By Ryan Drew | Superhost and Vacation Rental Expert | Last Updated August 14, 2026
Guest damage is one of the risks every vacation-rental owner thinks about. A broken chair or stained rug is annoying. A guest-caused fire, major water loss, theft, vandalism, or six-figure party damage is a completely different problem.
The confusing part is that vacation rental damage insurance, platform protection, security deposits, damage waivers, homeowners insurance, landlord insurance, and full short-term-rental insurance are not the same thing. Before choosing a policy, you need to know which risk you’re actually trying to insure.
Our Pick for Full-Time Airbnb & Vrbo Owners: Proper Insurance
For a serious short-term rental, Proper is my preferred option because guest damage is only one part of the risk. Proper’s STR policy combines replacement-cost property coverage, guest-caused damage protection, Commercial General Liability, and business-revenue coverage.
The key guest-damage feature: Proper currently says its Property Entrustment coverage addresses accidental, intentional, and malicious guest damage plus theft and vandalism, without a separate guest-damage sublimit. Coverage remains subject to the building/contents limits and terms of the issued policy.
Check your Proper Insurance quote →
For hosts, not travelers: Search results for “vacation rental damage insurance” are mixed. Some policies are sold to guests to cover accidental damage they cause during a trip. This guide is specifically for Airbnb, Vrbo, and vacation-rental owners/property managers deciding how to protect the rental property and business from guest-caused damage.
Best Vacation Rental Damage Insurance: Quick Comparison
| Option | Product Type | Accidental Damage | Intentional / Malicious Damage | Theft | Platform Dependent? | Full Property Policy? |
|---|---|---|---|---|---|---|
| Proper Insurance | Dedicated STR insurance | Yes, subject to policy | Proper says yes under Property Entrustment, subject to policy | Proper says yes, subject to policy | No — property-level policy | Yes |
| CBIZ Vacation Rental Insurance | Dedicated vacation-rental insurance | Yes, subject to policy | Current materials address guest-caused / dishonest or criminal acts; verify form | Verify quoted form and limits | No — property-level program | Yes |
| Safely | Per-stay / protection insurance program | Yes | Current program says most intentional and accidental guest-caused damage | Current materials include theft | No single OTA required, depending on integration/program | No — not a replacement for underlying building insurance |
| Airbnb AirCover | Platform host protection + liability insurance | Eligible Airbnb guest-caused damage | Subject to Host Damage Protection terms | Subject to program terms | Yes — Airbnb bookings | No |
| Vrbo / guest damage plan | Booking/trip damage protection | Typically accidental damage up to plan cap | Often excluded | Often excluded | Usually yes | No |
| Damage waiver | Nonrefundable guest fee / contractual protection | Usually minor accidental damage | Often excluded | Often excluded | No, if operated independently | No |
Insurance availability, limits, exclusions, deductibles, and underwriting vary by state and property. Always compare the actual quote and policy form.
What Is Vacation Rental Damage Insurance?
The phrase “vacation rental damage insurance” gets used for several different products. For an owner, the most important distinction is between protection for one guest stay and insurance on the property and rental business itself.
- Full STR insurance: A property-level policy designed to insure the building, contents, liability, and rental-income exposure of operating a short-term rental.
- Home-sharing endorsement: Additional coverage attached to an eligible homeowners policy. Availability and scope vary significantly.
- Platform protection: Programs such as Airbnb’s AirCover that provide certain protections connected to eligible bookings. They are not a substitute for reviewing the property’s underlying insurance.
- Damage waiver or protection plan: A separate product aimed primarily at guest-caused accidental damage, usually with its own limits, exclusions, and claim window.
- Security deposit: Money held or authorized against a guest. It can help with smaller losses but is not property or liability insurance.
For a dedicated vacation rental, I care most about the first category. A $2,000 or $5,000 guest-damage plan does not solve the same problem as a policy protecting a six-figure building, its contents, commercial liability, and the income the property generates.
Does Homeowners Insurance Cover Airbnb Guest Damage?
Do not assume your homeowners policy automatically stops covering the entire property the instant you rent it for one night. The old version of this article made that claim too broadly. What actually happens depends on your insurer, policy form, endorsements, frequency of rental activity, and the loss involved.
The important issue is that standard homeowners insurance was written for residential use, not necessarily a revolving stream of paying guests. Some insurers offer home-sharing endorsements for occasional rentals; others require a landlord, dwelling, or commercial solution. Tell your insurer exactly how the property is being used and get confirmation of the coverage in writing.
For a property operated primarily as an Airbnb or Vrbo business, I prefer a policy that explicitly contemplates short-term rental use rather than hoping a conventional policy responds the way I expect after a major guest-related loss.
What Coverage Should a Serious STR Owner Look For?
