The STL Insurance Market in H2 2026: Fewer Insurers, Harder Terms, and What to Look For at Renewal

In short: The insurance market for short-term let operators has hardened. Some specialist insurers have withdrawn, premiums are up, and exclusions have quietly widened. Operators renewing this year should read the policy schedule carefully - not just the summary.

The insurance market for short-term let operators is a market STL Solutions does not itself operate in - we are planning and legal consultants, not brokers. What we do see, though, are the downstream consequences when a client's cover turns out to be inadequate. Those consequences have become more common, and more expensive, through 2026.

What has changed

Three shifts define the current market:

1. Fewer specialist insurers. Two of the specialist STL underwriters active in 2024 have either withdrawn or narrowed their appetite to the point of effective withdrawal. That has pushed volume onto the remaining specialists and onto standard household insurers offering an STL endorsement, which is not the same thing. 2. Higher premiums. Renewals we have seen quoted in H2 2026 have typically come back 20-40% above the equivalent 2024 premium, with larger uplifts on multi-unit portfolios and on properties in areas the underwriter has flagged as high enforcement risk. 3. Wider exclusions. The most consequential change is not the premium but the small print. Exclusions we have seen introduced or extended include: cover being void where the property does not hold a current STL licence (Scotland) or is not registered (Wales and shortly England); loss of rent cover excluded where the loss arises from local authority enforcement action; and public liability excluding claims arising from any use the underwriter deems unlawful.

Why this matters

Two of those exclusions bite hardest.

Where cover is void without a current licence or registration, an operator who is mid-application - a common situation given the delays many councils are running - can find themselves technically without cover on a live property. That is a serious position to be in and one that operators cannot always mitigate quickly.

Where the loss of rent cover excludes losses arising from enforcement action, an operator served with an Enforcement Notice who has to cease operating is left carrying the cost of the forced closure alone. That was the exact exposure a number of Scottish operators discovered they had in 2025 when Edinburgh's enforcement programme accelerated.

What to look for at renewal

We are not brokers and we do not recommend specific products. What we do suggest is that operators, at renewal, put five direct questions to their broker or insurer:

1. Is the cover void if the licence or registration lapses, is refused, or is pending? 2. Does the loss of rent cover respond to a forced closure arising from planning enforcement action? 3. Does the public liability cover respond to claims arising from a use the insurer subsequently deems unlawful? 4. Is any exclusion applied on the basis of the property being in a designated control area, Article 4 area, or similar? 5. Where a Certificate of Lawfulness is held, is the underwriter prepared to note that on the policy schedule?

Answers to those questions will tell an operator whether the cover they are paying for is the cover they think they are paying for.

The planning connection

Where a Certificate of Lawfulness is held for the use, the answers to several of the questions above become materially easier. A Certificate is durable, is not lost on lapse of a licence, and represents an authoritative finding that the use is lawful - which cuts through most of the "unlawful use" exclusions insurers now write.

This is not the only reason to hold a Certificate. It is, however, one of the less-discussed reasons and one that becomes more relevant as the insurance market hardens.

Book a free consultation or start a Certificate of Lawfulness application.

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Ross Armstrong Head of Professional Services, STL Solutions