Short-term rental insurance gaps in Texas

Short answer. First, make sure your insurance company knows the Texas home is rented short-term: tell it or your agent. Then check the usual gaps: liability limits and injuries away from the house, guest damage that counts as wear and tear, theft of furnishings, bookings lost after damage, and a platform's host protection that covers less than hosts assume.

If you haven't yet told your insurance company or your agent how the home is rented, start with Short-term rental insurance in Texas. It matters more than anything on this page: the Texas Department of Insurance (TDI) says "most policies won't pay for damages or injuries that occur during short-term rentals" (TDI home insurance guide). Hiding how the home is used can also cost you the policy. TDI's standard dwelling form says the policy "is void as to you, if you have intentionally concealed or misrepresented any material fact" (TDP-3, Conditions). Texas law lets that clause apply only if the fact was material (important to the risk) or contributed to the loss (Ins. Code §705.004).

This guide is the next step: once the insurance company knows, which parts of a short-term rental still tend to fall between policies?

The gaps at a glance

The TDI dwelling form (TDP-3) quoted on this page is public, so we use it to show what policy wording looks like. Many insurance companies now use their own forms, and policies written for short-term rentals differ from it. Your own policy is the one that counts.

Guest injuries: limits, and what happens away from the house

Is liability on the policy at all? A landlord (dwelling) policy does not always include liability; the TDP-3 has no liability section. See Landlord liability insurance in Texas. TDI's advice to people who rent out their home: "Ask your insurance company if you should add coverage for paying guests" (TDI).

Injuries away from the property. Liability coverage is built around the property. If you provide kayaks, paddleboards, bikes or golf carts that guests take elsewhere, ask whether an injury away from the house is covered, and don't assume. The platform's program won't necessarily fill that gap either. Airbnb describes its host liability insurance as covering an event "that happens during a guest's Airbnb Stay at the Host's Accommodation." Its exclusions include injury or damage "connected in any way to watercraft," and injury or damage "connected in any way to aircraft, autos, and mobile equipment," which may reach a golf cart. Each has narrow exceptions, such as a boat that is itself the listing (Airbnb article 3145, last updated June 30, 2026).

Claims that aren't a physical injury. Airbnb's program summary also excludes personal and advertising injury claims, such as wrongful entry or privacy claims, and claims tied to a camera that was not disclosed in the listing or that watches the inside of the home (article 3145). Ask whether your own policy includes personal injury coverage, and read what it says about cameras and entry.

Limits don't simply stack. Airbnb's summary says "$1,000,000 USD is the total limit available per Airbnb Stay." For some hosts, it says the program "may require contribution from any other applicable insurance or apply as excess coverage," and that failing to disclose your other insurance "may impact coverage." Your policy's "other insurance" wording decides the rest. We explain why several policies don't automatically add up in the liability guide.

Guest damage versus wear and tear

Short-term rentals wear faster: more check-ins, more luggage, more towels. Most of that is wear and tear, and almost no one pays for it:

• The TDP-3 excludes loss caused by "wear and tear, deterioration or any quality in property that causes it to damage or destroy itself" (TDP-3).
• Airbnb's reimbursement program for hosts, which it calls Host damage protection, excludes "damage from normal wear and tear" and "cleaning associated with normal check-out tasks," and Airbnb says cleaning and pet fees "are meant to cover expected costs" (article 279).

Deliberate damage by a guest is usually treated as vandalism and malicious mischief (damage done on purpose). The TDP-3 lists it among the perils it covers for your belongings, and the building is covered for it unless an exclusion applies. But the form drops fire, lightning and vandalism when the building has been vacant for 60 days in a row before the loss. Whether a furnished home in a quiet off-season counts as "vacant" depends on the policy. Separately, the TDP-3 does not pay for freezing damage while the house is unoccupied, unless you kept the heat on or shut off the water and drained the pipes. See Vacant rental property insurance in Texas.

