In South Africa the AirBnB community has blossomed, with many people opening up their homes (or second homes) to welcome foreign and national guests as the festive season draws nearer. Understandably so, South Africa has a lot to offer the international AirBnB guest with a huge variety of attractions hidden in every corner of the country. The competition is fierce with every AirBnB Owner checking all the boxes to ensure that the pictures and descriptions of their establishment are enticing to potential guests. Once the guest arrives hospitality becomes the exclusive focus, with many going for Superhost status by providing as many amenities and comforts of home as possible.
But what happens when the guest takes advantage of this and leaves with more than they paid for? In plain language, what happens when your paying guest steals your stuff and then disappears?
Unfortunately this is becoming more and more of a reality within the AirBnB community of South Africa and has long affected the other guest establishment niches, such as the guest house and bed and breakfast sector. The sad news is that although most AirBnB Owners start out by checking all of the boxes in terms of their pictures and descriptions of their property, they usually leave the biggest box unchecked. They assume that just because they have a personal insurance policy in place for their property, it will cover them. They aren’t necessarily doing this as a business as they just rent out one or two rooms, so there’s no need to get specialised insurance to protect them. Big mistake. Even more so if this has become your only/significant source of income.
In fact, the moment you receive any monetary payment for opening up your home to a guest, you have crossed the line from a personal situation to needing specialised cover for short term letting.
Which brings us back to our situation of a guest taking your belongings and leaving with them. Are you covered? We recently dealt with this exact situation so let’s look at a real life example that happened to an AirBnB Owner based in Cape Town.
The AirBnB Owner was not a client of ours at the time and had taken personal lines insurance cover with a reputable insurer in Cape Town. They’d been with this company for many years but failed to disclose to the insurer or their broker, that they offer their property for short term stays to AirBnB and other paying guests. In short they hand the keys over to short term paying guests. Sadly one of these sets of guests left with more than they came with and the client suffered a loss of R30 000. Obviously the client then tried to claim with their insurance company who rightfully denied the claim because there was NO FORCIBLE OR VIOLENT ENTRY/EXIT to the premises. This is a base requirement for theft cover on most personal lines insurance products across South Africa. Which means that unless you have specifically asked the three most important questions directly to your personal insurance company, your are most likely not insured for this specific event.
Is there a solution? Of course there is.
Had the client first looked into their AirBnB insurance situation they would have found that there are quite a few insurance products out there to cover a guest establishment – from AirBnB insurance to guest house insurance to Bed and breakfast insurance. As brokers specialising in this niche, we are able to quote with all the companies that provide this hybrid product and give you seasoned and sound advice on how to protect yourself from this same fate. This will include cover where there is theft by guests or even normal theft by burglars that does not have any forcible or violent entry or exit.
Additionally we can assist you in protecting your income with Business Interruption cover and provide you with Public Liability which protects you against a guests hurting themselves on your premises and holding you liable.
Get in touch with us for a no obligation quotation and industry based advice.