Renting your room or house out on a short-term basis can reap rewards financially but it can also come with risks if you don’t have the right insurance cover. Unlike websites like Homestay and Wimdo, Airbnb protects its customers with its host protection and guarantee. But is this cover enough for you, if something bad happens? Here are some things to consider before advertising your home online.
The Airbnb host protection and guarantee is not an insurance contract.
This is stated clearly in its terms and conditions and is the first thing you should consider before renting out your home. The implications of this are that Airbnb may not cover any damage incurred as a result of hosting or guest activity. Inlet offers a specialist insurance policy that guarantees you peace of mind. Taking out insurance with us not only gives you an insurance contract, we’re regulated by the FCA in case anything goes wrong.
There is no guarantee they will cover your claim.
If a dispute with a guest arises, Airbnb require the Host to contact the Guest and try and resolve the matter first. Whilst this may be sufficient for trivial matters, this may not be appropriate where issues such as personal injury or criminal activity are involved and specialist help is needed. In addition to this, any claims are at Airbnb’s discretion if they think arbitration should continue. Should a host win, Airbnb requires you to seek recovery of damages against the guest. With Inlet you aren’t required to go through any arbitration process and we will pay out if you have a valid reason to claim.
The Host guarantee damage protection limit is worldwide only.
Airbnb states on their website that they will reimburse eligible hosts if any damages occur for up to £600,000. The catch? This limit is the total guaranteed pot that covers all Airbnb hosts worldwide. With thousands of properties listed on its website all over the world, there is a strong possibility that this pot will not be enough to cover any serious damages to your property. With Inlet, you can choose cover up to a total sum insured of £400,00 or £800,000 worth of buildings insurance and a total of £50,000 or £75,000 contents insurance per property.
Keys and communal areas are not covered.
Whilst Airbnb gives some measure of protection for your home this cover does not apply to communal areas and if your keys are lost or stolen then you’ll have to foot the bill for replacing the locks on your door. With Inlet, communal areas are covered and if you choose our highest cover products, we will cover replacement locks up to the cost of £1,000.
Your liability cover might not be high enough.
To cover its hosts against potential liability claims brought about by guests that are injured on your property, Airbnb’s host protection insurance covers you for a maximum of $1 million in case such an event occurs. But what if this is not enough? For serious injuries, personal injury claims can often reach settlement figures well in excess of this and so not having the right light level of insurance to cover you could put you at serious risk. Similar to Airbnb’s guarantee, it’s protection insurance has a maximum limit of $10 million so if the total number of worldwide claims has already reached this limit then you may not be fully covered. Inlet covers you for up to a maximum of £2 million per accident or series of accidents if you think you need more cover
You are on your own with HMRC.
Whilst Airbnb covers third party personal injury claims, they will not cover any legal fees if you are investigated by the taxman as a result of any hosting activity. With Inlet we will cover the costs of an accountant to support you in your defence against HMRC.
You only have a short window to claim.
Making a claim with Airbnb can be tricky if the process continues for an extended period of time. Hosts can make a claim during the period of the guest’s stay and a maximum of 14 days after this. Once a claim has been submitted you get a maximum of 30 days for it to be resolved and if you want this to be extended you will have to get written permission. With Inlet, there are no restrictions on when you can claim. We are also regulated by the FCA so you will know you are covered and we won’t set any time limits on resolving your claim.
Conflict of interest.
What happens if you can’t resolve a dispute with Airbnb? If you’re not happy with the outcome you won’t be able to take legal action against them. There is also a gagging clause, which means that you’re prevented from discussing details of your case elsewhere. Inlet is independent so with us you’ll know there is no conflict of interest if you’re unhappy with a claim, even if you needed to take direct action against the booking provider themselves.
If you change your property then you may not be guaranteed for anything at all.
Be wary if you decide to upgrade your home. Airbnb’s host guarantee has an exoneration clause, meaning that if your property has changed materially then they don’t have to guarantee any claims. If you decide to go without special insurance to cover your property, think carefully before deciding to upgrade your kitchen.
You might be invalidating your home insurance.
If you decide to rely on Airbnb’s host protection insurance and guarantee, be sure to tell your primary home insurer. Renting out your room may constitute as business use and is excluded under most policies. Even if your insurer is happy to provide cover, most are unlikely to cover you for vandalism, theft and accident damage caused by a guest you have allowed into your home unless this happened as a result of forced entry. Inlet’s specialist cover has been designed as a complimentary add on to your own insurance policy so you know you will be insured if the worst happens. Be sure to check your own insurer’s terms and conditions.
Consider taking insurance elsewhere.
Airbnb has done a great service to its customers by offering a measure of protection that people would not otherwise get elsewhere. Before committing to anything, remember that there are some limitations to the protection you will get and you may not be covered by your home insurer. For more information about the products that Inlet offers, look here.