Las Cruces, NM Short-Term Rentals: Insurance Requirements (2026)
Key Facts
- Minimum liability coverage
- $500,000
- Proof required
- At registration, on change, on request
- First-offense fine
- $50 to $300
- Repeat-offense fine
- $300 to $500
- Enforcement start date
- July 1, 2026
Summary
Las Cruces requires every short-term rental operator to carry at least $500,000 in property and liability insurance before the city will register the unit. Proof of adequate insurance must be filed with the community development department at registration, whenever coverage changes, and on city request.
Adequate insurance means property and liability insurance to cover damage or loss to the short-term rental unit and contents within the dwelling with a minimum of $500,000.00 liability insurance. Adequate insurance shall be in the form of a traditional homeowner's policy with a specific rider for the short-term rental property, a dwelling policy with proper endorsements for short-term rental, or a landlord's policy. A policy provided by a short-term rental property marketing company may be acceptable if adequate insurance limits are met. ... The short-term rental operator must maintain adequate insurance for the short-term rental. Proof of insurance shall be required at the time of registration of the property with the community development department, when there is a material change in the scope or amount of coverage, and at any other time upon request by the City of Las Cruces.
Official source re-checked September 7, 2026: no newer edition of the code had been published (publisher’s edition: Code of Ordinances: Supplement 33 | Land Development Code: Supplement 28).
Full Breakdown
Sec. 00 limit. Sec. 16-508(e) makes maintaining that adequate insurance an ongoing condition of operating: the operator must submit proof of insurance when first registering the property with the community development department, again whenever there is a material change in the scope or amount of coverage, and at any other time the city requests it. The insurance requirement sits alongside the ordinance's other operating conditions, including the certificate of business registration under Sec. 16-508(a), smoke detector and fire-safety compliance under Sec. 16-508(g), an occupancy cap of two people per bed plus two per unit under Sec.
16-508(h), and the requirement to pay lodgers' tax, gross receipts tax and provide a state tax ID under Sec. 16-508(k). The ordinance, adopted by Ord. No. 3103 on December 15, 2025, took effect January 1, 2026, with enforcement beginning July 1, 2026.
Violations & Fines
Operating a short-term rental without adequate insurance, or without producing proof of coverage when the city asks, is an 'offense' under Sec. 16-507 and Sec. 16-509. A first offense carries a civil fine of $50.00 to $300.00; a second or later offense carries a fine of $300.00 to $500.00. The city can also seek a finding of continuing noncompliance, and a fifth offense within three years makes revocation of the business registration mandatory under Sec. 16-509(c)(3).
Frequently Asked Questions
How much insurance does a Las Cruces short-term rental need?
When does a Las Cruces short-term rental host have to prove they have insurance?
What happens if a short-term rental operator lets their insurance lapse?
Sources & Official References
Other rules in Las Cruces
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