Airbnb Insurance: How to Protect your Holiday Home, Your Guests and Your Income

If you host on Airbnb in the UK, insurance is one of those topics that feels complicated until you break it down. But the good news is… it doesn’t have to be. 

This guide walks you through every type of cover a short let host should consider, what Airbnb's own protections actually do (and don't do), and how to avoid the gaps that catch hosts out.

Quick answer: What Insurance Do I Need for Airbnb?

If you let a holiday home or even a spare room to paying guests through Airbnb, you almost certainly need specialist holiday home insurance. A standard home insurance policy is designed for owner-occupied residences and typically excludes business use, short term rentals and hosting guests for payment.

Airbnb's own AirCover programme offers a baseline safety net, but it is not a full replacement for a dedicated holiday home insurance policy or proper host insurance. It cannot provide buildings cover, protect your rental income during void periods, or satisfy a mortgage lender's requirements.

Here are the core covers most Airbnb hosts should consider:

• Specialist holiday home insurance (buildings cover for your property's structure)
• Holiday home contents insurance (furniture, appliances, guest-use items)
• Public liability insurance for airbnb guests and visitors
• Accidental damage cover and malicious damage protection from guests
• Loss of rental income if the property becomes uninhabitable after an insured event
• Home emergency cover (burst pipes, boiler breakdowns, locksmith callouts)

From Pass the Keys' perspective, hosts should always speak to their own insurer or a specialist broker before listing. Never assume your existing home insurance cover extends to paying guests or short-let activity. The sections below explain what holiday home insurance cover includes, what it doesn't, and how holiday home insurance cost is calculated.

Matthew Durrant, Managing Director at i4me, said:

"One of the most common misconceptions we come across is that a standard home insurance policy will cover short term letting. In many cases it will not. Once you start welcoming paying guests, the risks change, so it is important to tell your insurer or speak to a specialist before accepting bookings. It is far better to have that conversation before you need to make a claim."

Airbnb's Own Protection vs Proper Holiday Home Insurance

Airbnb's AirCover for hosts and an external holiday home insurance policy serve different purposes. AirCover is a platform-administered protection programme included with every Airbnb stay. A holiday home insurance policy is a regulated insurance contract you arrange separately, covering a much broader set of risks.

AirCover includes Host Damage Protection (up to USD 3 million for guest-caused damage) and Host Liability Insurance (up to USD 1 million if a guest is injured or their personal property is harmed). In the UK, the liability element is underwritten by regulated insurers such as Zurich, arranged through Airbnb UK Services Ltd as an appointed representative of Aon UK, which is authorised by the Financial Conduct Authority.

However, there are important limits:

• AirCover does not cover buildings insurance, loss of income, or damage from wear and tear and gradual deterioration
• The damage protection element is a guarantee programme, not a regulated insurance policy - hosts may not have access to the Financial Ombudsman for disputes
• Claims are handled through Airbnb's platform, not directly with an insurer, which can mean different timescales and evidence requirements
• Mortgage lenders and local authorities may still require a specific landlord insurance or holiday home insurance policy regardless of AirCover

AirCover can work alongside your own insurance protection, but it cannot replace it. The following sections break down what dedicated holiday home insurance usually includes.

Matthew Durrant added:

"We are often asked whether hosts can simply buy 'top up' insurance to sit alongside AirCover. While some insurers may offer products that complement platform protections, most holiday let owners are better served by a comprehensive specialist policy. AirCover and an insurance policy work very differently, so trying to fill the gaps can leave uncertainty over what is and is not covered if something goes wrong."

What is Holiday Home Insurance for Hosts?

Holiday home insurance is a specialised type of home insurance designed for properties that are not the owner's main residence and are regularly used for short-term lets or holiday stays. It accounts for the specific risks of a holiday property: frequent guest turnover, extended periods left unoccupied, and the wear that comes with commercial use.

This type of insurance cover can apply to a full second property, a rural cottage, a coastal lodge, an annexe, or even a frequently-let spare room. Standard home insurance is often invalid if the property is rented out to airbnb guests or left unoccupied for long periods without disclosure to the insurer.

A typical holiday home insurance policy protects both the building and contents against insured events such as fire, storm, flood, escape of water, theft and vandalism. Some policies are designed specifically for furnished holiday lettings in the UK, while overseas holiday home insurance is available for properties in countries such as Spain, France or Portugal - though local laws and rebuild costs will differ.

