Tuscaloosa, AL Short-Term Rentals: Insurance Requirements (2026)

Tuscaloosa codifies its short-term rental insurance mandate in Sec. 7-203 of the Municipal Code. Any person wishing to obtain a license for short-term rentals must provide proof of insurance that includes either a rider that expressly covers short-term rentals, or a commercial insurance policy at the permitted address, in either case with minimum liability coverage of one million dollars ($1,000,000). The required insurance must name the City, its officers, and employees as an additional interested party, and the policy must provide that it will not terminate or be cancelled before the end of the permit period without 45 days' written notice to the City at the address shown in the permit agreement. The City's official short-term rental page restates this by instructing applicants to list the City of Tuscaloosa as an 'additional interested party' on their policy. A current insurance policy meeting these ordinance criteria must be supplied not only at initial licensing but also at every annual renewal. This insurance requirement sits alongside the City's home-inspection, building- and fire-code, and lodging-tax obligations as a core precondition to operating a short-term rental in Tuscaloosa.