As the U.S. Economic Development Administration (EDA) explains, Park City, Utah, once cited as a "mountain ghost town," has become the country's largest skiing area and now attracts over 600,000 annual visitors.
As a real estate owner in this now-bustling ski town, you may want to consider renting your property to vacationers. Doing so lets you earn extra income and contribute to the local economy.
But before you market your property to vacationers, it's best to get vacation rental insurance coverage first. Our team at PMI Mountain Collection has shared insights into this matter, so please read on.
Why Do You Need Vacation Rental Insurance Coverage?
Even if you already have a homeowners' insurance policy for your vacation house (which you should, by the way), you must still insure it with extra rental property protection. A good enough reason is that most homeowners' insurance policies exclude coverage for short-term rentals in Park City, UT.
Without additional insurance, you could face costly vacation home risks due to potential short-term rental damage guests could cause. You may also face hefty legal expenses without liability insurance for rentals.
What Should Your Vacation Rental Insurance Cover?
Your vacation rental insurance policy should provide:
- Property damage coverage
- Liability coverage
- Loss of income coverage
Property Damage
Screening potential guests can help reduce your odds of sharing your Park City home with individuals who may harm your property. You do not want this, as damage to vacation property costs a lot.
You'll likely have to tap your savings to cover such expenses unless you have property damage coverage.
Besides, accidents happen. Even the most responsible guests can cause unintentional damage to your property.
An example is if your vacation rental is pet-friendly, and your guests are among the 78% of Americans who travel with their pets yearly, per Dogster.com. Unfortunately, their pet had a "toilet accident" that ruined your carpets. If you have vacation rental property damage coverage, it should kick in to help pay for repairing or replacing your damaged carpets.
Liability Claims
Liability coverage can help shield hosts against liability claims or lawsuits from guests or neighbors. Such claims may arise from accidents involving injuries on the rental property. For instance, if a guest sustains an injury following a fall incident caused by defective flooring.
Loss of Income
A fire or severe weather can damage your property and make it uninhabitable, forcing you to stop renting it out. If this happens, you'll be unable to generate rental income.
Fortunately, some vacation rental insurance policies provide loss of income coverage. With this, you'll receive compensation for lost rental income, provided it's due to a covered incident.
Protect Your Vacation Rental Property
Vacation rental insurance coverage can protect your Park City property from damage and you from legal liabilities. For this reason, never go without it if you plan to generate income by sharing your home with vacationers.
PMI Mountain Collection, our family-owned and operated property management firm, can help you obtain adequate rental insurance coverage. We'll use our decades of experience in business ownership and management, plus the support we get from PMI, our parent company with over 20 years of property management expertise, to help protect yours.
Get your free property consultation today so we can further discuss what we can do to help!