At Pass the Keys, many of the homes we manage need this more specialist cover because they sit empty between bookings and see high guest turnover. Understanding what a policy includes - and what it excludes - is the first step to proper financial protection.

Buildings, Contents and Key Covers you Should Look For

Think of this section as your checklist when speaking to holiday home insurance specialists or brokers. These are the covers to ask about.

Buildings insurance protects the physical structure of your holiday home: walls, roof, chimneys, permanent fixtures like fitted kitchens, bathrooms and built-in wardrobes. It is based on the rebuild cost - the amount needed to completely rebuild the property from scratch - not its market value. This matters for older or listed buildings where the rebuild cost can be surprisingly high.

Holiday home contents insurance covers removable items kept in the property for guests' use: furniture, TVs, white goods, soft furnishings, linens, utensils and personal belongings you leave at the property. Ensure the sum insured reflects replacement cost and that contents cover includes damage caused by guests, not just standard perils. Some policies exclude valuable items above a certain value unless separately listed.

Public liability insurance provides public liability cover if a guest or visitor is injured, or their personal property is damaged, while on your premises. Typical limits for UK holiday let policies range from £2 million to £5 million. If your property has facilities like hot tubs or swimming pools, your liability exposure - and the cover you need - increases significantly.

Accidental and malicious damage by guests is an optional cover that sits outside standard cover for fire or flood. It protects against careless or deliberate damage during a stay, and is particularly relevant for any active Airbnb host.

Additional covers worth considering:

• Legal expenses cover for legal costs if a claim is pursued against you or you need to pursue one yourself
• Home emergency cover for urgent situations like boiler breakdowns, burst pipes, electrical failure or lost keys
• Cover loss of rental income (sometimes called lost income protection) if the holiday home becomes uninhabitable after an insured event - vital for hosts who depend on Airbnb revenue
• Alternative accommodation cover if you or your guests need to be rehoused during repairs
• Extensions for outdoor features such as hot tubs, swimming pools, terraces, outbuildings, and even solar panels or other permanent fixtures

For a deeper dive into each cover type, see our guide to holiday let insurance.

What Holiday Home Insurance Usually Doesn't Cover

Exclusions vary depending on insurer and policy wording, but understanding what a holiday home insurance policy typically won't cover incidents for is just as important as knowing what it will.

Common exclusions include:

• Wear and tear and gradual deterioration - damp, erosion, fading and damage from poor maintenance or faulty workmanship are almost universally excluded
• Theft or malicious damage by paying guests - many policies only cover non-resident theft (burglary) unless you add a specific guest-damage extension
• Unoccupancy limits - if your holiday home is left unoccupied for more than 30, 60 or 90 consecutive days, cover may be reduced or void unless you arrange special unoccupied property insurance. Check your policy for the exact threshold
• Business activities beyond holiday letting - running events, parties or operating as a full B&B with served meals and staff may require different, commercial-grade insurance
• Pre-existing damage - anything present before the policy start date or known and not disclosed
• Overseas-specific risks - for overseas holiday home insurance, location-specific exclusions like earthquake, wildfire or terrorism risk will apply. Always read the policy wording for the country where the holiday property is located

From Pass the Keys' experience, the most common reason claims are refused is non-disclosure. Hosts must be honest about how often they let, their average occupancy, whether they use third-party platforms like Airbnb, and whether the property covers multiple property types or uses. Failing to disclose can invalidate your entire insurance policy.

How Much Does Holiday Home Insurance Cost for an Airbnb?

Holiday home insurance cost depends on several factors, and prices vary depending on your property, location and usage. Rather than quoting a single figure, here's what drives the total cost.

Rebuild cost is a primary factor. This is the cost to completely rebuild the property - not its market value. Larger houses, listed buildings, thatched roofs and properties with complex construction push this figure up.

Location matters. Coastal properties in Cornwall, flood-risk areas in the Lake District, rural homes in the Scottish Highlands and city apartments in London or Northern Ireland all carry different risk profiles. Crime rates and distance to emergency services also play a role.

Occupancy and letting frequency. Insurers want to know how many nights per year the property is let, how often it sits vacant, and whether it's managed year round by a professional company or self-managed. Higher turnover generally means higher premiums.