Accidental damage to furnishings is the quieter gap. On the TDP-3, your belongings are covered only for eleven named perils, such as fire, wind and hail, and vandalism. A red-wine spill on a sofa, or a TV knocked off its stand, is not on that list. Some policies written for short-term rentals cover more; ask which kind yours is. For damage by long-term tenants, see Does Texas landlord insurance cover tenant damage?

Deadlines differ. Airbnb asks hosts to file a reimbursement request "within 14 days of the responsible guest's checkout" (article 279). Your own policy asks for prompt notice of a loss. Photograph the house between stays, so you can show what changed and when.

Theft of furnishings and contents

• Theft may not be covered at all. The TDP-3 excludes theft of any property "which at the time of loss is not an integral part of any structure" (TDP-3), so a missing TV, grill or set of linens falls outside it. Some policies add theft back by endorsement (a form attached to the policy that adds or changes coverage). If yours does, ask whether theft by a guest you let in is treated differently from a break-in.
• Contents need their own limit. The TDP-3 applies only to "coverages for which a limit of liability is shown." If there is no limit for personal property on your declarations page, most of your furnishings are not covered, however well the building is insured. (On the TDP-3, a refrigerator and stove, floor coverings and window shades you own as a landlord count as part of the dwelling.)
• The platform's program has its own rules. Airbnb's Host damage protection lists "damage to your home, furnishings, valuables, or belongings caused by guests" and takes requests for "missing items," but excludes "loss of currency" (article 279). In Airbnb's own terms, valuables are listed; cash is not. It applies only to a stay booked on Airbnb, and only if the guest doesn't pay first.
• Keep an inventory: photos and receipts for what is in the house. The TDP-3 asks for "a complete inventory of damaged personal property" after a loss.

Bookings you cancel after damage

Loss of rent coverage (on the TDP-3, fair rental value) pays rent you lose while a covered loss makes the home unfit to live in. Three things decide whether it helps a short-term rental:

1. The cause must be covered. The TDP-3 pays loss of use only when "a loss caused by a Peril Insured Against" makes the dwelling "wholly or partially untenantable." It excludes "loss to machinery, appliances and mechanical devices caused by mechanical breakdown," so bookings cancelled because the air conditioner simply failed in August are not a covered loss on that form. Some policies offer equipment breakdown coverage for that; ask. Wear and tear isn't covered either.
2. How the income is measured. The TDP-3 pays "the fair rental value of that part of the dwelling … usually rented to others by you, less any expenses that do not continue." Short-term income rises and falls with the season, so ask whether your policy pays a fixed rental value, the bookings you actually lose, or your past earnings, and for how long.
3. The limit. On the TDP-3, all loss of use together is capped at 20% of the dwelling limit (the amount the house itself is insured for). Other forms set their own limit or time period. See Loss of rent coverage for Texas landlords.

A platform may cover a narrower slice. Airbnb says its Host damage protection covers "income lost if you need to cancel confirmed Airbnb bookings due to damage caused by a guest (or their invitees)" (article 279). That is guest-caused damage and Airbnb bookings only: not hail, not a burst pipe, and not bookings from anywhere else. Airbnb also sells separate lost-earnings insurance with its own triggers (Airbnb); if you buy it, ask how it fits with your own policy's loss of rent.

Platform host protection and your own policy

TDI notes that "some home-share websites and apps offer coverage you can buy" (TDI); some platforms also include protection with every booking. What that protection is, and isn't, is in Short-term rental insurance in Texas. One more point, from Airbnb's own terms:

• It follows the booking, not the house. The liability program applies only when there is "an actual Airbnb Stay"; "canceled Airbnb Stays and no-show situations are not entitled to coverage" (article 3145). Direct bookings, other platforms, and the days between stays are for your own policy.

If you list on more than one platform, read each one's terms; don't assume they match. (Airbnb pages read September 30, 2026. Airbnb can change these terms.)

Does my condo association's insurance cover my short-term rental?

