Renting a vacation home, renting out your own home or doing a home exchange
Your homeowners insurance policy provides coverage for your personal property when you reside temporarily in another residence, so you're covered while you're away on a vacation or for another reason. If you're renting out your home for a short period of time -- such as a week or several weekends -- some insurance companies may cover such short-term rentals under your homeowners policy. Other companies may require an endorsement to the existing homeowners or renters policy in order to provide insurance coverage.
If you do this on a regular basis, though, it is viewed as a "business." Therefore, your standard homeowners insurance does not provide coverage for business activities conducted in the home. To be properly covered, you need to purchase a business policy, specifically either a hotel or a bed-and-breakfast policy.
Discuss any liability limits prior to agreeing to a home exchange, says Sloan. For example, find out who pays if your negligence causes a fire. The bottom line: Let your insurance company know what you're doing.
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