Proper Insurance Review & Complaints: Vacation Rental Insurance (2023)

Proper Insurance is a specialty company that caters to the needs of people who own and operate short-term vacation rentals. Their coverage includes homes listed on Airbnb, VRBO, and similar services.

Who is Proper Insurance?

Proper Insurance is a Virginia-based property & casualty insurance that focuses solely on insuring homes that are used as vacation rental properties. The company was created in response to the growing popularity of short-term rentals through services like Airbnb, and the lack of access to policies designed specifically for this sort of use.

Policies for property owners through Proper are underwritten by Lloyd’s of London, one of the best-known and largest specialty and reinsurance companies in the world. The policies are available for property owners and property managers of homes across the country, and they are sold directly through the company website or over the phone. Independent agents may also sell these products, although the relative newness and specialty nature of the policies may make it more difficult to locate an insurance agent.

Proper is endorsed by major vacation rental site HomeAway and is recommended by more than a dozen other similar sites.

What policies can you get?

Proper Insurance writes solely short-term rental insurance policies; these replace a homeowner’s or landlord policy and provide all the same coverage as well as protecting against the added risks of running a short-term rental.

Policies can be taken out for homes that are used as full-time vacation rentals, homes that are sometimes owner-occupied and sometimes rented, and even homes that are owner-occupied full time with a portion of the house – from a suite to a single room – that is regularly rented out through a service like Airbnb. Landlords should compare Airbnb vs renting your home to decide what is the better option.

The Proper policy combines the coverage of a homeowner’s policy with that of a commercial package, along with the coverage you would get with a landlord policy. These are available for current homeowners, short – term vacation rental owners like Airbnb rentals, and more for property coverage.

The basis of the policy is essentially a commercial package policy, covering the dwelling with no limitations on use and all the contents. It also includes commercial liability and business income for lost rents when the home is being repaired after a covered claim. The named insured can be an individual or a business, including an LLC or sole proprietorship.

Liability

The commercial general liability is available with limits of either $1 million or $2 million, and there is also $1 million in personal and advertising injury coverage.

The comprehensive liability covers you for all risks, including swimming pools and hot tubs, and provides coverage for things like animal liability, liquor liability, invasion of privacy suits, and more.

Contents

The contents portion of the policy provides replacement cost valuation at all all-risk level. This includes everything in the home, from furniture to artwork.

Coverage includes all damage or theft by a renter, with no limits on theft. There is no limit to the level of coverage that can be purchased for contents.

Business Income

This coverage is similar to the loss of rent coverage you would find in a landlord’s policy. It pays out on the actual loss amount based on revenue.

There is no coverage limit for business income, and it is again covered on an all perils basis. There is also no time limit on this coverage, so you can recoup lost income for as long as it takes to make the home rentable again.

How are the company’s rates?

Proper does offer online quoting for property insurance, which is unusual for this type of insurance company. Because short-term rentals vary so widely in terms of size, value, rental cost, and liability risks, it would be difficult to compare quotes on a vacation property.

We went through the quoting system as a test and found it relatively straightforward and simple. Our quote for a 3-bedroom, 1500 square foot, single-family residence in Los Angeles came out to $1,612.91 a year. Of course, this is only comparable to a home of the same size, of the same value, and in the same zip code, but it seems reasonable and not at all out of line. Looking at the California home insurance guide gives you a point of comparison.

Proper offers a very specialized and unusual sort of policy, which means there really aren’t any competitors to which we can compare this policy. When obtaining quotes, it is important to remember that the rates are not comparable to a regular home insurance policy, even if a short-term rental endorsement is available. The coverage is simply too different to compare.

How are claims processed?

Claims are paid by the underwriting company, Lloyd’s of London. We were unable to find any claims filing information on the website, which appeared to have some technical difficulties during our visit (we received repeated error messages when attempting to follow links on the page).

There is a toll-free number offered on the page through which we assume a customer can be pointed in the right direction to file a claim. An email address is also listed; again, this is a general information contact and not claims directly.

Are ratings and consumer reviews positive?

Proper Insurance has an A+ rating with the Better Business Bureau (BBB), with only one complaint on file in the past three years. Reviews can give you insight into how the company operates and give you peace of mind about your property management.

The reviews left on the BBB page have a 93% positive rating. There are 12 reviews on the company’s Facebook page and all of them are 5-star. The reviews are mixed between actual customers and insurance agents that work with Proper. Customer service reviews cite excellent claims experience, helpful staff, and solid coverage.

Proper has an overall 4-star rating on Yelp based on nine reviews. There are a couple of negative reviews, mainly regarding denied claims. Proper responds to all reviews, which is a positive thing from any insurance company.

Overall, this company has a very good reputation. They are amongst the best insurance companies on the market.

Why do you need special vacation rental insurance for your property?

Most vacation rental owners carry either a homeowner or landlord insurance policy, both of which have significant coverage gaps. Homeowner insurance is designed for an owner-occupied property, while a landlord policy is designed to be tenant-occupied.

Vacation rentals are different. They typically have three uses throughout the year: rental guest stays, owner’s vacations, and periods of being unoccupied. You require a vacation rental insurance policy that can cover all three.

Why is Short-Term Rental Insurance important?

Claims for short-term rentals are often denied by homeowner‘s insurance policies because vacation rentals function as a business. Most homeowners policies carry a “business activity exclusion”. A short-term rental insurance policy provides coverage for the building(s), contents, business liability, and income that the rental generates. This policy is designed to replace your current homeowners or landlord insurance policy.

What’s the bottom line?

If you have any sort of short-term vacation rental situation, Proper is well worth a closer look. Although other insurers are moving to help provide some coverage, Proper offers the most comprehensive and specific coverage for vacation rentals we have seen anywhere. With the backing of Lloyd’s of London and plenty of happy customers, they appear to be a solid bet.

By having the proper vacation rental insurance, you’re not only taking the necessary steps to mitigate financial risk, but you’ll give yourself peace of mind during the busy vacation season.