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Why standard policies fall short?<\/strong><\/p>\n Most existing home policies are designed for personal use and exclude commercial activity.
He added that fire insurance policies still apply to guest houses, but broader protection is limited.<\/p>\n Dilip Baba, Head \u2013 Commercial & Speciality Underwriting, Go Digit General Insurance, pointed out that renting is treated as commercial usage and requires a different policy.<\/p>\n \u201cRisks can be covered under commercial property policies, which offer protection for property, theft, third-party liability, and even employee-related risks,\u201d he said.<\/p>\n Disclosure and exclusions<\/strong><\/p>\n Experts emphasise that homeowners must inform insurers about rental activity to avoid disputes.<\/p>\n \u201cFailure to do so could lead to denial of claims,\u201d said Ashwini Dubey, Head of Home Insurance, Policybazaar.<\/p>\n He noted that exclusions typically include poor upkeep, extended vacancy, or theft by a guest without forced entry. Liability claims from guest injuries are also not covered under standard plans.<\/p>\n Emergence of specialised products<\/strong><\/p>\n Insurers are slowly adapting. Dubey said some companies now provide \u201chomestay\u201d covers, with liability for guest injuries, property damage, and loss-of-rent protection.<\/p>\n \nBaba added that short-duration commercial covers are available for owners who rent properties only seasonally.<\/p>\n Verma said demand is pushing insurers to innovate further.<\/p>\n \u201cSome insurers in India now offer custom policies specifically designed for homestays or short-term rental properties,\u201d he explained. He also noted rising interest in embedded protection directly offered by listing platforms, mirroring global trends.<\/p>\n ALSO READ |\u00a0UPI new rules from September 15: Higher transaction limits for select high-value payments<\/a><\/strong><\/p>\n Travel shifts driving demand<\/strong><\/p>\n The insurance push comes as short-term rentals move into the mainstream of Indian travel.<\/p>\n \u201cAt ELIVAAS, we\u2019ve seen supply and demand grow by over 30% annually,\u201d said Ritwik Khare, Founder & CEO, ELIVAAS. He added that platforms now help hosts explore coverage options, making it easier to manage risks while tapping into rental demand.<\/p>\n Awareness gap remains<\/strong><\/p>\n Despite the growth, many property owners are still unaware of the risks.<\/p>\n \u201cMost assume their standard home insurance policy will automatically cover guest stays, but in reality, these policies typically exclude commercial or rental activity,\u201d said Caroline Mulliez, CEO, The Blue Kite.<\/p>\n She expects bundled insurance through property management firms to play a key role in bridging this gap.<\/p>\n Outlook<\/strong><\/p>\n Industry estimates suggest India\u2019s vacation rental market could surpass $2.5 billion by 2025. As demand rises, experts say customised insurance will become central to ensuring both property owners and guests are adequately protected.<\/p>\n ALSO READ |\u00a0How Travel Now, Pay Later is reshaping holiday planning in India<\/a><\/strong><\/p>\n<\/div>\n
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\n\u201cStandard home insurance policies typically exclude coverage for business activities, including short-term rentals or paying guests,\u201d said Pankaj Verma, Chief Technical Officer (Underwriting & Products), Zurich Kotak General Insurance Company.<\/p>\n