Jason decided to skip town for the long weekend to escape the hustle & bustle, and put his house up on AirBnb. He went around the bay visiting family, and obviously had to indulge in Grandma's flipper pie. What he didn't expect was for his house to get flipped in the meantime. Jason arrived home on Sunday evening to find his watch and laptop were missing, and his furniture was torn apart. Break & Enter? Think again. The culprit... his Airbnb guest.
Recently, we've seen Newfoundlanders jump in on the action to rent out their homes on a short-term basis to people on Airbnb & HomeAway. Similar to how a Bed & Breakfast operates, these sites let you rent a room or home to prospective renters so you can earn a little extra dough on the side.
Already, there are over 400+ Airbnb & HomeAway listings across the island, but what's scary is that most of these hosts (if not all) do not carry the right kind of insurance to protect themselves against claims involving their guests.
When our Personal Account Executive, Dayna Hafey isn't busy shuttling her daughters around town for soccer matches, the avid soccer mom is always on the lookout for more ways to protect our clients from the unexpected. Dayna dives deeper into more details about home sharing and insurance
So what kind of insurance do you need to protect your home when renting it out? Many think that personal liability coverage through their home and tenant's insurance will cover possible damage caused by the renter. Others have false security with AirBnb or HomeAway's coverage and don't think twice about what could really happen if their property was damaged by a guest.
We've put together a list of things you should think about before you post your listing online.
1 : Check Your Home or Tenants Insurance Policy
First things first, if you decide to rent out your home you need to let your insurance provider know. It doesn't matter if it is one time or 50 times. Your home or tenant's coverage is not for business, and renting out your place for a short period of time is considered a business activity.
Airbnb & HomeAway operate much like a Bed & Breakfast or hotel, so any claims involving a business activity have a huge possibility of getting denied.
2 : Be Aware of The Risks
There is no doubt that these sites are a great way to make come extra cash on the side, but you should be aware of all the risks before opening your door to strangers. For example, there have been instances of AirBnb guests throwing parties (like this one), injuring themselves, involving theft, and even damaging neighboring properties. You should address these issues before you consider renting out your home.
3 : Review AirBnb & HomeAway's Coverage
Airbnb does offer Host Guarantee Coverage that provides protection for up to $1 million in damages. However, what concerns us is that the coverage is not insurance and should not be considered a replacement for your home or tenants insurance. Plus the coverage does have limited protection for things like jewellery, collectibles, and artwork. So play it safe and remove any valuables from your home before renting it out to guests.
Recently, Airbnb introduced Host Protection Insurance that provides primary liability coverage for up to $1 million per occurrence in the event of third party claims of bodily injury or property damage. This new protection can now serve as your primary coverage for claims filed as a result of Airbnb stays.
Again, this does sound dandy and sweet, but it shouldn't stop you from letting your insurance provider know as they will help make sure you are covered if anything goes wrong during an Airbnb stay.
Before You Check Out
If you have decided to rent out your space, consider the following before you accept your bookings
At the end of the day, it's up to you decide if you are comfortable with renting out your property. Be proactive and speak to your insurance provider to see if your current policy keeps you covered, or what options are available to you. We'll do everything possible to protect you and your home for the unexpected.
Until next time on the Wedgwood Life Series,