I walked into my rental at 11 AM to find the drywall punched in, wine soaked into the hardwood, and my $3,000 custom sofa missing entirely. The guest had booked a “quiet getaway” for two people, but the Ring footage showed 45 people and a DJ setup; now, AirCover is asking for “original purchase receipts” for items I bought five years ago, and my personal insurer sent a cancellation notice for “unauthorized commercial activity.”
Key Takeaways
- The “Commercial” Denial: Standard homeowner policies will deny party damage claims immediately if they find out the damage occurred during a paid booking.
- AirCover’s “Depreciation” Game: AirCover rarely pays “Replacement Cost.” They pay “Actual Cash Value,” meaning they depreciate your 5-year-old sofa to $200.
- The 72-Hour Clock: You typically have strictly 72 hours (sometimes less) to report damage to Airbnb to be eligible for AirCover.
- Loss of Income: While the house is being repaired for 3 weeks, you lose revenue. Most standard policies won’t pay a dime of that.
The “Why” (The Trap)
The trap is the “Vandalism vs. Tenant Abuse” distinction.
Standard insurance policies exclude damage caused by “someone regularly residing at the property.” While a 2-day guest isn’t a resident, legacy insurers often group them into this exclusion to avoid paying.
Furthermore, AirCover uses AI claims adjusting in 2026. If you submit a claim for $30k, the algorithm immediately flags it for “fraud review” and demands an impossible paper trail: original receipts, police reports, and contractor quotes within 48 hours.
The Investigation: I Called Them
I tested the response to a hypothetical $30,000 “trashed house” claim.
- Airbnb AirCover: I analyzed recent user reports. The consensus: They are great for a $50 broken lamp, but for a $30k claim, they stall. They will demand you chase the guest for money first. If the guest declines (which they will), AirCover enters a “mediation” phase that can take months.
- Verdict: A safety net for small stuff, a nightmare for catastrophic damage.
- Proper Insurance: Their policy is built on “Special Form” coverage. They cover “intentional acts by a guest.” If a guest smashes a TV, it’s covered. They also pay “Replacement Cost” (new for old), not the depreciated value.
- Verdict: The only reliable option for major party damage.
- Allstate (HostAdvantage): The agent told me their endorsement increases coverage for belongings up to $10,000 per occurrence. For a $30k loss, I’d be paying $20k out of pocket.
- Verdict: Insufficient limits for a total thrashing.
Comparison Table: Party Damage Coverage
| Feature | AirCover | Proper Insurance | Standard Home + Endorsement |
| Intentional Damage by Guest | YES (Subject to review) | YES | NO (Usually excluded) |
| Valuation Method | Actual Cash Value (Depreciated) | Replacement Cost (New) | Actual Cash Value |
| Loss of Income | YES (Booking value) | YES (Actual Loss Sustained) | NO |
| Theft by Guest | YES | YES | NO (Voluntary Parting) |
| Deductible | $0 | $1,000 – $2,500 | $1,000+ |
[IMAGE: Split screen: Left side shows a smashed living room. Right side shows an insurance adjuster app with “Claim Denied: Commercial Use” notification]
Step-by-Step Action Plan
- File a Police Report Immediately: Do not wait. AirCover requires a police report for claims over a certain threshold (usually
300−300−500). Call the non-emergency line and get a case number. - Video Everything: Do not clean up yet. Walk through with a 4K camera (your phone) and document every inch of damage.
- Secure “Replacement Cost” Coverage: Check your Declarations page. If it says “ACV” (Actual Cash Value) for personal property, call your agent and upgrade to “Replacement Cost” immediately for future bookings.
- Get 2 Contractor Quotes: Don’t wait for the adjuster. Get local contractors to give you written estimates ASAP to fight the AI’s lowball offer.
FAQ
Will my homeowner’s insurance drop me after a party claim?
Yes. If you file a claim revealing you were running a short-term rental without a commercial policy, they will deny the claim and issue a non-renewal notice for “change in risk.”
Does AirCover pay for the deep cleaning smells (smoke/vomit)?
It’s hit or miss. They often pay for “extra cleaning fees,” but if you need an ozone machine treatment for smoke damage, you need to fight for it as “damage,” not just “cleaning.”
What if the guest cancels their credit card?
That’s AirCover’s problem, not yours—theoretically. However, AirCover often tries to make you exhaust all options with the guest first. Stand firm and demand the Host Damage Protection kicks in.