To give a rough sense of scale:

Property size

Indicative annual premium

1 bedroom

~£289

2 bedrooms

~£325

3 bedrooms

~£429

4 bedrooms

~£596

5–6 bedrooms

£860–£1,300+

Adding accidental damage cover, higher contents limits, extended home emergency cover or public liability protection with higher limits will increase premiums - but these are often worthwhile for active hosts. In 2025, UK holiday home insurance premiums rose around 8.5% year-on-year due to rising repair costs and more severe weather events.

Ways to control costs: improve security (BS3621 locks, burglar alarms, CCTV where privacy-compliant), install leak detectors, pay annually rather than monthly, and avoid over-insuring. Most importantly, compare specialist holiday home insurance policies from holiday home insurance specialists rather than relying on a standard home insurance policy that may not provide cover for paying guests at all.

Does My Standard Home Insurance Cover Guests?

In most cases, no. Standard home insurance is written for a main residence and typically excludes or severely restricts cover when there are paying guests, sublets or frequent Airbnb bookings. Letting to guests converts the use from private residential to something insurers treat as business use.

Many insurers require you to declare any letting activity. If you don't, and then make a claim, the insurer may refuse it or void the policy entirely. Typical gaps in a standard home insurance policy include:

• No public liability cover for guest injuries
• No contents cover for theft or damage caused by airbnb guests
• No cover for loss of rental income
• Reduced or no cover when the property is left unoccupied for long periods

Some insurers offer add-on host insurance or home-sharing extensions for occasional letting, but these are limited and the definition of "occasional" varies. Always check your own policy documents carefully.

If you're considering listing your home, speak to your insurer or broker first. If they will not cover Airbnb or holiday lets, look at specialist holiday home insurance designed for short-term rentals. Avoiding this conversation is one of the most common mistakes hosts make.

What Cover Do I Need If I Fully Rent Out a Holiday Home on Airbnb?

If your property is a dedicated holiday home or investment - not your main residence - you need a comprehensive holiday home insurance policy that treats the property as a commercial asset.

This should include:

• Buildings and holiday home contents insurance at adequate sums insured
• Public liability insurance with limits appropriate for hosting guests (£2m–£5m)
• Employers liability insurance if you employ cleaners, maintenance staff or anyone working at the property
• Loss of rental income cover if an insured event makes the property unlettable for weeks or months
• Alternative accommodation costs if guests need to be rehoused

Insurers will want to know occupancy levels, nightly rates, whether the property is managed by a professional company like Pass the Keys, and whether there are facilities like hot tubs or swimming pools. They may also ask about safety compliance: gas certificates, electrical inspections, fire alarms, CO detectors and documented house rules for airbnb guests.

Holiday home owners should also be aware that council tax, business rates, planning restrictions and licensing requirements are separate from insurance - but all can influence how an insurer views the risk and whether they'll provide protection. For regulatory guidance, see our overview of short-term let regulations.

How Pass the Keys Helps Hosts Manage Risk and Insurance

Pass the Keys is a professional short-let and Airbnb management company operating across the UK, managing holiday homes and city apartments on behalf of property owners. We do not sell insurance, but we help hosts understand when specialist holiday home insurance is needed and what questions to put to insurance experts.

Our practical risk-management measures reduce the likelihood and severity of claims:

• Guest screening and identity verification to reduce the risk of malicious guest behaviour
• Cleaning and inspections between every stay, spotting damage early and maintaining safety standards
• 24/7 guest support so issues like leaks or emergencies are reported and addressed quickly
• Maintenance reporting that tracks small repairs before they escalate into major claims
• Documented inventories and photos before and after stays - essential evidence if an insurance or AirCover claim arises

We work alongside a host's chosen insurer, ensuring access for loss adjusters, coordinating emergency repairs and helping keep safety certificates current. All of this helps to protect rental income and minimise downtime.

If you're considering turning a home or second property into a professionally managed Airbnb, speak to your insurer and to Pass the Keys to get the right cover and management in place from day one.

Matthew Durrant concluded:

"Insurance should not just protect the building, it should protect the business behind it. Whether you let your property a few weeks each year or operate it as a full time holiday let, having cover that reflects how the property is actually used gives you confidence that your investment, your guests and your income are all properly protected."

Matthew Durrant is Managing Director of i4me, a UK specialist insurance broker focused on holiday homes and short term rental properties. Since 2016, i4me has helped protect more than 30,000 holiday lets across the UK. 

Every insurance policy is different. Holiday home owners must read their own policy documents carefully and, where needed, seek professional advice before relying on any type of airbnb insurance to cover damage, liability or lost income.