurance