As a potential host, you’ve become quite curious at the prospect of making more money by welcoming strangers into your home. You’ve done some self-introspection making sure you are ready to start hosting on Airbnb. While working on Airbnb Host Steps 1 – 3, the question of insurance has come to mind. Does Airbnb provide insurance for hosts?
In the event something goes wrong, does Airbnb offer any type of support? Is there any type of insurance that Airbnb provides to hosts? What types of accidents or issues does Airbnb protect hosts against? Is private insurance needed? Are there any options that specifically cater to the Airbnb host community?
This article explores the ways in which Airbnb protects hosts and where hosts may be left exposed. Additional options to protect oneself are also included below. The Airbnb Ride wants you to be prepared for your hosting journey.
Airbnb Host Guarantee Vs. Host Protection Insurance
The big question is – Does Airbnb provide insurance? Unfortunately, that answer is a big NO. What Airbnb does provide is something called Host Guarantee. Host guarantee and host protection insurance are two very different terms with contrasting meanings. According to Airbnb Host Guarantee is not an insurance guarantee, as many have mistaken before. It’s a program which neither stands for replacement of cash nor covers personal liability, pets, collectability, jewelry, or artwork. Additionally, this program does not cover wear and tear damages.
That said, the host guarantee offers $1,000,000 for protection cover against rare event damages by the guests.
Host Guarantee is essential liability coverage in the rare case of bodily injuries and property damage during a guest’s stay at your listing. This program got introduced on October 22, 2015, as a host protection policy. The increased protection for hosts has resulted in more hosts registering on the Airbnb site. This host protection provides up to $1,000,000 per incident. The coverage is available for hosts regardless of any other insurances hosts may have.
Check out some sample incidents that the host protection insurance program covers.
- Injuries caused by a treadmill (when it breaks) while the guest is working out in the gym inside an apartment. The damage claimed against the landlord, or the host is viable.
- Injuries caused by a treadmill (when it breaks) while the guest is working out in the gym inside an apartment. The damage claimed against the landlord, or the host is viable.
- Injuries caused by a treadmill (when it breaks) while the guest is working out in the gym inside an apartment. The damage claimed against the landlord, or the host is viable.
Losses the Airbnb Host Guarantee Covers
Airbnb provides hosts with a Host Guarantee. However, particular rules and guidelines need to be followed. When you list your property using the Airbnb platform, you must understand the terms and conditions of their policy. To receive the full benefits of the host guarantee policy, hosts must comply with the requirements and terms stated. Some losses covered by Airbnb host guarantee include:
- The actual cash value is the amount of money used to replace damaged property due to a covered loss.
- Booking income loss is the loss of booking income (confirmed booking, agreements, or contracts) resulting from the cover loss. It only supports continuing charges and expenses.
- Sheltered accommodation covers accommodation of any property, including automobile, yacht, jets, boats, and motorbikes within the territory to be used as a residence. However, they need to comply with the Airbnb terms.
- Cover losses cover physical losses or damages caused by a guest or an invitee of the guest during the stay.
- The covered property covers property located within the perimeters of the accommodation space. In most cases, it is around 1,000 feet of the property in question.
The Downfalls of Airbnb Host Guarantee
Many times hosts may misunderstand the Airbnb Guarantee Terms and Conditions. As stated earlier, Airbnb’s Host Guarantee is not insurance. This is even stated that on their guarantee information page. That is why you, the host, must take extra time to read the terms and conditions carefully before embarking on the journey.
It would be fair to say that not everyone, including those with proficient knowledge of the Airbnb Host Guarantee Terms and Conditions, receives the full benefits in times of troubled listings. Why? Because the Airbnb policy is discreet and with hidden loopholes to protect themselves. However, this article aims to discover the Bigfoot of the host guarantee and its downfalls as best as possible!
While the Airbnb platform offers the host guarantee inside the property, an inch out of your home might cost you your policy protection. That goes especially for hosts with listings within condos or apartments. According to Airbnb policy, any damage beyond your individual listing’s walls is not their problem to cover. Be sure to check out “How to avoid Airbnb neighbor problems” before your first guest ever arrives.
The Airbnb guarantee claim window is up to 14 days after the guest’s stay has ended. That means hosts must report any issues in the form of a claim within 2 weeks after the guest has checked out. If you manage to submit your report on time, Airbnb gives a 30-day resolution period to send the payment request.
It is recommended all hosts carefully read the Host Guarantee Terms and Conditions. Clauses exist that that favor the guest. Thus, it’s wise to read these terms with a fresh understanding of avoiding the pitfalls.
Areas the Host Guarantee Terms and Conditions do not cover
- Non-accidental injuries or damages caused by the guest
- Accidents such as car collisions.
- Property and belonging damage (bed bugs, pollution, mold, and asbestos)
- Character Defamation or acts of slander
Non-Accidental Injuries or Damages Caused by the Guest
Hosts all hope that none of their bookings develop into these types of situations. To have a guest purposely cause damage or injury is extreme, but it can happen. Should purposeful injury or damage occur it becomes criminal. At this point the authorities need to be contacted. Airbnb does not extend their Host Guarantee to these types of instances. Airbnb does not play a part in the decision making that is dictated by the law.
Accidents to include Car Collisions
Remember, anything outside of the property is not included. Car crashes, regardless if the car actually crashed into your home, are not covered under the Airbnb Host Guarantee Terms and Conditions. “Why?”, you may ask. Because Airbnb gets to make the rules of what the platform will cover and what it will not. Accidents such as these are not only costly, but they are not uncommon. Airbnb has weighed the odds and has chosen to not include this within the realm of protection.
