Hello all,
I'm a travel nurse who is looking at renting out my home while I'm away on assignment. My insurance agency has provided 2 different options for a STR policy, and would like your advice.
Option #1
Residential policy -Premium is about $1925/year, $1000 deductible across the board. This policy comes with the terms that- I can only rent out my home for 6 months out of a year (from start of policy-not calendar year). Also, tenants can only stay 89 days consecutively. This would be of concern if I rent to a traveling professional like myself who typically stays 13 weeks (91 days).
Option #2
Commercial policy-Premium is $1390/year. Deductible is $1000, with the exception of wind/hail. Wind/hail deductible is 2% of the home's value, so deductible could be up to $5800. This policy also has a $4 million aggregate with $2 million per occurrence. Premium is based on gross sales with an annual audit.
I'm leaning towards the commercial policy (option #2) because it is cheaper policy, comes with liability insurance, and tentatively no stipulations on length of stay(currently waiting to hear back from insurance company to confirm this). I do have an additional separate umbrella policy of $4 million. My biggest concern is the 2% deductible, however I do have an emergency fund as well as money in my taxable account that could easily cover the deductible in the event of hail/wind damage. What are your thoughts? Anything else I should consider? Thank you for reading my post.
Short term rental insurance policy
Re: Short term rental insurance policy
Go with the second one. Agree.
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Re: Short term rental insurance policy
If you can afford the $5,800 deductable for wind/hail, get a quote for $5,000 across the board (vs. $1,000). Claims on homeowner's policies are pretty rare, and you don't want to be making trivial claims you can self-insure, which will raise your rates and cost more in premiums.