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Article originally posted on www.insuranceneighbor.com(opens in new tab)
Becoming an Airbnb host is an exciting prospect, with a great financial upside. However, it is important to be aware that hosting others on your property comes with added risks. The visitors to your property are unknown to you, and you can’t be completely confident that they will treat your property with respect. You have invested in your property, adding all the features that attract visitors, including furniture, appliances, artwork, TVs, Wi-Fi systems, and a range of other features. Protecting your investment could not be more important.
Risks vs. Rewards
When planning to become an Airbnb host, consider what you are hoping to achieve. The added income you can gain must be balanced against the work you must perform to keep the property in good condition, and the time involved in being available to your visitors. Consider the time you devote to the property, along with the cost of maintenance against the income you earn.
The guests you allow on your property are hopefully clean, friendly, and responsible. Unfortunately, some guests are a nightmare. They may invite others to visit and have a loud, raucous party, break valuables, start a fire, leave a faucet running that leads to a flood… and the list goes on. Even the best guests will not respect your property the way you do and may damage your property. Along with the cost of repair, the stress can be a little more than expected.
Protecting Against Losses with Insurance
The idea behind an Airbnb is added income, so protecting your property is of great concern. The types of insurance you have in place could save you from a financial disaster when something goes wrong. Your home insurance will not cover damage to the furniture, appliances, or technology you have in your Airbnb. Meet with a local insurance agent to discuss putting the right insurances in place, which could include business insurance, landlord insurance, liability insurance, add-ons to your homeowners insurance, as well as personal property insurance if you are a victim of theft or vandalism. Every insurance company offers different levels of protection.
Injuries on Your Property
A guest could be injured while staying in your property, and hold you liable for their medical bills, lost wages, and other losses. You need to ensure you are fully protected against this risk if you plan to offer an Airbnb to travelers to your region. Personal liability insurance provides protection in the event of an accident on your property, and the cost of defending against a lawsuit. Personal umbrella liability insurance adds an extra layer of protection. All these possibilities should be fully discussed with your insurance agent, and a plan put in place that is both affordable and covers a range of risks.
It’s All In the Fine Print
An insurance policy is a legal document, with pages of fine print. Few people read these policies or understand fully what is and isn’t covered. With assistance from an insurance agent, your choice of policies is much safer – far better than clicking a button on a website that offers fast, cheap coverage that may do nothing for you when you most need help.Filed Under: Personal Insurance | Tagged With: Homeowners Insurance, Personal Insurance