What best describes your situation?
A homeowners policy excludes rental use and a short-term rental policy is written for stays under 30 nights. What sits in the gap, and why your manager should be an additional insured.
You need a landlord policy, usually a dwelling fire policy, written to cover a non-owner-occupied home that is furnished and occupied by paying guests on stays of 30 days or longer. A standard homeowners policy does not cover it, and a short-term rental endorsement is written for a different occupancy than yours. If a management company operates the home, that company should be added to the policy as an additional insured.
This article explains what each of those pieces does, where the coverage gaps sit, and what Texas Corporate Homes requires before we take a property. We are a property manager, not an insurance agent. Nothing here is a coverage opinion on your policy, and every point below should be confirmed with your own carrier.
Texas does not require landlord insurance by statute. Two other parties usually require it anyway. A mortgage lender will require coverage as a condition of the loan, and a property manager will require it as a condition of the management agreement. In practice that makes it mandatory for almost every owner who is not holding the property free and clear and self-managing.
The more useful question is not whether you are required to carry coverage but whether the coverage you already carry responds to the way the home is now being used.
| Policy type | Written for | Where it fails a furnished midterm rental |
|---|---|---|
| Homeowners (HO-3) | An owner living in the home | Rental use is generally excluded. A claim can be denied on that basis alone. |
| Landlord / dwelling fire (DP-1, DP-2, DP-3) | A non-owner-occupied rental with long-term tenants | Assumes an unfurnished home and a twelve-month lease. Contents and short-occupancy turnover need to be addressed by endorsement. |
| Short-term rental policy or endorsement | Nightly and weekly stays | Written around occupancy under 30 nights. Yours is longer, which can put you outside the product rather than inside it. |
| Landlord policy with furnished midterm endorsements | Furnished 30 to 180 day stays | This is the one to ask for. Availability varies by carrier. |
As a principle: an insurance product is priced against an assumed occupancy pattern. When your actual pattern differs from the assumed one, the gap does not appear until a claim is filed.
Ask your agent about each of these specifically. A policy that is silent on one of them is not a policy that includes it.
Dwelling. The structure itself, at replacement cost rather than actual cash value where you can get it. Actual cash value pays depreciated value and can leave a large gap on a roof.
Personal property or contents, owned by the landlord. This is the furniture. An owner in our program typically funds $20,000 or more of furnishings, and a landlord policy written for an unfurnished house will not cover it by default.
Liability. Our management agreement requires $500,000 in liability coverage plus a $1,000,000 umbrella policy. That is a floor, not a recommendation for your circumstances.
Loss of rents, sometimes called fair rental value. If a covered loss makes the home uninhabitable, this coverage replaces the rental income during repairs. Owners skip it more often than any other line and notice its absence at the worst moment.
Water backup and, where relevant, flood. Flood is excluded from standard property policies and is written separately. Texas coastal and floodplain addresses need this evaluated at the address, not the neighborhood.
This is the part most owners have not thought about, and the terminology does real work here.
A named insured is a party the policy is written for, with an insurable interest in the property. That is you, and your lender's interest is usually reflected separately as a mortgagee. A manager is not a named insured, and should not ask to be.
An additional insured is a party extended liability coverage under your policy for claims arising out of the covered operation. That is the correct status for a property manager, and it is what our management agreement requires.
The reason is mechanical. When a guest is injured at the property and sues, the plaintiff typically names everyone with a connection to the home: the owner, the manager, and sometimes the vendor who last worked there. If the manager is an additional insured, one carrier defends the matter under one policy, with one defense counsel and one coordinated position. If the manager is not, two carriers each hire counsel, each investigates, and the two defenses can end up arguing with each other while the plaintiff watches.
As a principle: a divided defense is more expensive and less effective than a unified one, and the party paying for that inefficiency is usually the owner.
Most carriers add a manager as an additional insured at little or no cost. Some decline. It is worth asking before you bind a policy rather than after, because it is a standard request that a specialist carrier handles routinely and a generalist sometimes does not.
Additional insured status is not a transfer of responsibility to us. Our management agreement holds each party accountable for its own conduct, and the endorsement extends defense and liability coverage rather than reassigning fault. Any owner reading that paragraph as "the manager is now covering my risk" has read it wrong. Read the endorsement, and ask your agent what it excludes.
| Requirement | Detail |
|---|---|
| Dwelling and fire coverage | In force on the property |
| Liability coverage | $500,000 minimum |
| Umbrella policy | $1,000,000 minimum |
| Additional insured | Texas Corporate Homes added to both policies |
| Proof of insurance | Submitted before the management agreement is executed |
We ask for proof before signing rather than after because an uninsured week is not a risk either party should carry while paperwork moves.
We do not quote insurance and will not publish premium figures we cannot stand behind. What we can tell you is which variables the quote turns on, so the conversation with your agent is a short one.
Insurance responds to losses. Operations decide how many losses there are and how well documented they are when they happen.
We run a 400+ photo inspection after every checkout and classify any damage within one to four days. That does two things for an owner. It attributes damage to a specific stay while attribution is still possible, and it produces a documented condition record if a claim is ever filed. Damage discovered months later is damage nobody can assign to anyone.
Occupancy type matters too. Roughly 80% of our bookings come from insurance placements via insurance housing companies, which means the guest is a household displaced from their own home and the agreement is signed by an institution. Our eviction rate stays under 0.5%, against 5% to 10% on traditional long-term rentals.
We are a property manager and we are describing insurance products we do not sell. Carrier appetite for furnished midterm occupancy varies, changes, and is not uniform across Texas. An agent who writes this occupancy type regularly will know more about current availability than we do.
We also cannot tell you whether your existing policy responds to your situation. That requires reading your policy, which is a job for your agent.
Generally no. Homeowners policies are written for owner-occupied homes and rental use is typically excluded. Tell your carrier the home is now a rental. A denied claim is a far worse outcome than a repriced policy.
Our rental agreements require guests to carry insurance covering their own personal property and liability, and to name the host and owner as additional insureds. Their policy does not cover your building.
Not usually. Landlord policies are built around an unfurnished dwelling. Landlord-owned contents typically require a specific coverage limit, and the limit should reflect what you actually spent.
Ordinary wear is an operating cost. Damage beyond that is classified within one to four days of checkout and pursued against the responsible party, which in an insurance placement is typically the placing company rather than the individual. Large losses go to your policy like any other claim.
It generally does. Texas hotel occupancy tax is written around stays under 30 days. We cover the structure in midterm rentals and Texas occupancy taxes.
No. The $1,000,000 umbrella is a requirement in our management agreement rather than a preference, and it protects both sides.
Texas Corporate Homes manages 150+ premium furnished single-family homes across DFW, Houston, Austin, and San Antonio. We have been operating since 2015 and managing properties for outside owners since 2019.
If you are evaluating whether your home fits the midterm model, start with what owners can expect, or email leasing@staytch.com. Bring your current declarations page to that conversation and we will tell you what is missing.
