Does your Home Insurance cover the Holiday Rental?

by PBF Seguros | Sep 15, 2020 | Blog, Home Insurance

Do you have everything in order, do you comply with all the regulations?

In case you decide to rent out your property as a holiday rental, it is important to know that you must comply with some legal and tax rules as well as ensure that your home insurance covers the use of holiday rentals.

Register your property with the regional tourism authority: The first thing will be to obtain the holiday rental license from the local authorities of the island where the property is located. Once you have obtained the license, you can place your VV sign outside your property to show that you fulfil all requirements.
Submit tax statements: property owners in Spain are obliged to pay taxes regardless of whether they are or aren´t residents for tax purposes in Spain. On the one hand, you will have to register IGIC (Canary Islands) at the canary tax authority and the revenue and expense must be declared in the annual IRPF statement.
Registration of holiday-makers with the local Spanish police: There is an obligation to register each traveller who is staying in your holiday home with the local police. To facilitate this communication there are Apps available from where you can process this procedure.

In addition, to ensure that your rentals are 100% legal, we recommend you to contact a specialized consultant, such as LAJARES LAW OFFICES (www.lajareslawoffices.com).

And DON’T forget your Holiday Home Insurance

If you are the owner of one or more properties designated as holiday rental, you must ensure that your insurance covers this specific use of your property and that in case of a claim for damages suffered by tenants, the insurance covers civil liability to protect the owner.

Many insurers have already adapted their home insurance and have included this use as one of the options, but beware there are other areas that are also important such as customer property theft and vandalism.

We could also tell you more about the insurance of civil liability especially designed for enterprises dedicated to exploiting and managing holiday housing, also of a travel assistance insurance for tenants, but this would be explained in another article in this Blog.