5 things to be aware of with your insurance as an Air BnB host in Australia

November 23, 2018

You like idea of earning some easy extra cash by renting out your home in Geelong or the Bellarine on Air BnB. Or maybe you want to take advantage of your home by the beach over summer and rent out a room. It seems like this would be risk free because Air BnB provide insurance for all their hosts for free. So it is easy right, just sign up and earn away. Actually no, it is not that simple at all.

Here are five things to consider if you are thinking about becoming an Air BnB host when it comes to your insurance.

1 – First thing to consider what type of Air BnB rental are you considering providing? Are you renting out your own home a couple of times a year or is the property your holiday home or an investment property. Or is your rental just a room in your own home?
Each of these types of situations will have different insurance requirements that need to be considered. For instance some home insurance policies will allow you to rent a room in your own home but will not cover you if you rent the whole home out. There are specific policies designed for if you rent out your own home regularly. No matter what type of rental you are considering you must advise your insurance company what you are planning to do before you list your property and take a note of the date you advised them of your intentions.

2 – Are you exclusively Air BnB? Or is your property also listed on other short term rental sites like Stayz, or Homeaway? Air BnB has a Host Guarantee Policy for damage caused by Air BnB guests but if you rent your property out via one of the other booking facilities you will need your own policy to cover malicious damage by those guests.

3 – What does the actual Air BnB Host Guarantee Policy actually cover?
Air BnB includes information on its website about their Host Guarantee Insurance Policy for damage caused by Air BnB guests but it does not cover the normal perils insurance covers like fire, water damage etc so you will still need a suitable insurance policy in place & you should definitely not rely solely on the Air BnB Host Guarantee to protect your interests.

4 – What are the costs of the insurance? If you are looking to make some money via Air BnB you will need to factor in the cost of insurance. The policies designed for short term rentals like Air BnB may be slightly more expensive or have higher excesses but if you don’t have the right insurance in place you might find that you are not covered in the event of a claim so it is worth getting the right policy even if it does cost you a little more in premium.

5 – Liability Limits – Air BnB states on their website that their policy covers building owners for $1 million USD for personal injury or property damage claims that happen “in a listing, or on an Air BnB property, during a stay”. So if a personal injury or property damage liability claim that occurs outside of a stay there is no cover offered by the Air BnB Host Protection Insurance. With this in mind it would be our advice not to rely on the Air BnB insurance & instead organise your own insurance.

Air BnB might seem like an easy and risk free way to earn some extra cash but when it comes to insurance is it actually quite complex. If you do decide to rent your property out via Air BnB make sure you advise your insurance company immediately and that you understand under what circumstances the Air BnB policy would cover you.

If you would like advice on how best to protect your property as an Air BnB Host you can call our office on 1800 222 766 and one of our team will provide advice specific to your situation.

Or contact us via contact details here

or request a quote for your Air BnB or Short Term Rental Property here

Advice provided in this post is general advice that means we have not taken into account any individual objectives, financial situation or needs you may have. Before acting on any advice in this article you should consider the appropriateness and suitability in light of your own individual objectives, financial situation or needs. If you so require, we can assist you in assessing the best option for your needs and provide you personalised advice, please contact our office.