What Is Contents and Furnishings Insurance?
Contents coverage pays to repair or replace personal property at the rental — furniture, electronics, kitchenware, linens, decor, and the dozens of smaller items that make a short-term rental a hosting business rather than an empty structure. It responds to the same covered perils as your property policy (fire, wind, hail, theft, vandalism, smoke), with its own limit and deductible separate from the dwelling. The Insurance Information Institute consistently notes that "personal property" coverage on a homeowners policy was designed for owner-occupied use — STR contents look very different.
For properties listed on Airbnb or VRBO, the contents are the rental-business product. A fully-furnished six-bedroom beach house carries $80K–$200K in actual replacement cost — well above the 50%-of-dwelling default many residential policies use. The mismatch shows up at claim time, when a host with $400K of dwelling and a $200K contents allowance discovers actual replacement cost at $300K or more.
Tax treatment reinforces the documentation discipline. The IRS treats rental property income and expenses as a business activity — see IRS Topic 414: Rental Income and Expenses for the framework — meaning the inventory you maintain for tax purposes (photos, receipts, depreciation schedule) doubles as the documentation a carrier will request at claim time.
Why a Standard 50% Contents Limit Falls Short on a Fully-Furnished STR
The 50%-of-dwelling default came from owner-occupied homeowners coverage, where personal belongings — clothes, kitchenware for one household, family electronics — track loosely with dwelling value. An STR's contents profile is different. A six-bedroom Airbnb listing carries beds and seating for 12–14 guests, full kitchen equipment that turns over with wear, multiple TVs and smart-home hubs, decor refreshed seasonally, and consumables you replenish between guests.
Concrete example: a $500K coastal beach house with full furnishings — beds, sectionals, dining tables, fully-equipped kitchen, home theater, hot tub, smart-home tech, exterior furniture, decor — typically carries $120K–$180K in real contents replacement cost. The standard 50% allowance ($250K on this property) may be enough, but only if you've actually inventoried and the carrier sized the limit deliberately. The default math leaves many STR owners under-insured at claim time.
What to do: inventory the property in writing (room-by-room, with photos and receipts where available), confirm the policy uses replacement cost not actual cash value, and consider an STR-specific endorsement increasing contents to 75% of dwelling for fully-furnished properties. For specialty items above the unscheduled limit — art, instruments, high-end appliances, jewelry left on premises — schedule them with an inland marine endorsement.
