By: Owen Shotkoski
Owning a home at the Lake of the Ozarks can be a great investment. If you’re using it as a full-term rental or just renting it out the weekends you don’t stay there, your insurance coverage may vary.
Many homeowners don’t realize that renting their home to guests can create additional risks; a standard homeowners policy may not be designed to handle these risks.
You May No Longer Be Considered a Typical Residence
A standard homeowners policy is designed for a home occupied by its owner and family. Once a rental opportunity enters the picture, insurance companies may consider it a business or rental property exposure. Coverage is affected by:
- Property Damage caused by renters
- Gues injuries
- Personal belongings
- Loss of rental income
- Liability claims
- Short-term rental activities
What About Your Dock?
For Lake of the Ozarks homeowners specifically, dock coverage is crucial. With the addition of a dock on the images for rental websites increasing potential guests, it’s important to keep them in good shape and have them covered on your policy. Docks create bigger liability and property risks.
Your insurance should reflect your ownership of the dock for adequate coverage.
Don’t Forget About Liability
Guests renting out your home could get injured in many ways. If you’re found responsible for an injury, liability coverage may help cover medical expenses, legal defense costs, and potential settlements or judgments.
Because vacation rentals can have more people coming and going than a typical residence, it’s worth reviewing your liability limits and considering whether an umbrella policy makes sense for your situation.
What Happens If You Can’t Rent the Home?
Imagine a summer storm damages your roof and the home needs several weeks of repairs during peak rental season. The repair bill and loss of rental income could be detrimental.
Depending on the policy, loss of rental income or business income coverage may help replace some of the lost income following a covered loss. This is important for anyone relying on rental income for their Lake of the Ozarks home.
What About Airbnb or Vrbo?
If you’re renting your property through Airbnb, Vrbo, or another short-term rental platform, don’t assume the platform’s protection automatically replaces your homeowners insurance.
Platform-provided coverage can have limitations, exclusions, and specific requirements. Your insurance policy should be reviewed based on how you actually use and rent the property.
Before You Rent Your Lake Home
Before accepting your first reservation, consider reviewing:
- Homeowners or vacation rental coverage
- Personal property coverage
- Liability limits
- Dock and boat lift coverage
- Loss of rental income coverage
- Umbrella liability coverage
- Short-term rental exclusions
- Boat and personal watercraft insurance
If you’re thinking about turning your lake house into a vacation rental, talk with your insurance agent before you start renting. A quick coverage review can help identify potential gaps and make sure your home, dock, guests, and rental income are properly protected.
Own a rental property at Lake of the Ozarks? Contact us at Rock Island Insurance (573)-557-9888 for a personalized insurance review and find out whether your current coverage is keeping up with the way you use your property. Click here for a quote on home, auto, or boat coverage.