Travel Insurance for Your Vacation Rental Guests

    travel insurance for vacation rentalsTravel insurance offers owners extra security and protects rental income in case travelers cancel their reservations. You don't want to get stuck with a last-minute opening or a potential guilt-trip refund! Travel insurance is a smart and professional way to protect both you and your guests. And, even better, it is purchased by your renters – you don’t pay a dime

    Because vacation rentals are a new way of traveling for many people, you may get inquiries from travelers who are accustomed to hotel cancellation policies that allow as little as 24-hour notice with no penalty. By encouraging your renters to buy a travel insurance plan, you can ease their minds about far-in-advance bookings.

    Note: Travel insurance is entirely separate from your regular homeowners or liability insurance coverage. Vacation Rental/Homeowners insurance would be purchased under your name, but travel insurance would be purchased by your guests under their names.

    The Benefits of Travel Insurance

    The main upside of trip insurance is that it can alleviate the burden of cancellations, refund issues, and open dates at your vacation rental. Let's say you've got a renter scheduled to arrive at the end of the month and you've already collected the full rental payment. If your renter calls and has to cancel their reservation due to a family illness, there is little chance you would be able to re-book those dates this late in the game. If they purchased a travel insurance policy that covers cancellations for medical emergencies, then any amount paid to you should be reimbursed by the insurance company. Because the insurance is taking care of it, you won't feel guilty about sticking to your guns when it comes to your refund policy.

    How to Encourage Renters to Purchase Travel Insurance

    To encourage renters to purchase travel insurance, include a clause in your rental agreement and suggest it in inquiry correspondence. Any time a guest asks about your cancellation policy, you should always follow up with information on travel insurance.

    You may also ask your renters to sign a waiver that acknowledges that they have been offered travel insurance and declined it. This will help to remind them of the importance of securing travel insurance, whether they buy it through an organization you have recommended or seek out a supplier themselves.

    The cost of travel insurance can range from as little as $35 up to a few hundred dollars. Ideally, your renters should purchase their insurance policy within seven days of booking your home in order to get the best rates. Caution your guests to make sure they read the policy guidelines carefully before purchasing to understand what kinds of cancellations are covered.

    Quick facts about trip insurance that may interest renters:

    • It can protect against unforeseen events that may cause renters to cancel their travel plans
    • It may reimburse nonrefundable pre-payments and/or deposits
    • It may cover emergency medical expenses if the renter purchases a more comprehensive plan
    • It may cover miscellaneous expenses caused by travel delays, such as transportation and lodging expenses or, if baggage is delayed, the purchase of essential items
    • It can also protect against lost, stolen or damaged baggage
    • It typically costs 5 to 7 percent of the total trip cost

    Sample rental agreement clause

    CANCELLATIONS: A sixty (60) day notice is required for cancellation. Cancellations that are made more than sixty (60) days prior to the arrival date are subject to a 5% cancellation fee or $50 whichever is greater. Cancellations or changes that result in a shortened stay, or that are made within 60 days of the arrival date, forfeit the full advance payment and reservation deposit. Cancellation or early departure does not warrant any refund of rent or deposit. You may choose to purchase travel insurance separately.

    STORM POLICY/ROAD CONDITIONS (mountain property): No refunds will be given for storms. Mountain roads can be curvy and steep. Gravel drives are well maintained, however we do not refund due to road conditions; we highly recommend you purchase travel insurance.

    HURRICANE OR STORM POLICY (beach property): No refunds will be given, we highly recommend you purchase travel insurance.

    TRAVEL INSURANCE: We highly recommend your purchase travel insurance. If you wish to purchase travel insurance, go to _______ for details and to purchase.

    I hereby give permission to charge my credit card for the amounts above. I agree that all rental monies are non-refundable per cancellation policy above. I have read my rights to purchase travel insurance. By Signing Below, I agree to all terms and conditions of this agreement.


    I acknowledge that I have been offered travel insurance and I have opted not to accept it.



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