25th January 2016
People are being urged to check with their home insurer, landlord or mortgage provider before signing-up as home-hosts.
As one unlucky home-host recently found to his cost when his family home was trashed by Airbnb guests, peer-to-peer holiday lets are not without risks.
Nigel Broome rented his Forest Hill, South-East London flat to holidaymakers through Airbnb. Mr Broome alleges that £12,000 worth of damage – including ruined flooring, holes punched in walls and broken furniture – was caused by a New Year’s party the renter held at his home.
Ben Wilson, from Gocompare.com said: “Lower accommodation prices and the ability to ‘live like a local’ have made Airbnb and other social travel websites incredibly popular. A recent survey suggested that well over a third of people have already experienced a peer-to-peer holiday, while 72% said they would like to try one in the near future.
“With thousands of properties listed for rent in the UK, many people use these sites to earn extra income from their homes. But, welcoming paying guests into your home, without first checking the implications for your home insurance, lease or mortgage, could be a costly mistake.”
Wilson explained that household buildings and contents insurance premiums are, in part, based on who lives in a property and whether it is used for purely residential or business purposes.
So, your insurer will want to know if you plan to let out your home in part or entirely, even on a short-term basis.
They then may refuse cover, charge an extra premium or put restrictions on the cover provided. For example, theft may be excluded unless there are signs of a break in. If you don’t tell your insurer about your home-host plans, then they may refuse to pay any claims and your insurance could be invalidated.
Wilson added: “Some peer-to-peer lending sites provide insurance cover for home-hosts but, cover for damage to property is generally limited and personal liability is typically excluded. For example, Airbnb’s Host Guarantee provides protection for up to £600,000 in damages but, this excludes cover for cash, pets, personal liability, shared or common areas while providing limited cover for valuables, collectibles and artworks. Airbnb makes it clear that home-hosts shouldn’t consider its Host Guarantee as a replacement or stand-in for homeowners’ or renters’ insurance.
Before listing their property to let on a peer-to-peer holiday site, Gocompare.com also strongly advises people to contact their landlord or mortgage provider to check that doing so doesn’t breach the terms of their mortgage or tenancy agreement.