Financial Matters Lodging Tax

Is your rental home adequately insured?

Written by Elizabeth Weedon
Is your rental home adequately insured?
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By now, most of you are aware that the new MA Lodging Tax on short-term rentals includes a requirement that every home carry at least $1 million in liability insurance.  So, take a look at your current policy to determine the amount of liability coverage you have. If it’s not adequate, the first step is to contact your insurance agent.

To start, make sure that your agent is  aware that you rent out your home. This is very important as rental homes can have different coverage than normal homeowner policies, and some insurance carriers have different requirements for rental homes.

If you are currently insured through the Mass Fair Plan (MPIUA), which caps its liability coverage at $500,000, or your policy with another carrier is less than $1M, you have two options in order to comply with the requirement:

  • Take out an umbrella policy to supplement your current one. One option for a supplemental or umbrella policy is AAA.
  • Cancel your current policy when it expires and create a new one from a carrier that protects your rental home adequately, including the $1M in liability coverage. One good option is a division of Lloyds of London called Proper Insurance.

The new MA Lodging Tax can be daunting, but there is no question that it’s in the best interests of us vacation rental homeowners to be adequately protected while we open our homes to strangers.

About the author

Elizabeth Weedon

Elizabeth Weedon - Although I’ve worked for since 2008, I’ve been a loyal homeowner on the site since early 1998, just a few months after the website was launched by the Talmadges. I grew up summering on the Vineyard and managed my family's rental home there since the mid-1980’s. I’m passionately devoted to the Vineyard – and to WeNeedaVacation, which I credit with enabling me to hold onto the special property that has been in our family for nearly a century. An enthusiastic member of the WNAV Homeowner Support Team, I endeavor to keep my finger on the pulse of the Cape and Islands vacation rental industry so that I can provide homeowners advice about how to ensure their booking success with us. With owner Joan Talmadge, I am also responsible for editing and writing much of the text on our website, our monthly newsletters, and Homeowner Blog posts. Email Elizabeth

1 Comment

  • FYI: A company that I have seen mentioned on web in various places as a source for rental liability insurance is CBIZ so I contacted them just to see as alternative to what I have now. They wouldn’t touch my place because I still have perfectly valid but older fuse boxes and the cost to convert those is prohibitive.