Why You Need Insurance Even With Strict Guest Screening

As a diligent short-term rental property manager, it’s likely that you go above and beyond to screen the guests who rent your homes. That level of thoroughness is a great quality to have, but it may lead you to believe that you don’t need extra insurance.

That’s a common myth that far too many short-term rental property managers fall victim to. And if you follow suit, you might find yourself facing tens of thousands in uncovered repairs or, worse, a civil liability claim.

Despite your best efforts, unforeseen events can occur that may jeopardize your investment. But the good news is that it’s not too late to protect yourself and your portfolio of properties. Join us below as we dive into the various reasons why you need short-term rental insurance, even with strict guest screening. 

The Limits of Guest Screening

Guest screening is a great tool, and it’s something that we recommend to short-term rental managers. Be that as it may, there’s no such thing as a one-size-fits-all solution. Just as a toolbox needs various pieces of equipment, every short-term rental manager needs to implement multiple layers of protection for their properties. 

With that in mind, here are a few reasons why guest screening might not protect you from insurance claims: 

People Can Surprise You

A guest can look great on paper, have stellar reviews from your favorite short-term rental site, and be a “safe” renter for all intents and purposes. However, that doesn’t fully guarantee that they won’t damage your property or suffer an accident during their stay. We, as humans, are simply unpredictable. 

Your “safe” guest might decide to unwind on vacation with one too many alcoholic beverages and then decide to fire up the grill. And before you know it, your short-term rental property that typically generates exceptional revenue is uninhabitable for months due to significant fire damage. You’ll be out thousands of dollars in rental revenue and required to foot the bill for the damage because you don’t have the right vacation rental insurance policy. 

Accidents Happen

Even if your guests behave responsibly during their stay, nothing can guarantee that they won’t slip and fall on a wet pool deck during the dog days of summer or stumble on an icy sidewalk in the dead of winter. As a short-term rental property manager, you need to safeguard yourself and your portfolio against the otherwise unexpected. 

If someone gets hurt on your property, they’ll expect you to cover their medical bills. And depending on the circumstances surrounding the incident, they may also file a lawsuit for damages. Without the right protections, you could be facing tens of thousands of dollars in attorneys’ fees, medical bills, and court-ordered fines. And your once-profitable rental property will become a huge liability that craters your portfolio. 

Some People Lie

Not all guest screening solutions are created equal. Many, in fact, have blind spots and weak points that unscrupulous guests can exploit. For your screening to work effectively, people have to tell the truth.

Of course, if someone decides to be sneaky in their deceit, they might make it past your screen protocols and secure a stay at one of your rental properties. And if that person happens to have a history of risky behavior or is prone to damaging properties, you’ll be left to face the consequences. 

The bottom line is that you need vacation rental coverage for your short-term rental properties. You don’t want to stop screening guests altogether, of course, but understand that you cannot rely on screening as your only layer of protection. The best course of action is to use a reputable screening tool and have insurance as another tool for protecting your properties. 

What Short-Term Rental Insurance Protects Against

Short-term rental insurance policies can provide protection against a wide range of risks, including the following: 

Accidental Damage

While some damage can be an easy fix, other incidents, even if they’re accidental, can leave you facing thousands of repair bills. Fires, floods, and misuse of equipment, for instance, pose constant risks to your properties. 

Let’s say that a guest accidentally closes the return valve on your pool pump and causes it to burn out. You might have to spend thousands of dollars getting a new system installed, but a short-term rental insurance policy will protect against such an incident, keeping you from incurring major repair costs. 

Vandalism and Intentional Acts

If your home is targeted by intentional acts of guests or passersby, short-term rental coverage can offer protection. Not all vacation rental policies provide this type of protection, though. so it’s important to thoroughly review policy terms and conditions to ensure your plan doesn’t have any gaps.

Accidents and Liability Claims

Vacation rental insurance policies also offer protection against guest injuries and the liability claims that come with them. If one of your renters gets hurt and sues you for their medical expenses, your policy can cover the bill. Some policies also provide money to cover legal fees and any damages that you are ordered to pay. But again, it’s important to thoroughly review your policy details so you know your limits and protections. 

Safely Can Help Protect Your Investments

Safely provides robust guest screening solutions that are more thorough than your average background check tools. We also offer customizable short-term rental insurance coverage for managers who oversee ten or more properties. Connect with one of our vacation rental insurance specialists today to request a quote.