Property and Belonging Damage
As listed above, Airbnb will not protect hosts against things such as bed bugs, pollution, mold, and asbestos. From this list, let’s discuss bed bugs. Bed bugs can be a huge problem in major cities. Although this issue can occur anywhere, cities most frequently develop bedbug issues. The transient nature of guests going from one room to the next where other people have laid their heads can transfer bugs.
This is definitely something to be feared. Bedbugs may cause extreme damage and have been known to be quite difficult to get rid of. One bad review stating bedbugs can ruin your entire Airbnb profile. This article speaks to how you may check for bedbugs in between guests. Should you have an instance such as this that occurs, it is dire and must be taken care of immediately before allowing any further guests to check-in.
Character Defamation or acts of slander
Airbnb will not be held responsible for any personal attacks on your character as a host. Representatives from Airbnb are not present during your guests’ stay. Therefore, the company of Airbnb is not going to take sides per-se should a case such as this occur.
Short-Term Rental Insurance Designed for Airbnb Hosts
After reading the above restrictions within the Airbnb Host Guarantee, you may be wondering if there is anything out there to serve as insurance to protect you, the host. If you own the property that your listing is on, you most likely already have insurance. However, the insurance policy you possess most likely does not cover renters.
Should you choose to continue with your current policy please understand that you may be proceeding with risk. Some hosts may decide to update their policy to include paying guests from platforms such as Airbnb. Be prepared that not all regular home insurances allow paying renters to be included. Additionally, these companies may not be equipped to support the needs of a short-term rental host.
For hosts who choose to not modify their current policies, short-term rental insurance companies may bridge the gap in coverage.
Short-term Rental Insurance Options
Luckily with the popularity of Airbnb, companies now exist that specifically cater to the short-term rental host. As stated above, these companies help to bridge the gap that can exist between the Airbnb Host Guarantee and your home owners insurance policy. As always, discuss your individual situation with your insurance providers and/or legal representatives when deciding what is best for you.
When reviewing these companies or any other insurance options, there are several aspects to review before selecting an option. Customer reviews can serve as an important source of information. Be sure to look for companies that have integrity and stand by their products. Hosts need to make sure they are comfortable with their level of coverage when welcoming strangers into their homes.
Additional questions to consider when comparing short-term rental insurance options include:
- Is the vacancy clause included in the policy?
- Is a minimum night stay included by the insurance company?
- Does the system restrict any pets?
There are a few on the market now to choose from. If the Airbnb platform and similar home share opportunities continue to gain popularity, the choices are sure to increase in the future. In this article we will look at Slice, Proper, CBIZ, and Berkshire Hathaway Guard Insurance.
Progressive Home Share Insurance by Slice
Slice is short-term rental insurance for Airbnb and VRBO hosts. They are known to be the most innovative company in the insurance sector. Slice Insurance offers protection on the following:
Property– covers all damages and losses at cost valuation, from personal possessions to any of your property. However, it does not substitute for “the acts of God” damages caused by natural disasters.
Home share property covers for specific damages such as breakage of valuable items by accident, excessive use of utilities such as internet bills, utility bills, crazy renters, infestation coverage, rental interruption coverage vandalism, and malicious damage.
Liability– Slice Insurance bases its policy on the standard liability form. Such is liquor liability, canine liability.
Homeshare liability– covers damages caused to another person’s property. Such include vandalism, malicious damages, water damage to the third party, host liquor liability, cyber risk, infestation coverage, and fungal/mold liability.
Slice is the only company that provides insurance for Airbnb homeowners renting out a private room in their own home (home sharing).
Cons
- They do not cover damages caused by nature, such as earthquakes, floods, or tornadoes.
Proper Insurance
This short-term rental insurance policy covers both the company and homeowners’ risks encountered by Airbnb hosts.
Here is what their policy covers;
- Personal and commercial liability
- Building and contents damage
- Business interruption expenses
Pros
- They offer coverage for hosts who wish to rent their space on Airbnb while they stay elsewhere.
- They also offer coverage for personal liability and personal property.
- No occupancy restrictions
- Airbnb and VRBO exclusively endorse them.
Cons
- Their insurance does not offer cover for hosts who are home sharing their space with their guests.
- Not on-demand coverage.
- Liability insurance is often bundled with commercial insurance.
CBIZ Insurance
This short-term insurance coverage operates through the parent company Tudor. CBIZ was the first to provide short term rental services when other insurance companies hadn’t yet considered the option. Their services are publicly traded and offer more assurance for their clients.
They have a policy that allows guests to stay up to six months. Thereby, their insurance covers all the homeowner’s standard insurance policy. That means they cover the homeowner’s property, whether the home is occupied or vacant.
Berkshire Hathaway Guard Insurance Company
This short-term rental insurance coverage operates through a local agency called Old Harbor insurance who identifies Berkshire Hathaway as one of the best insurance with the best-short term vacation policies.
Pros
- Good reputation for their services
- Their insurance policy is appropriately and carefully tailored to meet all the needs of the client.
- Their prices are very consistent.
- They are flexible when it comes to addressing client claims.
Cons
- Unfortunately, this insurance is limited to some states.
Selecting the Right Short-Term Rental Insurance Option
When inviting strangers into your own home, you want to feel safe and comfortable with your decision to move forward on this exciting adventure. Hosts vary in their need for protection. It is vital one understands the Airbnb Host Guarantee before moving forward. Negative incidences are rare, but in the event difficulties arise it is best to be prepared.
Should you choose to have additional protection beyond the Airbnb Host Guarantee, the above selections for additional short-term rental insurance is an excellent area to start.
Wherever you are in your journey – Good luck and Happy Hosting!