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I’ve been going back and forth for a while now on whether I should feel comfortable renting through Airbnb, keeping my homeowner’s policy as-is (without short-term rental coverage) and just relying on the Airbnb Guarantee for property damage and the Airbnb Liability Coverage for a guest’s personal injury. I’ve looked through the Airbnb guarantee and liability coverage and they seem pretty good. Sure, there are caveats and concerns, like you have to file a police report in connection with property damage. And for personal liability, there seems to be an open question as to whether you will have to exhaustively harass the insurance company for your normal homeowner’s policy until Airbnb will finally step in and cover the liability.
Aside from relying on Airbnb, there’s always the option of spending extra money to get a special business liability policy that specifically allows short-term rental. That’s the safest way to go, but there’s the added expense.
With all that said, how have you thought this through when you’ve been considering potential liability associated with short-term rentals? What have you ultimately decided to do? Rely on Airbnb? Buy new short-term rental insurance?
Well not always. Guests damaged my breakfast table once and I had to go through Resolution, give a full report, upload photos of the damage and find something comparable online to give an idea of value. Police report not necessary.
I don’t know about the liability policy. I would hope you don’t have to go through your homeowner policy first. That would moot the whole point of having liability coverage available.
There have been reports on the forums for certain other listing sites of homeowners’ policies dropping clients if they catch wind of the commercial aspect of the letting.
I’m pretty sure if you use your home for commercial purposes, a loss won’t be covered - and it could be a loss NOT caused by an airbnb guest - but your ho could still be void. USAA was great at working with me until we could replace our regular HO with a business policy.
In the typical kind of case where you might need Airbnb to cover something it’s very likely that they won’t.
We had a situation recently where one of our guests basically destroyed our microwave by putting some metal into it. We reported it to Airbnb who then asked the guest about it (all before the deadline for leaving a review had expired). The guest denied it and said they absolutely didn’t do it! So Airbnb told us in light of the fact that the guest wouldn’t admit fault, there was nothing they could do!
So in essence, in a lot of cases, in probably the most common types of cases, you won’t be covered at all unless your guest decides to fess up.
Oh and the reason Airbnb runs this by the guest is because if the guest does admit to it, Airbnb will force the guest to pay for it! So if the guest decides they’d rather not, all they have to do is deny they did it.
In our case there were two separate guests staying here at the same time. We knew which one it was because they were the only ones who used the kitchen. But they told Airbnb it must have been the other guests. Then they promptly wrote us a scathing review. And we’re still out $300 for the new microwave.
This is one of those cases where you simply must inquire of the guest before opening a case with Air. A simple message through the site’s messenger, or a text message will do. “Hey, do you know what happened to the microwave?” Chances are much greater that they are going to respond with useful information to this than if the question is coming from one of the trip managers.
They are quite easy to work with. You are right about that voiding of the policy by any commercial use of the home. I think a lot of people ask their agent if the policy is OK if they rent out a room, basement, etc. The agent is thinking long-term rental, so they respond in the affirmative. So, it’s important to be clear about what you’re doing. The change in premiums is not usually tremendously significant. Also, the proper plans will have an appropriate amount of injury liability coverage.
Do yourself a favor on this one. Call tomorrow. The last thing you need is for someone to slip and get hurt and sue you, and when you are expecting the insurer to go to bat for you, you receive a notice that the short term letting voided your policy.
Insurance really should be right up there with the tax and licensing considerations we are told to make. Even with the supposed liability insurance provided through the site, you don’t want to find yourself in a situation with a voided homeowner’s policy. Your mortgage provider will not take kindly to that.
Does USAA offer a short term rental commercial policy? Anyone else know of any other good insurer plans that cover short term rental when the owner is staying in part of the house and guests are staying in a separate, private part of the house? I’ve looked into CBIZ (underwritten by Tudor Insurance) and Proper Insurance (underwritten by Lloyds of London). Would love to know if there are other attractive options.
I’ll give them a call today. They are familiar with AirBnB?
I’d heard stories on here of insurance companies dropping their clients for even mentioning Air, so I’d been afraid to ask. I haven’t seen anyone post the name of a US company that is AirBnB friendly until this thread. I’m lucky it happens to be my insurance provider.
You could always approach the subject as an outsider. Don’t mention your current policy with them. Make the appropriate inquiries and when you get the needed information, tell them you’d like to switch from your current plan to the appropriate one that was described. If they say they don’t provide that sort of coverage, then you can go and quickly find a provider that does.
It’s better to find out now that they don’t cover you in such an arrangement than when a guest slips on a wet stair and decides they’d like a couple million dollars for their pain and suffering.
I just got off the phone with USAA, and as usual they were very friendly and helpful. They said for renting one room in my home on AirBnB, I don’t need any additional coverage, but they recommended upping my personal liabilities coverage, as a guest in your home can sue if injured. I was surprised they didn’t consider it a business activity, but it may be because I am just renting one bedroom rather than a whole apartment.
It sounds like you didn’t have the chance to take it to the Resolution Center, which has to be within 48 hours, not the review time period. Had you found and documented the damage sooner, Air probably would have sided with you.
In the case of the table, I had good proof of the damages and uploaded all to Air within the requisite 48-hour period. The guest, being the little party brat that she was, denied breaking the table. Air sided with me and paid for the table, which was $300. The guest deposit was $150. I have no idea whether they dinged her deposit and forked over the other $150 themselves. Why wouldn’t they take her deposit money and then pay out whatever the balance was?
Well I just got the OPPOSITE response from USAA. They said in no way, shape or form would they cover AirBnB activities! Are you sure you told them it was AirBnB? Because I’m basically doing the same thing you are doing. Renting a room in my house. I told them it was Air and they said NO WAY.
Well, I’ll be danged!!! They told me something different last summer, but let me keep my coverage until my renewal date. I then cancelled my HO and replaced it with a business policy… Hmph. If you could pm me with the reps name, I’d appreciate it.
Yes, last summer when I was discussing this with them, they took a lot of information and an underwriter called me later and discussed it at length. It seems that, perhaps since then, they’ve reversed their decision.
I do have two bedrooms now, but didn’t at the time; however, I rent them out to only one group at a time.
Keep us posted! They can’t help me anyway because I am in a place in Hawaii that they don’t cover. T o give the quote, they wanted my current insurer, which I refused to give! Who knows if your stuff is shared on some mutual network, and maybe one company will rat you out to another! ??
I never admitted to doing AirBnb, and just said I was “thinking about it” but I think they did ask me “how many” guests I would be renting to and I said, oh maybe 12. Of course it is more than that, but they immediately gave me the thumbs down! We can’t cover you with a policy at all! Yikes!
