Most VRBO hosts assume they have more insurance protection than they actually do. The platform provides $1 million in liability coverage automatically, so there's something in place. The average host may have a homeowners policy already on the property, especially if they were living in it first and decided to turn it into a rental. And VRBO offers optional damage protection that guests can purchase at checkout.
Three layers of coverage sounds solid until you look at what each one actually does. In practice, these three things cover far less than they appear to. They overlap in ways that don't help you, and they leave out some of the most common and costly scenarios VRBO hosts face; homeowners insurance might not cover anything at all.
Knowing how each one works, and where each one stops, is the difference between feeling insured and actually being insured.
What VRBO actually covers, and where the gaps begin
VRBO automatically provides every host with $1 million in liability insurance at no extra cost. If a guest slips on your stairs and sues, or accidentally damages a neighbor's property during their stay, VRBO's program through Generali Global Assistance kicks in as primary coverage. No additional premium, no action required on your part.
The problem is, liability coverage and property insurance are two completely different things, and VRBO's built-in program only handles one of them. If a guest floods your bathroom, smashes furniture, or walks off with your appliances, that $1 million policy does nothing for you. It applies strictly to third-party bodily injury and third-party property damage. Your property isn't "third-party" – it's yours.
VRBO's coverage only applies to reservations booked and paid through VRBO's online checkout; direct bookings, off-platform payments, and reservations processed outside VRBO's system aren't covered. If you don't already carry your own liability policy, VRBO imposes a 25% deductible on any claim. That penalty for being underinsured is easy to miss in the fine print.
Perhaps most importantly, VRBO's coverage doesn't do anything for you if your property faces significant damage, be it from a fire or a wind storm blowing a tree into your house. Nor does it reimburse you for rental income you would have earned in the time the home was being repaired.
VRBO offers optional Property Damage Protection, but this is a product travelers can purchase during checkout, not something you control or receive automatically. Many guests skip it. When they do and something breaks, you're negotiating through VRBO's damage resolution process with whatever documentation you can pull together. That's a dispute process, not a claims process backed by a real insurer.
VRBO's built-in coverage is a useful supplement. It is not, and never was, a substitute for a real insurance policy.
Why your homeowners policy probably won't cover short-term rentals
If you're already insured on the property through a standard homeowners policy, you might assume you're covered for rental activity. Most VRBO hosts discover otherwise, usually at the worst possible time.
Standard homeowners insurance is built around owner-occupied properties. Most policies define coverage around the "residence premises," meaning the place where you actually live. Once you hand keys to a paying guest, the nature of the transaction changes. Legally, that's hospitality and commerce, not personal residence. Many carriers have explicit business activity exclusions that void coverage the moment rental income enters the picture. Some will cover occasional rentals, but define "occasional" in ways that don't survive scrutiny when claims are filed.
Traditional landlord policies designed for long-term tenants have a different problem. They're built for someone on a 12-month lease who treats the property with a reasonable degree of care because they live there. Short-term vacation rentals have different occupancy patterns, higher turnover, more strangers with keys, and substantially higher risk by most carriers' assessment. A standard landlord policy written for long-term tenants will often exclude STR activity outright, or limit coverage in ways that only become apparent at claims time. That's exactly why landlord insurance written specifically for short-term rentals exists as its own product category.
Carriers have denied claims on vacation rentals because the activity fell outside the policy's scope, even when the owner had been paying premiums for years and nobody flagged the gap. You want to find this out before something happens, not after.
Luckily, many landlord insurance providers sell policies specifically designed for STRs. These are the top options available on the market, with all providing quick options to get a quote online.
Types of insurance for vacation rental hosts
Before comparing providers, it helps to understand the actual categories of coverage that apply to vacation rental properties. These aren't interchangeable; each one protects against a different set of scenarios, and most serious VRBO hosts end up needing some combination of all of them.
Dwelling coverage pays to repair or rebuild the physical structure of your property after a covered event. If a kitchen fire guts the unit or a tree crashes through the roof during a storm, dwelling coverage is what funds the rebuild. This is the most fundamental piece of any landlord insurance policy, and it's the one VRBO's platform coverage doesn't touch at all.
Liability coverage protects you when someone gets injured at your property and holds you responsible. A guest falls down the stairs. A child cuts themselves on a broken railing. A visitor trips over a garden hose and fractures a hip. Liability covers the medical costs, legal fees, and settlement or judgment if it goes that far. VRBO provides $1 million in liability through Generali, but only for stays booked through their platform. If you take direct bookings or list on multiple platforms, you need your own policy for the gaps.
Loss of rental income coverage reimburses you for the bookings you lose while your property is uninhabitable due to a covered event. Say a burst pipe causes enough water damage that you have to cancel six weeks of reservations while the floors and drywall are replaced. Without this coverage, you absorb that lost revenue on top of the repair costs. With it, you're made whole on both sides. VRBO doesn't offer anything like this.
Some hosts also carry umbrella insurance for liability beyond their policy limits, or flood insurance in FEMA-designated zones where standard policies exclude water damage from rising water. These are situational, but worth evaluating depending on where your property sits.