Only part of it. For a Texas condominium, Property Code §82.111 sets out the association's insurance, whenever the declaration was recorded: §82.002(c) applies it to older condominiums too, for events since January 1, 1994 (Prop. Code ch. 82). In short:

• The association insures the common elements (the shared parts of the building and grounds). Where the declaration describes units with horizontal boundaries (a unit above or below another), its property insurance must also include the units, "to the extent reasonably available," but "need not include improvements and betterments installed by unit owners." Your upgrades and furnishings may be yours to insure.
• A claim under the association's policy "must be submitted by and adjusted with the association," and the money goes to the association or its trustee for repairs, not to you.
• The association's policy may have "commercially reasonable deductibles." Ask how large its deductible is and how the association treats it after a loss.
• If your guest causes the damage, the association may charge you its deductible and any cost above what its insurance pays. The law says so for damage due to an act or omission of "a guest or invitee of the unit owner" (§82.111(l)). Ask your own insurance company whether your policy covers that charge.
• The association's liability insurance protects you only "with respect to liability arising out of the person's ownership of an undivided interest in the common elements or membership in the association." An injury inside your unit is a job for your own policy, and that policy needs to know about the short-term use.

Ask the association for a copy of the master policy's declarations page and its rental rules before you list.

If the home is in an HOA

A homeowners association's deed restrictions may limit short-term rentals, and a city may not enforce them for you. Georgetown's FAQ, for example, says "an HOA may create their own requirements for short-term rentals" and that the city "cannot enforce any STR requirements created by an HOA" (Georgetown STR FAQs). Read your HOA's rules for rental limits and for any insurance they require.

A city permit is not insurance

A city license or registration says the city allows the rental; it says nothing about your insurance, and Austin stopped asking for proof of insurance in October 2025 (City of Austin). Current city rules, checked and dated, are in Short-term rental insurance in Texas. If you operate without a license the city requires, ask your insurance company how that affects the policy.

Pools, hot tubs, docks and other amenities

Amenities are why guests book, and they are where many of the questions on an application sit.

• Liability. Insurance companies often ask about pools, hot tubs, diving boards, trampolines, docks and anything guests can ride or float on. TDI says "many homeowners policies provide minimal or no liability coverage for swimming pools," that "many insurers – and city ordinances – require pools to be enclosed by a fence and locking gate," and that an insurer "may not provide liability coverage for a pool with" a diving board or slide (TDI, swimming pools). That page is about homeowners policies, so ask how yours treats a pool, a hot tub or a dock, and answer the application questions exactly.
• Renting the amenity on its own. TDI: "If you want to rent out your pool or storage area, but not the house, you probably need specific coverage" (TDI).
• The pool itself. The TDP-3 excludes loss to the dwelling caused by "settling, cracking, bulging, shrinkage or expansion" of foundations, walls and "swimming pools," with some exceptions.
• Boats and kayaks you own. The TDP-3 covers watercraft as your belongings only "while located on land on the described location." On the water, they are outside it.

Before your next booking, or your next renewal

• Liability limit on the declarations page, per occurrence and in aggregate
• Whether liability reaches kayaks, bikes and other things guests take off the property
• Personal injury coverage (wrongful entry, privacy)
• A limit for your furnishings, and which perils cover them
• Theft: excluded, added back, or limited for guests?
• Loss of rent: on the policy, how short-term income is measured, and for how long
• Each platform's terms, for each platform you list on
• HOA rules and, for a condo, the master policy's coverage and deductible
• City license or registration
• Pool, hot tub, dock and water toys: asked about, limited or excluded?
• Photos of the house and an inventory, updated each season

AIV Insurance is an independent insurance agency in Texas, not an insurance company: we don't issue policies, and claims go to your insurance company. If you'd like us to check these gaps with you, email hello@aivinsurance.com, or reach us through the contact page and we'll tell you how to share your declarations page securely. We ask how the home is rented, and we check the options available to us for a home used for short stays.

Airbnb is a trademark of its owner. AIV Insurance is not affiliated with it.