“Somebody Is Going to Sue You”: Dave Ramsey to Woman Who Rented Her Pool for 3 Years With No Real Insurance
Denise spent three years renting her backyard pool and collecting steady side income, convinced she had a million dollars of liability coverage behind her. Then Dave Ramsey heard her setup and told her exactly what scared him most.
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A woman named Denise recently called into The Ramsey Show after discovering that the liability coverage she relied on for renting her backyard pool as a side hustle for about three years might not be as strong as she believed.
Dave Ramsey delivered a strong warning: “The first thing that popped into my head was somebody is going to sue your butt. As soon as you told me this, that’s the first thing that ran into my head. It scared me.“
There are many ways she might not be covered if something goes wrong. If the coverage she thought was primary turns out to be secondary, and her homeowner’s policy has a business-use exclusion that voids the claim, she could be personally liable for medical and legal bills that could easily dwarf any side-hustle income she earned.
The $1 Million Policy May Not Protect You Like You Think
Renting out a pool, driveway, garage, or spare room is a business activity, and most standard homeowners policies don’t cover business activity on the property.
First, platform-provided liability coverage is often structured as excess coverage, sitting behind your own policy rather than in front of it. Denise learned that the $1 million liability coverage the app advertised pays only after her homeowner’s insurance pays first. If your homeowner’s carrier denies the claim under a business-use exclusion, there may be nothing for the platform’s policy to cover, and the plaintiff’s attorney could come looking for your assets.
Second, the business-use exclusion is common and enforceable. That is why Dave laid out the only clean fix: “The only way you could continue to do it is if you could just buy your own standalone liability insurance policy that paid from day one, from dollar one, and buy that from your local insurance broker. And it would not be attached to your homeowners.”
One Insurance Quote Destroyed the Economics of Her Side Hustle
If a pool rental grosses a couple thousand a season and the standalone policy costs several times a homeowner’s premium, as Denise found, it might not even be profitable to run the side hustle. Ramsey’s closing verdict: “You dodged a bullet. You dodged a bullet. Yeah. I’m not renting my pool.”
Denise’s reflection captured why many hosts miss this. “Up until this realization, I was so just feeling proud of myself because I was supplying this. Everybody, they’re just family. It wasn’t like they’re wild parties.” Even a well-behaved guest can slip, and any injury can trigger a lawsuit.
Key Takeaways
Dave Ramsey’s broader lesson is that any time you turn your home, car, or other personal property into an income-producing asset, make sure it’s properly insured. Otherwise, you could face a massive lawsuit if something goes wrong.
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Thomas Richmond is a financial writer and content strategist with 5+ years of experience covering stocks and financial markets. He has published over 500 articles focused on individual stock analysis, helping investors better understand business fundamentals, stock valuations, and long-term opportunities.
Thomas previously served as a Content Lead at TIKR, a stock research platform, where he helped scale the company’s blog to hundreds of articles per month and contributed to a weekly newsletter reaching more than 100,000 investors.
Outside of work, Thomas enjoys weight lifting and soccer.
