Why Standard Home Insurance Won’t Cover Your Short-Let

One of the most common and costly mistakes Malta short-let owners make is assuming their existing home insurance policy covers guest damage, liability claims, or revenue loss. It almost never does. Standard residential insurance is underwritten on the basis of owner-occupancy — the moment you rent to paying guests, you’ve changed the risk profile of the property in ways that most home insurance policies explicitly exclude.

The MTA Insurance Requirement

Malta’s MTA Holiday Furnished Premises Licence requires applicants to hold a minimum of €250,000 third-party liability insurance covering the property’s use as tourist accommodation. This is a legal prerequisite — not optional.

The specific wording matters: the policy must cover the property in its capacity as tourist accommodation, not just general residential liability. A standard home insurance policy with a €250,000 liability clause may not satisfy this requirement if it excludes commercial or rental use.

What Short-Let Insurance Needs to Cover

Third-Party Liability (mandatory)

Covers claims from guests or third parties injured on the property during a stay. Minimum €250,000 as required by MTA; €500,000–€1,000,000 recommended for adequate protection.

Contents and Furnishings

Covers accidental damage to furniture, appliances, and fixtures caused by guests. Standard policies cover fire and theft but may exclude accidental damage — confirm this is explicitly included.

Building Insurance

Covers structural damage to the property. If you own an apartment in a block, confirm whether the condominium building insurance extends to short-let use, or whether you need your own supplementary policy.

Lost Revenue (Optional but Recommended)

Covers income lost when the property is uninhabitable due to an insured event (fire, flood, major damage). For a property earning €2,000/month, even a 2-month forced closure represents a €4,000 loss not covered by basic policies.

Does Airbnb Cover Me?

Airbnb offers AirCover for Hosts, which provides up to $3 million in damage protection and liability insurance for stays booked through its platform. This covers guest-caused damage and liability claims arising from Airbnb-sourced bookings.

However, AirCover has important limitations:

• It does not cover bookings made outside Airbnb (Booking.com, direct bookings)
• It does not satisfy the MTA’s third-party liability insurance requirement as a standalone policy
• Claims processes can be slow and outcomes are not guaranteed

AirCover is a useful supplementary layer — not a substitute for a proper short-let insurance policy.

Finding the Right Policy in Malta

Several Maltese insurers offer policies specifically designed for holiday let properties. When obtaining quotes, specify:

• The property’s intended use as tourist accommodation (MTA licensed)
• Expected annual number of guest nights
• Whether you require cover for bookings outside Airbnb
• Contents replacement value

A specialist short-let policy typically costs €400–€900/year for a standard apartment, depending on property value and coverage level.

How Eleva Supports Compliance

Eleva verifies that every property in its portfolio holds valid third-party liability insurance as part of the MTA licence application process. We work with owners to confirm that their policy wording satisfies MTA requirements and flag any gaps before application. For owners who need to obtain coverage, we can point you to insurers experienced with Malta’s short-let market.

Get in touch to discuss insurance requirements for your property.