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Airbnb the insurance what ifs

Welcome mat Miriam

By Miriam O' Neill, AA Press Office.

I read an interesting statistic lately – on New Year’s Eve 2014 over half a million people globally were staying in Airbnb accommodation.  It seems that more and more of us are engaging in behaviours that would have seemed unthinkably fool hardy to us as recent as 5 years ago. 

Thanks to the internet and controversial innovators such as those behind Airbnb, Lyft and DogVacay we’re becoming increasingly willing to entrust our most valuable possessions from our homes, cars and even our pets to strangers.

My Airbnb experience
I recently had a taste of the Airbnb guest experience myself in Bondi Beach, Sydney.  Bar having the wrong pots and pans for what was a convection oven, the experience was very positive.  The cost of living in Sydney is a lot steeper than in Dublin so we were glad of the more affordable option right on the beach.

I’m not alone in my positive feedback either. On quizzing my nearest neighbours in the office here – the Roadwatch team-, almost all have ‘Airbnb-ed’ it and had a great experience.  From a house boat in Amsterdam to an apartment in Rio for Carnival, they’ve enjoyed quality accommodation and often an above and beyond level of hospitality.

A reluctant host
While I was happy to be a guest and wouldn’t hesitate to try it again, I’m a lot more reticent about being a host.  Perhaps I’m a late adaptor, I’ve been known to be one in the past, or perhaps I’ve been working for an insurance provider for too long.

Despite the assurances of their two way review system, the guests of the host and vice versa, there’s still that “what if?” voice in my head that would worry about being robbed or my property vandalised. 

The ins and outs of insurance

So this leads me on to the topic of insurance.  Would my home insurance cover me as a host if an Airbnb guest injured themselves while on my property and was suing me for negligence?  Or who pays up if my guests vandalised my property or that of my neighbour?

I also wonder would my travel insurance cover the cost of my Airbnb accommodation in the event of cancellation or my belongings if they’re stolen from my host’s property?

To get to the bottom of these “what if?” questions, I enlisted the expertise of my colleague Caroline O’Rourke, AA Product Manager:

Caroline O'Rourke

"Firstly before we delve into the few 'what if?' questions, I would advise anyone thinking about letting tourists into their homes as temporary paying guests to speak to their home insurance provider so that you’re absolutely clear on what you’re covered for and the potential risks that you are exposing yourself to.

Q. What if my guest is injured in my apartment?

You might find you need additional insurance such as public liability insurance to cover anyone injuring themselves on or around your property.  The Golden Rule - consult your home insurance provider on this for clarification before you sign up to be a host.

Q. What if my guest steals/damages my belongings?

You’ll more than likely be out of pocket is the simplest answer here. 

Home insurance policies typically exclude theft of personal belongings in cases where there has been no forcible entry or exit of the property.  Therefore theft by your paying Airbnb guest would be excluded.

Accidental damage by a paying guest is also excluded from most home insurance policies.  According to the Airbnb website they do however provide a Host Guarantee which will reimburse a host for up to £600,000 (€806,000) in damage to their eligible property.

While this might ease your mind some, they are clear to point out  that The Host Guarantee is not insurance and should not be considered as a stand-in for homeowners or renters insurance. The Host Guarantee does not protect:

• Cash and securities
• Pets
• Personal liability
• Shared or common areas

They also go on to advise on their website that certain types of property, such as jewellery, collectibles and artwork have more limited protections. If you’re a host you may want to secure or remove such valuables when renting your place, and may want to consider independent insurance to cover them.  Not all insurance plans will cover damage or loss to property caused by a guest that books your space so be sure to review and understand the terms of your insurance policy before you sign yourself up.

Q. What if my apartment is burglarized and some of my guest’s belongings are stolen?

Typically your home insurance will protect your contents but not those of your guest.

In the event of a burglary your guest will need to talk to their own home insurance provider, if they have one, in relation to any valuable items that they have specified on their policy for cover outside the home such as jewellery. 

They should also have a conversation with their travel insurance provider.  As with any insurance policy be it home or travel, close attention should be paid to the terms and conditions when signing up to it in the first place.  Some travel insurance policies for example will cover theft from a hotel room but not from a shared hostel room.  In other cases valuable items not secured in a hotel safe or safety deposit box will not be covered if left unattended. 

Q. What if I’ve booked Airbnb accommodation but have to cancel due to a family emergency or similar?

You should take the same kind of precautions you would for any trip.  Take out a good travel insurance policy and make sure you’re happy with the conditions surrounding cancellations.   In the context of cancellation most travel insurance providers are happy to treat Airbnb as they would any other type of accommodation provided you have proof of booking and any monies paid out.  However don’t automatically assume this, make sure you contact them to get clarification if you’re unsure.

It’s also important to pay attention to the cancellation policy that is attached to the Airbnb accommodation you’re booking into to.  Again according to their website the host has a choice of cancellation policies ranging from ‘flexible’ to ‘strict’ which can be viewed here.

Click here for an AA Home Insurance quote/ here for an AA Travel Insurance quote.