Holiday Apartment Insurance for Landlords: Comprehensive Protection for Your Property and Income
31 Mar 2025
12
Minutes
Katrin Straub
CEO at nextsure
Renting out your holiday home entails specific risks, from property damage to loss of rental income, which can often result in damages exceeding one million euros. Suitable insurance coverage is therefore essential for every landlord. Find out how to optimally secure your holiday property with the right policies.
The topic in brief and concise terms
A specialised holiday apartment insurance is essential for landlords, as standard policies often do not apply, and damages can quickly amount to several thousand euros.
Important components include residential building, household/inventory, and landlord liability insurance; rental income loss and legal protection insurance offer useful additional coverage.
The correct specification of the intended use (private/commercial) and any necessary change in use are crucial for full insurance coverage.
Minimising Risks: Essential Protection for Holiday Home Owners
Renting out a holiday apartment carries higher risks than a long-term rental, often by up to thirty percent. Frequent guest changes and vacant periods increase the risk of break-ins or undetected damage. A water damage incident can quickly incur costs of over €5,000 if noticed late. Standard private insurance often provides insufficient protection for landlords in these cases. Therefore, a specific holiday home insurance is essential for every owner. These specific policies take into account the special usage conditions and protect you against typical risks. This way, you protect your asset, which is often worth several hundred thousand euros.
Identifying Core Components: These Insurances are Essential for Landlords
For comprehensive protection of your holiday property, several insurance components are essential. The building insurance covers damage to the building itself, such as from fire, storms, or water damage. Ensure that natural hazards like flooding or earthquakes are also covered; this can increase the premium by about ten to twenty percent but is often indispensable. Household or contents insurance protects the movable furniture in your holiday apartment. It is crucial to determine whether you rent privately or commercially, as this affects the type of insurance; commercial policies often cover higher sums. Landlord liability insurance (often known as homeowner's liability) is indispensable. It steps in when third parties, such as your tenants, suffer harm on your property and make claims of up to three million euros. For clearly commercial operations with multiple units, a public liability insurance policy may be necessary to cover additional risks. Careful selection of these core components forms the foundation of your protection.
Optimize costs: Understanding premiums for holiday home insurance
The cost of holiday apartment insurance for landlords varies significantly and depends on various factors. These include the location (e.g. flood area), size in square meters, construction type, and quality of furnishings. A building insurance policy for a holiday home with 100 square meters can cost annually between 200 and 800 euros. The contents/inventory insurance for an averagely furnished holiday apartment with 60 square meters could additionally amount to 100 to 300 euros per year. Landlord liability insurance is often available from as little as 50 euros per year. By choosing an appropriate deductible, such as 250 or 500 euros per claim, you can often reduce the annual premium by five to ten percent. It is advisable to obtain at least three different offers and compare the services carefully. Some insurers offer package deals that cover multiple risks and can therefore be cheaper than individual policies. Certain insurance costs can also be claimed for tax purposes by landlords.
Implement additional protection: secure against rental loss and legal disputes
In addition to basic insurance, two additional policies can be very useful for landlords of holiday homes. A loss of rent insurance protects you from financial losses if your holiday flat is unlettable for several weeks or months after an insured damage (e.g. fire, water damage). This insurance then covers the lost rental income, often for up to twelve months. Check the conditions carefully, as vacancies between regular bookings are usually not covered. A landlord legal protection insurance is also an important addition. It covers the costs of lawyers and court fees in the event of legal disputes with tenants, neighbours or authorities – a dispute value of 5,000 euros can quickly lead to lawyer and court costs of over 1,500 euros. Such disputes can arise, for example, due to noise pollution or unpaid tourist tax. Premiums for landlord legal protection insurance start at around 150 euros per year. These additional components meaningfully complement your insurance cover.
Leverage expert knowledge: Avoid pitfalls and optimise insurance coverage
To optimally arrange the insurance coverage for your holiday home, you should pay attention to some expert tips. A frequently overlooked point is the correct change of use of your property for holiday letting with the building authority. Without this approval, the insurance coverage can, in the worst case, lapse, potentially leading to financial damages amounting to tens of thousands of euros. When arranging the insurance, be sure to state the correct type of usage (e.g. primarily private use with occasional letting or purely commercial letting). Incorrect information can lead to a refusal of benefits in the event of a claim, even if only a small part was incorrectly declared. Check your insurance coverage at least every two years and adjust it if necessary, for example after renovations that increase the property's value by more than ten percent. Keep a detailed inventory list with photos and purchase receipts; this greatly facilitates claims processing and can reduce the processing time by up to fifty percent. Our expert tip: Clarify with your insurer whether damages due to gross negligence on your part or that of your guests are also covered up to an amount of, for example, 10,000 euros. Paying attention to these points will ensure you have long-term reliable protection.
