Many owners start tourist rental without adapting their insurance. The property was already insured, so that seems fine. Until something goes wrong. A guest leaves the hob on, a pipe bursts during a stay or a child falls down the stairs. That is when it becomes clear whether your policy takes letting to guests into account.
This article gives an overview of the points that matter. It does not replace advice from your broker or insurer. Every policy is different. Use the questions at the end of this article as a guide for a conversation.
Why your ordinary home insurance is often not enough
A standard home insurance policy assumes a house that you live in yourself, or that you rent to one long-term tenant. Tourist rental is something else. New people come through the door every time. They do not know the house. The property sometimes stands empty for days between two stays.
For an insurer, that means a different risk. That is why a standard policy often does not cover tourist rental, or only partly. Sometimes this is stated explicitly in the terms. Sometimes it follows from the obligation to report any change in the risk. If you do not, you run the risk that the insurer pays out less, or nothing, in the event of damage.
In Flanders, liability insurance towards your guests is also one of the conditions for tourist rental. That cover is therefore not an optional extra.
What to tell your insurer
Be complete in what you pass on. An insurer can only propose the right cover if they know how the property is used. Provide at least this information:
- that you let the property to tourists, and through which channels;
- roughly how often, and whether you also stay there yourself;
- the maximum number of guests;
- whether you let as a private individual or through a company;
- whether a third party handles the management, cleaning or keys;
- which safety measures are in place, such as smoke detectors, a fire extinguisher and a fire safety certificate.
Then ask for written confirmation that the policy covers tourist rental. A verbal "that's fine" is worth little when you have a claim.
Liability towards guests
Civil liability insurance covers damage that you as owner cause to others. Think of a guest who is injured by a loose banister or a faulty appliance. In tourist rental, that cover is the core of your protection.
Ask which amounts are insured and whether both personal injury and property damage suffered by guests are covered. Also ask whether the cover applies to the garden, the swimming pool or other facilities that guests use. A swimming pool or hot tub is often a separate point of attention.
Fire and waiver of recourse
In the event of fire or water damage, your fire insurance pays for the damage to the building. The question then is who the insurer can pursue. If a guest caused the fire, your insurer can in principle take recourse against that guest.
Many owners want to avoid that. A dispute with a guest after a fire is not a pleasant situation. Some policies therefore include a waiver of recourse in favour of tenants or users. Ask explicitly whether that waiver also applies to short-stay guests. Also ask whether there are exceptions, for example in the case of intent or gross negligence.
Contents and damage by guests
A holiday home is often fully furnished. Furniture, beds, electrical appliances, kitchen equipment and linen together represent considerable value. Have those contents valued realistically, so that you are not underinsured if there is damage.
Damage by guests is a separate matter. A broken glass or a stain on the sofa usually counts as ordinary wear and tear and is not reimbursed. Larger damage caused by an accident may be covered. Deliberate damage or theft by guests is often excluded or limited. Ask exactly where the line is drawn.
Record the condition of the property with photos after every stay. Without evidence of the condition before and after a stay, it is difficult to link damage to a specific guest.
Loss of income
After a fire or serious water damage, your property can sometimes not be let for weeks. Bookings are cancelled and no new ones come in. For anyone who sees the rental as a source of income, that weighs heavily.
Some policies offer cover for loss of rental income or business interruption. Ask how it is calculated, how long it runs and which supporting documents are needed. An overview of your bookings and income per month helps to back up a claim.
Platform programmes do not replace your insurance
Booking platforms such as Airbnb offer hosts their own programmes for damage by guests. They can be useful as a supplement. They are not a replacement for your own insurance.
The terms, limits and exclusions of such programmes vary and can change. Strict deadlines often apply for reporting damage and providing evidence. What is more, they only apply to bookings through that one platform. If you let through several channels or also directly, you need your own policy that covers all stays in any case.
Questions for your broker
Take this list to your next conversation:
- Does my policy cover tourist rental, and can I have that in writing?
- Is my civil liability towards guests covered, and for what amounts?
- Does the waiver of recourse also apply to short-stay guests?
- Are my contents valued correctly, including linen and appliances?
- Which damage by guests is covered, and what counts as wear and tear?
- Is theft by guests covered?
- Is there cover for loss of rental income after a claim?
- Do extra conditions apply for a swimming pool, hot tub or wood burner?
- What do I need to do if I let through a company or outsource the management?
- Which deadlines and supporting documents apply when reporting damage?
After that, review your policy again every year. New furnishings, a renovation or more rental nights can change the cover.
A well-managed property helps too
Insurance absorbs damage, but prevention is still better. At YourDomi, our own cleaning team works with a fixed checklist and a photo check after every stay, and regular tradespeople deal with maintenance quickly. That way, if there is damage, you have a clear file straight away. If you are curious what that means for your property, request a personal proposal.