- Guest-caused damage: Ask whether accidental, intentional, and malicious damage are covered and whether there is a separate sublimit.
- Theft and vandalism: Confirm how losses involving a paying guest are treated.
- Replacement cost: Determine whether damaged building components and contents are settled at replacement cost or depreciated value.
- Commercial liability: A guest injury can dwarf the cost of replacing damaged furniture.
- Business-income protection: If covered damage shuts the property down for months, lost bookings can become one of the largest parts of the loss.
- Amenity liability: Pools, hot tubs, bicycles, kayaks, docks, golf carts and other guest amenities deserve specific attention.
- Occupancy flexibility: Confirm coverage during guest stays, personal use, and vacancy if your property cycles among those uses.
- Water, sewer/drain backup and catastrophe deductibles: A policy’s headline coverage means little if the loss you experience falls under an exclusion or large separate deductible.
1. Proper Insurance — Best Overall for Dedicated Short-Term Rentals
Proper Insurance is my first quote for a serious Airbnb or Vrbo because its policy is designed specifically around short-term-rental risk rather than treating guest damage as an isolated add-on.
Proper currently describes its policy as a Commercial Homeowners policy that replaces a conventional homeowners or landlord policy. It combines replacement-cost coverage for the building and contents with Commercial General Liability and business-revenue protection.
Why Proper Stands Out for Guest Damage
Proper’s Property Entrustment protection is particularly relevant to this article. Proper currently states that it covers accidental, intentional, and malicious damage caused by guests, along with theft and vandalism. It also says there is no separate guest-damage cap; a covered loss is instead subject to the applicable building or contents limits in the policy.
That distinction matters. A platform guarantee or standalone damage plan might have a separate maximum payout. With a major covered guest loss, I would rather have the loss evaluated under the property’s actual insured limits than discover that the “guest damage” feature has a relatively small sublimit.
Proper Also Protects the Income Behind the Property
If guest-caused damage makes the property uninhabitable after a covered loss, Proper’s current program provides business-revenue protection on an actual-loss-sustained basis up to the limit selected. That is one reason I view damage insurance as more than reimbursement for broken physical items.
Proper also currently includes $1 million of Commercial General Liability as standard, with higher limits available, and extends liability protection to many common guest amenities.
For the full company analysis, read our Proper Insurance Review. You can also see how it compares directly in Proper Insurance vs. CBIZ and Foremost vs. Proper Insurance.
2. CBIZ Vacation Rental Insurance — Strongest Direct Alternative
CBIZ deserves to be treated as a serious STR specialist. Its current Vacation Rental Insurance program includes replacement-cost protection for building and contents, business/rental-income protection, Commercial General Liability, and damage caused by guests—including dishonest or criminal acts—subject to the policy terms.
CBIZ’s current program also advertises $1 million per occurrence / $2 million annual aggregate liability limits and coverage features aimed at vacation-rental exposures such as pools, hot tubs, docks and outbuildings.
I have personally obtained quotes from both Proper and CBIZ. My historical Proper quote was $1,600 per year with a $1,000 deductible, while CBIZ quoted $1,686 per year with a $1,000 deductible. Those are not 2026 market averages—they are simply useful firsthand evidence that the two can price surprisingly close.
At only an $86 difference in my case, I preferred Proper. If CBIZ comes in materially cheaper for your property, however, compare the actual guest-damage limits, deductibles, liability, income protection and exclusions before deciding.
3. Safely — Strong Per-Stay Guest Damage Protection
Safely deserves a separate mention because it sits between a simple damage waiver and a full annual STR property policy. Its current protection program is designed around eligible guest stays and says it can cover most intentional and accidental guest-caused damage to the insured property and contents. Current Safely materials also discuss theft, pet damage, and homeowner/property-manager liability, depending on the program.
That makes Safely particularly relevant to property managers who want per-stay damage protection across a portfolio. But I still would not treat it as a substitute for the underlying insurance on the building itself. The right comparison is often Proper/CBIZ for the property-level insurance foundation + a per-stay damage strategy where it adds value, not one or the other.
4. Foremost — Best for Customizable Landlord Coverage
Foremost’s current landlord program explicitly accepts vacation and short-term rental properties. Foremost defines these within its program as properties rented under agreements of less than 12 months, and it says a vacation home that is sometimes owner-used and sometimes rented short-term can qualify.
That corrects two outdated claims in the previous version of this article: Foremost is not categorically limited to non-owner-occupied rentals, and it should not be dismissed as incapable of covering STRs.
Foremost’s strength is customization. Depending on the policy and state, owners can choose named-peril or broader property coverage and add options such as loss of rents, replacement cost, extended replacement cost, equipment breakdown and service-line coverage.
