Airbnb: Why your home insurance coverage may not be enough
It’s become increasingly common for homeowners to rent out their houses or condos for short periods of time (usually, 30 days or less) through short-term leasing websites, like Airbnb.
San Francisco-based Airbnb is an online marketplace that links travelers with rental opportunities. The company says it operates in 190 countries and has 800,000 rental listings worldwide.
To entice homeowners to participate in “home sharing” services and give them “peace of mind,” Airbnb offers its users a free “host guarantee.”
Airbnb asserts this is not an insurance policy, and isn’t meant to take the place of homeowners or renters insurance.
However, the guarantee provides protection for up to $1 million in compensation, if guests cause damage. But as you might’ve guessed, the guarantee has a number of exclusions.
Things that aren’t covered include:
- Cash and securities, such as stocks and bonds
- Rare artwork
- Jewelry
- Pets
- Your personal liability
To make sure you’re fully protected, Airbnb recommends you contact your insurance provider.
Though it might appear as a fast and easy way for you to make money, if you don’t have the proper insurance, you’re taking a huge financial risk.
It’s important to be aware of the issues associated with short-term rentals (such as liability for any injuries to any guests staying at your home, and coverage for property damage, or loss.)
Here are some key insurance questions to consider when participating in short-term rental websites:
Does my homeowners or renters insurance policy cover short-term leases?
Possibly – your insurance policy may provide some protection when you’re renting your home on a short-term basis.
Homeowners insurance: Before renting your home to anyone, you should read your policy carefully as policies vary from insurer to insurer. Depending on how often you rent out your home, your insurer could claim you’re running a hotel or bed and breakfast business and deny coverage. Contact your insurance agent to get clarification.
Renters insurance: Much like homeowners insurance,renters insurance is subject to the same limitations. It primarily provides coverage for tenants who have occasional guests, but not for those in the business of renting out their apartments to paying guests. Ask your agent for specifications.
Who Pays for Property Damage Caused by Short-Term Renters?
Dependent on your individual policy, you may or may not be reimbursed by your insurer.
As we mentioned above, Airbnb has a “host guarantee,” which they promise to pay up to $1 million dollars for property damage. However, Airbnb makes it clear on their website it’s “not insurance.”
Who’s Liable for Renter Injuries?
On Airbnb’s website terms and conditions it states, “Airbnb is not responsible for and disclaims any and all liability related to any and all listings and accommodations.”
So, if there’s a problem, you’re on your own…and it’s extremely expensive to cover costs such as legal settlements and any associated court fees.
Bottom line: make sure you’re well prepared and aware of the different situations that could happen while participating in “home sharing” services.
If you’re interested in finding out more information about homeowners insurance and renters insurance in Florida, contact the Pettineo Insurance Agency.
We’re located in South Florida and have been serving clients through out the state for the past 30 years.
Visit our website at www.pettineo.com or give us a call at 954-493-9424 to get in contact with one of our agents.
Pettineo Insurance Agency Inc. provides homeowners insurance and renters insurance in Fort Lauderdale, Lauderdale-By-The-Sea, North Lauderdale, Pompano Beach, Oakland Park, Boca Raton, Deerfield Beach, Hollywood, Sunrise, Coral Springs, Pembroke Pines, Sunrise, Tamarac, Plantation, Lighthouse Point and all of Florida.
