Short-term rentals are everywhere in Oakville. From Bronte to Glen Abbey, more homeowners are opening their doors to guests for weekends, weddings, and seasonal stays. It can be a smart way to earn extra income, especially if you live near the lake, the GO train, or popular event venues. But when it comes to insurance, many hosts are caught off guard.
Standard home insurance often does not protect you when you rent out your property, even if it is just for a few nights. Without short-term rental insurance, you may be exposed to property damage, legal liability, or loss of income. And in Oakville, you are legally required to carry appropriate coverage in order to operate a short-term rental.
This guide explains what short-term rental insurance is, how it works, how much it costs, and why working with a local broker like James Inwood can help you stay protected and compliant.
What Is Short-Term Rental Insurance?
Short-term rental insurance is a specialized type of coverage that applies when you rent out part or all of your property for short stays. This could be a few days, a week, or even a month. It is often used by homeowners who list their property on Airbnb, VRBO, or other booking platforms. It is also relevant for anyone who rents out space independently.
Unlike regular home insurance, which is for owner-occupied or long-term rental properties, short-term rental insurance covers the unique risks of temporary guests. These risks include accidental damage, theft, legal liability if a guest is injured, and even income loss if the property becomes uninhabitable due to a claim.
Standard home insurance doesn’t cover short term rentals in most cases. It is meant to protect you while you live in your home or rent it out long-term. Once you start accepting paying guests for short stays, even just for a weekend, your home is being used for business purposes. Most policies exclude this kind of activity, which means damage caused by guests or liability claims related to a short-term rental likely won’t be covered. To stay protected, you need short-term rental insurance that specifically accounts for these risks.
Book a meeting with James today to discuss your options.
Who Needs Short-Term Rental Insurance in Oakville?
Anyone who accepts payment in exchange for a short-term stay should have this coverage. This includes occasional hosts as well as those who rent more frequently. It also applies to different types of properties, such as detached homes, townhouses, condos, and basement apartments.
Here is a real example. A homeowner in West Oakville listed her basement in-law suite on Airbnb during the summer. She had it cleaned and prepared for a three-night stay. The guests accidentally left the back door unlocked while they went out, and during that time, someone entered and caused damage to the kitchen and stole several small electronics. Her regular home insurance denied the claim because the property had been rented out for business use. Without short-term rental insurance, she had no coverage for the theft or the repairs.
This situation could happen anywhere. It does not matter how respectful the guests seem or how infrequent the rentals are. If money is exchanged and your insurer has not approved it, you are taking on personal financial risk.
Are Short-Term Rentals Legal in Oakville?
Short term rentals are legal in Oakville, but there are strict conditions.
The Town of Oakville passed a by-law in 2022 that requires anyone offering a short-term rental to be licensed. This applies to all areas of the town, including Bronte, Old Oakville, Central Oakville, and Glen Abbey. To qualify for a licence:
- You must live on the property full-time
- You may only rent out part of your principal residence, not a second home or investment property
- You need to submit a fire safety plan, parking layout, and proof of insurance
- The licence costs $240 per year and must be renewed annually
If you are operating a short-term rental without a licence, or you do not meet the eligibility rules, the Town can issue fines and prohibit further bookings. The full by-law can be found on the Town’s website, along with licensing details: Oakville Licensing Page
How Does Short-Term Rental Insurance Work?
This type of insurance may be purchased as a separate policy or added to an existing home or landlord policy. Coverage typically includes:
- Protection for accidental damage caused by guests
- Liability insurance in case a guest is injured on your property
- Theft and vandalism coverage specific to rental activity
- Loss of rental income if damage makes your property unavailable
- Coverage during guest stays booked through Airbnb or other platforms
Some policies also provide protection between bookings or offer continuous coverage year-round. If you host often or plan to expand your rental activity in the future, it is worth discussing these options with a broker who understands Oakville’s by-law and market.
What Is the Average Cost of Short-Term Rental Insurance in Oakville?
In Oakville, short-term rental insurance normally costs between $500 and $1,500 per year. The cost depends on several factors:
- The size and value of the property
- Whether you live on-site
- How often you rent out the space
- Whether the coverage is standalone or added to a homeowner policy
- The specific location (homes near downtown or the lake may cost more)
Many hosts are surprised to find that coverage is relatively affordable, especially when you consider the financial risk of going without it. Bundling can also reduce your total insurance cost. James often helps clients combine their short-term rental coverage with home, auto, or life insurance, which can lead to better rates and fewer gaps.
What Insurance Is Needed for an Airbnb in Oakville?
Airbnb offers a Host Guarantee and Host Protection Insurance, but these are not substitutes for proper coverage. These programs are not regulated insurance products, and they do not protect against every type of damage or loss. In many cases, they also exclude liability claims that go beyond Airbnb’s platform.
For Oakville hosts, this is not just a matter of preference. The Town requires licensed operators to carry adequate insurance, separate from what Airbnb provides.
The best insurance for short-term rentals is one that offers full property and liability protection, is recognized by local licensing authorities, and remains valid even if you accept bookings outside of Airbnb.
Are Student Rentals Considered Short-Term Rentals in Oakville?
Not usually. A student renting a room or unit for an academic term (e.g. 4 to 8 months) would typically fall under long-term rental housing, not short-term accommodation. Oakville’s Short-Term Accommodation Licensing By-law defines short-term rentals as stays of 30 consecutive days or less. So, if a student is signing a lease for a school semester or the full academic year, it would not require a short-term rental licence or short-term rental insurance.
What Are the Benefits of Short-Term Rental Insurance?
Aside from meeting legal requirements, this coverage gives homeowners several advantages:
- It allows you to rent your home with confidence, knowing your insurance company supports this use
- It protects against legal and financial risk from guest injuries or property damage
- It keeps you compliant with Oakville’s licensing program, helping you avoid fines or removal from rental platforms
- It may include income protection, so a serious claim does not eliminate future earnings
- It strengthens your overall risk protection by working alongside your home and auto policies
If you are relying on short-term rentals for income, or simply want to avoid legal issues, this type of insurance is essential.
Why Work With James Inwood?
James Inwood is an experienced insurance broker based right here in Oakville. His office is near Town Hall and just minutes from the Bronte Harbour. He has helped countless residents across West Oakville, Old Oakville, and Central Oakville find insurance that fits their lives, their homes, and their rental plans.
James does more than provide quotes. He reviews your current insurance setup, checks for gaps, and explains how short-term rental insurance fits into your overall coverage. He also helps you stay onside with Oakville’s by-law by making sure your policy meets the Town’s licensing standards.
If you also need home, auto, cottage, or life insurance, James can help you bundle everything under one provider. This reduces complexity and makes it easier to keep everything up to date.
If you are already hosting short-term guests or thinking about listing your home on Airbnb, this is the right time to make sure your insurance is in place. The licensing rules are active, and the financial risks are real.
Book an appointment with James today to review your options and get a quote. He will help you understand your coverage, stay compliant with the Town, and protect the home you’ve worked hard to build.
James Inwood is a member of Canadian Insurance Brokers Inc. CIBI operates across Canada with more than 40 licensed brokers and is completely independent so our advice is always objective. Representing 14 insurance carriers on the personal side and over 20 insurance providers on the commercial side helps give my clients clear choice and competitive pricing.
James Inwood, Insurance Broker
RIBO licensed | LinkedIn