For guest damage specifically, I would ask the Foremost agent to identify the exact provisions in the quoted policy that respond to accidental, intentional, or malicious damage by a short-term paying guest. For a dedicated STR, I still prefer the clarity of starting with a purpose-built STR policy.
What About Airbnb AirCover?
AirCover is useful, but don’t confuse it with the underlying insurance policy on your property. Airbnb’s Host damage protection can reimburse hosts for certain guest-caused damage connected to eligible Airbnb stays, while AirCover also includes a separate Host liability insurance component.
The key limitation is structural: platform protection is tied to the platform and its program terms. It does not replace the need to determine whether your actual home or rental-property insurance permits and covers your STR activity. It also does nothing for a Vrbo or direct booking simply because you happen to list the property on Airbnb.
I treat platform protection as an additional layer—not the foundation of an STR insurance strategy.
What About Vrbo Accidental Damage Protection?
Vrbo-related damage protection is another reason this keyword is confusing. Guest-paid accidental-damage products are generally designed to cover accidental damage during a specific reservation up to a stated cap. They can be useful, but they solve a narrower problem than a dedicated STR property policy.
For an owner, I would check whether the guest has to opt in, the maximum benefit, the claim/reporting deadline, and whether intentional damage, theft, pets, or unreported damage are excluded. Most importantly, a booking-specific damage plan should not be mistaken for year-round building, contents, commercial-liability, and business-income insurance.
Damage Waivers vs. Vacation Rental Insurance
Damage waivers can be useful, especially for smaller accidental losses. Depending on the provider, an owner or property manager may charge a guest a nonrefundable fee in exchange for waiving the guest’s responsibility for covered accidental damage up to a specified amount.
But a damage waiver should not be compared directly with a full STR policy. Waivers and protection plans can differ dramatically in coverage caps, exclusions, claim deadlines, intentional-damage treatment, theft, pet damage and whether the product is actually insurance. They also do not necessarily solve your building, catastrophic property, commercial-liability, or lost-business-income exposure.
For many professional hosts, the answer isn’t insurance or a damage waiver. It can be a real STR insurance policy as the foundation, with platform protection, deposits, or a damage program layered on top where useful.
Coverage Caps, Claim Windows & Evidence: Where Damage Plans Differ Most
This is one of the biggest themes in the current SERP, and it is where damage waivers and booking-platform protection can look very different from a full STR insurance policy. Published damage-protection programs can range from relatively small accidental-damage caps to much larger limits, and claim/reporting windows vary substantially by provider.
When comparing a damage product, I would write down these five numbers before looking at the price:
- Maximum payout / coverage cap: Is the limit $1,000, $3,000, $5,000, $50,000, or tied to the insured building/contents limit?
- Deductible: What comes out of your pocket before the product responds?
- Reporting window: How many days after checkout do you have to discover and report the damage?
- Evidence requirement: Are photos enough, or do you need invoices, repair estimates, guest communication, police reports, or proof the guest refused payment?
- Settlement basis: Does the program reimburse depreciated value, repair cost, replacement cost, or another defined amount?
The reason this matters is simple: a $5,000 protection plan with a short claim window can be perfectly useful for a broken sofa and almost irrelevant after a major party causes $75,000 in damage. For large losses, I want to know what the property’s underlying insurance does.
Accidental vs. Intentional Damage, Theft & Pet Damage
Current damage-protection comparisons increasingly separate these categories because many products cover one and exclude another. “Guest damage covered” is not specific enough.
- Accidental damage: The broadest common category—broken furniture, spills, accidental water damage, and similar incidents.
- Intentional or malicious damage: Often excluded by basic waivers and travel-style damage plans. Proper specifically advertises intentional and malicious guest damage under its Property Entrustment coverage; Safely also says its protection program covers most intentional and accidental guest-caused damage.
- Theft: Frequently treated differently from physical damage. Ask whether theft by a guest is included and whether a police report is required.
- Pet damage: Do not assume “guest damage” includes a guest’s animal. Some programs cover it; others expressly exclude it.
- Wear and tear / cosmetic damage: Usually excluded. A protection product is not a maintenance budget.
How Much Does Vacation Rental Damage Insurance Cost?
There is no credible national price I would use to budget full short-term-rental insurance. Premiums depend on the property’s location, replacement cost, revenue, occupancy/use, amenities, claims history, catastrophe exposure, selected limits and deductibles.
The old version of this article said continuous coverage generally costs “$1,500+ annually” and on-demand protection can cost only a few dollars per night. Those figures are too broad to be useful today because they mix fundamentally different products.
My own historical comparison provides a better illustration: Proper quoted $1,600 annually and CBIZ $1,686, each with a $1,000 deductible. Another property can be dramatically higher or lower. Get property-specific quotes and compare coverage before comparing price.
