With insurance in the sharing economy, not much is known about the level of cover hosts have or need. It can be difficult to figure out whether you’re fully covered. So, we hope this helps you better navigate the tricky waters.
Chances are if you start using your property for commercial purposes, certain aspects of your home and contents policy become invalid, or it can become obsolete entirely. Leaving you, the host, exposed.
Airbnb has had a fast growth rate in the past year. As of June last year there were 115,000 listings in Australia alone, with this number continually increasing. Due to the high demand for these services, this trend has followed for other platforms such as Stayz and spurred the introduction of newcomers in the market. This increasing number of hosts (including you) means understanding your risk is of even greater importance.
Insurance for Airbnb and Stayz Hosts
The sharing economy is a fast-growing space, in which not many players offer the proper cover that hosts need. While landlords Insurance is the most commonly known, there are a few specifically designed products for the accommodation space, including Airbnb Host Protection Insurance and ShareCover, offered by Australia’s largest general insurer IAG.
What is Airbnb Host Protection? And is it enough?
Airbnb Host Protection Insurance is only offered to Airbnb hosts and can be an easy choice. It provides liability coverage up to $1 million and may cover claims if a guest damages building property.
It can cover primary liability claims where a guest has their property damaged or stolen during their stay on your property or is physically injured. However, it may not cover all potential instances and may not be enough for hosts to be fully protected. More specialised products are available that have higher levels of cover.
Why Landlord Insurance isn’t always the right fit
Landlord insurance typically covers hosts for stays longer than a few months rather than paying a premium per night.
It may not be ideal for those who are renting out a whole property and hoping to handle things remotely. Landlord Insurance does however, cover hosts for most liability and damage and most importantly covers loss of rent due to tenant default, subject to which landlord policy they purchase.
So what is ShareCover and why do I need it?
ShareCover is a specialised product made specifically to fill the gap in insurance for hosts in the sharing economy. It Is intended to be used in addition to standard home & contents policies (it does not replace standard home and contents insurance), specifically protecting hosts from any damage or liability caused by a paying guest.
ShareCover launched in late 2015 and provides the highest level of cover offered by any insurer for the sharing economy in Australia, already having covered over 200,000 nights. It covers a range of situations including; theft and attempted theft, accidental and malicious damage, personal liability, identity theft and strata property damage.
It is designed to be as flexible and fast moving as the sharing economy. Policies can cover short-term single stays ranging from 1 night to 90 days as well as 6 month and 12 month policies, so you only pay a premium for the nights you have a guest staying.
The pay per night feature of ShareCover is designed to provide more affordable and better suited options to landlord insurance for any member of the sharing economy, starting from as little as $5 a night.
A study conducted by NRMA found that people were still concerned about their property and contents being stolen or damaged when putting their properties up on platforms such as Airbnb and Stayz. The key insight discovered was that more than half of participants believed their standard home insurance would cover them, or were unsure if it did. It is important to ensure you have appropriate cover to protect you, your property and contents while paying guests are staying.
If hosts aren’t covered, they can face expensive repairs of their property or, even worse, they could face expensive public liability claims if a renter is injured while staying at their property. This could leave them footing the bill for hundreds of thousands of dollars.
ShareCover gives hosts peace of mind that they are protected against the unexpected. It is one of very few products developed specifically for hosts.