Common myths about AirBnB and insurance

With AirBnB increasing in popularity across the country it’s important to know that you have all your bases covered.  The most important but undervalued part of this, is making sure that you have the right insurance in place.

There is so much misinformation available out there on what to do, so let’s address the most common myths about having the right insurance in place when opening your home or space to short term paying guests on AirBnB.

Personal insurance and AirBnB protection will be enough

The most common misconception when it comes to this is that your normal personal insurance will be enough to cover you.  However, because your property is now used to generate income, personal insurance will no longer cover you for many of the losses that might occur.  AirBnB also provides limited protection but they will not cover you adequately for injuries on the property or if guests steal your belongings etc.

See also – The THREE most important questions to ask your insurer when informing them that you are starting an AirBnB.

You can keep your personal insurance and get a ‘top up’ product to cover the difference

The current rules state that you cannot have two insurance policies covering the same property, as it will result in dual / or double insurance.  This means that if you are renting out a section of your house or a little apartment on the property, you will have to obtain one policy to cover everything.  As we have already ascertained, a personal policy will not do this adequately.  You will need to have a specialized product in place that will not only cover your personal interests but those of the guest section.  This hybrid product will cover both and give you the benefits of wider cover, often at lower premiums.

The cover that you can put in place can be for buildings, contents, all risks, motor as well as the specialist sections of business interruption, bilking, guests’ effects cover, power surge etc. and public liability of course…

My insurance will cover theft by guests

Guests sometimes book in and then check out with more than they paid for.  Unfortunately, this seems to have become a rising occurrence in the industry and along with it, the assumption that personal insurance will be sufficient.  Personal insurance will not cover this as you willingly gave them the keys.  There is no forcible or violent entry or exit into the building, which is a requirement for cover.  You need a product that caters for paying guests.

It’s very important not to overlook these important issues and make sure that you get the right cover in place to protect yourself and your potential guests.