Short-stay rental insurance: cover for Airbnb-style hosts

What short-stay rental insurance is and who needs it

Short-stay rental insurance covers a home, unit or room that is let to paying guests for days or weeks at a time, usually through a booking platform. Anyone who hosts needs to check their cover. That includes people who let a spare room, or their whole home while they are away.

The rules differ by state.

  • NSW: the Code of Conduct for the short-term rental accommodation industry requires a host to hold insurance that covers their liability for third-party injuries and death on the premises. The cover must be valid for the period of each stay. Hosts must also register the property before advertising it.
  • Victoria: since 1 January 2025 an owners corporation can make rules that ban short-stay letting of lots, other than a lot that is the owner's or occupier's principal place of residence.

Other states, territories and local councils have their own registration and planning rules. Check them before you list, because cover can depend on the letting being lawful.

What is usually covered, and common exclusions

A policy designed for short stays can cover:

  • the building and the host's contents, including damage caused by guests
  • theft by guests
  • legal liability if a guest is injured
  • lost booking income while the property cannot be used after an insured event.

Standard home and landlord policies often exclude or limit claims that arise from paying guests. Do not assume an existing policy extends to hosting. The NSW Government tells hosts to review the terms and exclusions of their insurance carefully. Protection offered by a booking platform has its own terms and limits. It is not a replacement for checking your own policy.

Common exclusions:

  • hosting that was not disclosed to the insurer
  • letting that breaches by-laws, planning rules or registration requirements
  • wear and tear and minor accidental marks
  • guests' own belongings
  • theft where there is no sign of forced entry, under some policies.

How short-stay cover is sold

There are three common routes:

  • Direct insurers: some home and landlord insurers will add short-stay use as an option or endorsement. Others will not cover it at all.
  • Specialist underwriting agencies: these issue holiday-let and short-stay policies on behalf of insurers, either directly or through brokers.
  • Brokers: a broker can compare what several insurers and agencies will accept.

A broker is the usual route when the use is mixed, for example you live in the home for part of the year, when you host at several properties, when the property is run as a business with staff or cleaners, or when a direct insurer has declined the risk. Check any broker or agency on the ASIC professional registers. The Insurance Council of Australia also runs a Find an Insurer service.

What makes short-stay cover hard or expensive to get

  • A high turnover of guests, which insurers see as raising the chance of damage and injury claims.
  • Pools, spas, decks, bunk beds and fireplaces.
  • Properties that are empty between bookings.
  • Strata buildings, where by-laws may restrict hosting and the building policy does not cover your liability inside the lot.
  • Coastal, flood or bushfire locations.
  • Large homes marketed for groups or events.

When you apply, take reasonable care to answer the insurer's questions accurately, including how many nights a year the property is let. A wrong answer can affect a later claim.

Questions to ask before buying

  • Does the policy cover paying guests, and is there a cap on nights per year?
  • Does the liability section cover injury to guests? In NSW, does it meet the Code of Conduct requirement?
  • Is guest damage covered if it is accidental, or only if it is malicious?
  • Is theft by a guest covered without forced entry?
  • Is lost booking income covered, and for how long?
  • Do I need to tell my strata scheme or its insurer?
  • Am I still covered when I live in the home between bookings?

Where to complain

Raise the problem with the insurer first and ask for its internal complaints process. Insurers generally have 30 calendar days to give a written answer. If a broker arranged the policy and the issue is their advice or service, complain to the broker.

If the complaint is not resolved, you can go to the Australian Financial Complaints Authority (AFCA), which is free. AFCA can tell you whether your policy is within its rules. Call 1800 931 678.

Find a licensed broker

Browse businesses licensed to arrange general insurance in your city, or search every state.

Sources

Last checked: 2026-10-06

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