Airbnb: Vacation Home Swap Insurance Debate

Airbnb Vacation Home Swap Insurance DebateAirbnb, a popular home swapping company, has run into some trouble for their supposed insurance program for hosts. According to Airbnb’s website, the complimentary liability coverage of up to $1 million is now available for tens of thousands of listings in the U.S. If you choose to use this service, however, it’s important still to consider your own Woodstock Homeowners Insurance risks.

While this may seem like great news, there is a catch. This insurance serves as “secondary” coverage to existing homeowners policies that the hosts already carry. In other words, any claims need to be submitted through the host’s primary homeowner’s insurance carrier first. However, the issue lies in the fact that the majority of homeowner’s policies do not offer protection against injury or death on the property when used for a commercial business.

Rebecca Hirsh, USAA spokeswoman stated “If you’re conducting business, on a full or part-time basis, by renting out your home or apartment as a way to earn money, your homeowner’s or renter’s insurance policy probably would not provide liability coverage.” Homeowner policies are strictly for home use and do not extend coverage for any type of business use. Further, if the host fails to notify the insurance company of its intended business ventures, the homeowner or renter faces the potential risk of discontinued service and/or rejected claim coverage.

So, why might Airbnb promote this option? Well, they were forced to make quick adjustments in relation to the new “sharing economy” debate sparked by Uber. For example, San Francisco now requires hosts to carry a minimum of $500,000 in liability coverage. Next, some insurance companies do have exceptions to their homeowner’s exclusions. In these cases, Airbnb’s business model might be successful if loopholes are found. Lastly, offering primary coverage to each host-all 800,000 of them, is simply not feasible as it would cost Airbnb millions of dollars each year.

Airbnb is working to find solutions to this issue while still attempting to maintain the easy booking process it offers. Jonathan Golden, product leader for Airbnb, explained “We wanted the experience for our hosts to be automatic and easy and offer real peace of mind versus going to another site and potentially having to purchase another policy.”

As the sharing economy continues to develop, it is critical you evaluate your insurance coverage prior to engaging in home swapping. At Byrnes Agency, we understand the risks associated with renting out your home and seek to provide ample coverage to protect your home and assets. To learn more about properly protecting your home, contact our specialists today at one of our three locations.

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Dayville Office

Phone: (860) 774-8549
394 Lake Rd
Dayville, CT 06241
United States
info@byrnesagency.com
Hours of Operation: Monday- Friday 9:00am-5:00pm

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Norwich Office

Phone: (860) 886-5498
6 Consumers Avenue
Norwich, CT 06360
United States
info@byrnesagency.com
Hours of Operation: Monday- Friday 9:00am-5:00pm

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Woodstock Office

Phone: (860) 928-7928
1226 Connecticut 169
Woodstock, CT 06281
United States
info@byrnesagency.com
Hours of Operation: Monday- Friday 9:00am-5:00pm

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