Special case online portals: Understanding the peculiarities of Airbnb and Co.
Renting through online platforms like Airbnb or Booking.com is popular, but it comes with specific insurance considerations. Some platforms offer their own protection programmes for hosts, such as Airbnb's 'Host Guarantee', which can cover property damage up to one million US dollars. However, these programmes are often not a complete substitute for a comprehensive holiday rental insurance policy for landlords. The conditions of these platform guarantees often include exclusions or provide for secondary liability, meaning that your private insurance must first pay out. Moreover, they usually do not cover liability claims or rental income losses. It is therefore essential that you tailor your own insurance coverage, particularly the landlord liability insurance and contents insurance, to the specific risks of short-term letting. Confirm with your insurer whether letting via such platforms is explicitly covered and if there are any restrictions, such as a maximum rental period per year (often 60 to 90 days). Transparent communication with your insurer about your rental activities is crucial.
Claims Management: Acting Correctly When Something Happens
If damage occurs in your holiday home, swift and correct actions are crucial for a smooth settlement with your insurance provider. Document the damage immediately and as thoroughly as possible with photos or videos – at least five to ten shots are recommended. Report the damage promptly, typically within a week, to your insurer. Carry out immediate measures to minimize damage, such as turning off the water supply in the event of a burst pipe, to prevent further costs of hundreds of euros. Keep damaged items until the situation is resolved with the insurer, as they often need to be inspected. Create a list of all damaged or stolen items including details of the original cost and date of purchase; the previously created inventory list can help here. In the case of burglary or vandalism, file a report with the police immediately – a copy of the report will be needed by the insurance company. Our expert tip: Keep the damage reference number you receive from the insurer ready for every communication to speed up identification and processing by up to thirty percent. Good preparation and prompt action in an emergency are worth their weight in gold.
Legal framework and obligations for landlords
Your next step to optimal protection: Individual risk analysis
More useful links
Deutscher Tourismusverband provides comprehensive information on holiday apartments.
IHK München offers essential information on rental law for landlords.
Gesetze im Internet enables direct access to laws and regulations, such as the German Civil Code (BGB).
FAQ
Which insurances are mandatory for holiday home landlords?
There is no legal requirement in Germany for a specific insurance policy for renting out holiday apartments. However, building insurance is highly recommended for every property owner and is often a prerequisite for financing. Landlord liability insurance is also indispensable to protect against high compensation claims.
Does my private liability insurance cover the rental of my holiday apartment?
Generally not sufficient. Personal liability insurance often only covers owner-occupied properties or excludes or severely limits renting to holiday guests. A separate landlord liability insurance (building and landowner liability) is necessary. This often costs from 50 euros per year.
What is the difference between home contents insurance and inventory insurance for a holiday apartment?
Contents insurance is intended for privately used (possibly occasionally rented out) holiday homes. If the holiday home is primarily rented out commercially, a contents insurance (also known as an inventory insurance) is necessary, which often covers higher sums insured and specific commercial risks.
Are damages caused by guests' vandalism covered by insurance?
Damage caused by vandalism can be covered by your inventory or household insurance, provided this component is included. It is important to check the specific terms of your policy, as there are differences between providers. A deposit can cover initial damages.
What happens if my holiday apartment is vacant for an extended period?
Extended vacancy (often defined as more than 60 or 90 days) can be considered an increased risk and must be reported to the insurer. Otherwise, coverage may be jeopardized. Some insurers offer special policies for holiday properties that take vacancy periods into account.
Can I pass on the cost of the holiday home insurance to the tenants?
The costs for building insurance and landlord liability insurance can be proportionately passed onto tenants through the service charges if agreed upon in the rental contract. However, for holiday homes with short-term rentals, this is unusual and usually included in the rental price. The costs for legal protection or rent loss insurance are typically not transferable to tenants.