How to Compare Guest-Damage Coverage
When getting quotes, don’t ask only, “Do you cover guest damage?” Ask the agent to walk through a realistic loss. For example: A paying guest leaves water running, causing $80,000 in building and contents damage and forcing me to cancel $25,000 of future bookings. What exactly pays, what deductible applies, and what is excluded?
Then ask the same question about intentional damage, theft by a guest, vandalism, pet damage, a guest injury, and damage involving an amenity. The differences become much easier to see when you’re comparing the response to an actual scenario instead of marketing labels.
The 8 Questions I Would Ask Before Buying
- Does the policy explicitly permit short-term paying guests?
- Is accidental guest-caused damage covered?
- What about intentional or malicious guest damage?
- Is theft by a guest covered?
- Is there a separate guest-damage sublimit?
- What deductible applies?
- If covered damage cancels future bookings, how is lost revenue calculated?
- Does liability extend to every amenity I provide guests?
Is Vacation Rental Damage Insurance Worth It?
For a dedicated STR, protecting against guest damage is absolutely worth considering—but I would not stop at a narrow guest-damage product. Your largest exposures may be the building itself, a serious liability claim, or months of lost rental revenue after a covered loss.
For an occasional host renting a primary residence a handful of times per year, a full commercial-style STR policy may be more coverage than necessary. Start with your current insurer and ask whether an appropriate home-sharing endorsement exists. For a full-time investment property, however, I would compare dedicated STR policies.
Vacation Rental Damage Insurance FAQs
What is the best insurance for Airbnb guest damage?
Proper is my preferred full-policy option for a dedicated Airbnb or vacation rental. Its current Property Entrustment coverage specifically addresses accidental, intentional, and malicious guest damage, theft and vandalism without a separate guest-damage sublimit, subject to the policy’s building/contents limits and terms. CBIZ is also a strong STR-specific alternative.
Does Airbnb pay for damage caused by guests?
Airbnb’s AirCover for Hosts includes Host damage protection for certain eligible losses caused by guests during Airbnb bookings. That program is not a replacement for determining whether your underlying property insurance covers short-term rental activity.
Does vacation rental insurance cover intentional guest damage?
It depends on the policy. Proper currently states that its Property Entrustment coverage includes accidental, intentional and malicious guest-caused damage. Never assume another policy does the same—ask specifically about intentional damage, vandalism and theft by a paying guest.
Do I need vacation rental insurance if I have Vrbo or Airbnb protection?
I would still maintain underlying insurance that explicitly permits the property’s STR use. Platform protection is tied to platform terms and eligible bookings; it should not be treated as the sole insurance strategy for the building and rental business.
Does vacation rental insurance cover lost bookings after guest damage?
Some dedicated STR policies do. Proper currently provides actual-loss-sustained business-revenue protection for covered losses up to the selected limit. CBIZ also offers business/rental-income protection. Compare the trigger, limits and policy wording carefully.
Is a vacation rental damage waiver the same as insurance?
No. A damage waiver is generally a nonrefundable fee or contractual arrangement covering specified accidental damage up to a stated cap. Some damage-protection products are insurance, while others are not. Read the terms and identify the actual insurer, if any.
What is the difference between guest damage protection and STR property insurance?
Guest damage protection focuses on damage connected to a guest stay. A dedicated STR property policy can also protect the building, contents, commercial liability, business income, and other exposures unrelated to a single reservation.
Should I use a security deposit or a damage waiver?
They solve the same small-damage problem differently. A security deposit is refundable but can create guest friction; a damage waiver is usually a smaller nonrefundable fee. Neither automatically replaces underlying STR insurance for large property, liability, or income losses.
Final Verdict: Best Vacation Rental Damage Insurance
The biggest mistake is assuming every result for “vacation rental damage insurance” solves the same problem. Some products protect a traveler from accidental damage charges, some protect a host for one reservation, and some insure the property and STR business itself. A serious vacation rental needs protection for the entire financial exposure created by paying guests—not only a broken television or damaged sofa.
CBIZ is a strong specialist. Foremost offers legitimate customizable short-term-rental landlord coverage. Airbnb’s AirCover and standalone damage programs can provide useful additional layers.
But for a dedicated Airbnb, Vrbo, or vacation-rental business, Proper remains my first choice. Its combination of replacement-cost property coverage, guest-caused damage protection without a separate guest-damage sublimit, Commercial General Liability, amenity protection, and business-revenue coverage addresses far more than the small damage incidents hosts tend to worry about first.
Continue your research with our Best Airbnb & Short-Term Rental Insurance guide, our Short-Term Rental Insurance Companies directory, or the full Proper Insurance Review.
