How does listing my property on AirBnB affect my insurance policy?

Renting out your home can be a fantastic way of earning extra income. It does however, come with a number of risks.

What many people don’t realise, is that a standard homeowner’s insurance policy typically only covers your property if it’s being used for private residential purposes.

Airbnb provides a free ‘host guarantee’ designed to cover damages caused to your property by a guest, up to $1 million – subject to numerous terms & conditions. 

But this is not insurance and AirBnB clearly states that it ‘should not be considered a replacement or stand-in for homeowner’s or renter’s insurance’.

Visitors may not have the same duty of care towards your property as you do which results in a higher chance of damage or theft – your insurer will take this into account and, without written acceptance of the risk, may exclude cover all together while your property’s being utilized for AirBnB activity.

Your insurer takes various factors into consideration when determining your homeowner’s insurance premium, an important factor being the use of the building. Once your home is regularly let out on a short-term basis for an income it’s considered a business activity. This alters the risk from a residential, to a business risk and your insurer may adjust your premium accordingly or apply additional excesses.

So before opening your doors to a rental guest,  you should take the necessary steps to ensure that you have the correct insurance and liability cover in place.

What happens if someone is injured during their stay at your AirBnB?

Should a guest suffer an injury in your home, they’ll most likely seek compensation for their medical expenses and trauma. Any resultant legal case could be lengthy and very costly. Because AirBnB is classified as a business, your personal liability may not extend to protect you against this type of claim.

Please contact us 044 382 0550 to check if your homeowner’s policy includes cover for AirBnB. If not, we’ll certainly be able to assist with arranging the appropriate cover.