The providers below each handle these coverage categories differently. Some bundle everything into a single policy. Others are stronger in certain areas and thinner in others. Knowing what you're comparing makes it easier to evaluate which one fits your property.
The best VRBO insurance options for hosts
1. Steadily: best for VRBO hosts who want landlord-grade coverage
Steadily offers short-term rental insurance designed for landlords who treat their properties as real investments. Unlike guest-protection products and platform programs, Steadily issues actual landlord insurance policies covering your property, liability, and lost rental income under a single policy, available in all 50 states. And they write policies specifically for short-term rentals, including anything that can be listed on VRBO.
The policy covers the specific risks of short-term rental activity: guest-caused damage, vandalism and burglary, fire, water damage, storm and hail, and riot and civil commotion. In addition, Steadily provides legal liability coverage of their own that is much more comprehensive than what VRBO provides, and still works if you list on Airbnb or as a direct booking. They also reimburse for loss of rent if a covered event takes your unit off the market.
Through Steadily's online quote portal, policies can be quoted and bound the same day, which matters when you're trying to meet a lender requirement or a VRBO listing deadline.
What separates Steadily from most STR-specific products is the nature of the policy itself: it's landlord insurance written for short-term rental use, not a hospitality protection plan or a damage waiver dressed up as coverage.
Get a free quote in minutes for your VRBO property:
2. Proper Insurance: VRBO's officially endorsed provider
Proper Insurance holds VRBO's official endorsement and is the platform's recommended provider for hosts who want maximum coverage depth. Policies are written as commercial business policies through Lloyd's of London and Concert Specialty Insurance. That's a different category from standard personal lines products, and it matters when you're filing a large claim.
Proper replaces your existing homeowners or landlord policy entirely rather than supplementing it. Their policies cover buildings and contents at replacement cost, include actual loss sustained business revenue protection with no time limit, and extend liability to amenities like pools, hot tubs, and bikes that most standard policies specifically exclude. They also include bed bug protection, squatter protection with legal coverage, and liquor liability. Niche, but these reflect real exposure for vacation rental operators.
Hosts who've had to actually use the policy report it performed the way it was described, which is not nothing when it comes to insurance. The tradeoff is cost and process: premiums run higher than Steadily's, and quoting requires working with an agent. For hosts managing multiple high-value properties, that depth of coverage makes sense. For a single property on a tighter budget, it may not.
3. Obie: for investors managing multiple STR properties
Obie built their platform for real estate investors who think in portfolios, not individual listings. Their signature feature is a property-level risk map that flags specific hazards near each investment: flood plains, wildfire exposure, crime data. This feeds into their underwriting, but it's also useful intelligence for investors evaluating new markets before buying.
Coverage spans single-family homes, multifamily, condos, and short-term rentals, with portfolio policies for investors managing multiple listings. Pricing typically falls between $1,200 and $3,500 annually. For a single VRBO property, the platform may be more than you need. For a portfolio of five or ten listings, it starts to make sense.
4. Foremost: a traditional carrier that writes vacation rental policies
Foremost is a subsidiary of Farmers Insurance and one of the few legacy carriers that explicitly writes policies for properties rented on a daily, weekly, or monthly basis. That matters because a lot of traditional insurers will either refuse to cover short-term rental activity or bury exclusions in the fine print that void your coverage at claims time. Foremost doesn't play that game; their vacation rental product is purpose-built.
Policies can be written with either named peril or comprehensive coverage on the dwelling, with Coverage A limits up to $1 million. Foremost also accepts homes of any age and properties with credit or loss history that might disqualify you elsewhere. They offer two package tiers (Landlord Package and Landlord Platinum Package) that bundle common endorsements so you're not piecing together coverage add-on by add-on.
The tradeoff is that Foremost operates through independent agents rather than a direct online quote process. You'll need to call or work with a local agent to get pricing. Recent quotes have come in around $1,500 per year for inland properties, though coastal and high-value homes will run higher. For hosts who want a recognizable carrier with financial stability behind their vacation rental (Foremost holds an A-rated financial strength rating), it's a solid pick.
Platform protection programs vs. actual insurance
A few services market "protection programs" that hosts sometimes mistake for insurance. They aren't. VRBO's damage deposit mechanism, Airbnb's AirCover, and various guest protection products sold at checkout are useful for managing routine damage disputes. They're administered by the platform or a third party, subject to that party's discretion, and carry no regulatory standing as insurance products.
The difference matters when the loss is serious. Platforms resolve damage disputes; insurance companies pay claims. If your vacation rental burns down or a guest is severely injured and hires an attorney, you need a policy with a licensed carrier behind it.
How to figure out what you actually need
The right coverage for your VRBO property comes down to a few specifics. Property value and type affect both the risk profile and the replacement cost. How often you rent affects how underwriters categorize your use. Your state matters too; some jurisdictions require proof of insurance for STR permit applications, and local rules vary more than you'd expect.
If you've been renting on VRBO for a while without dedicated coverage, getting a real policy in place should be a near-term priority. The longer you operate without one, the more you're counting on nothing going wrong.
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