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AirBnB: The Insurance Issue

The social-sharing growth phenomena of AirBnB has been topical in the media of late. AirBnB is just one of many home rental services such as VRBO (Vacation Rental By Owner), HomeAway, FlipKey, etc. All of these companies utilize the Internet as a means of presenting properties as temporary accommodations. They are, in effect, competing with traditional hotels and resorts. Their websites are enticing and work well.

But should you decide to cast your lot and offer your home as a place to stay, you should be aware of the insurance implications. Typically, your residential insurance is based upon non-commercial use of your property. Offering your home, or even a room or two, constitutes a commercial venture.

AirBnB claims to have a blanket policy that covers abuse incurred by a renter through their system. While this may provide some coverage in serious situations, it should not be considered as a supplement to appropriate core insurance coverage.

While it might be tempting to make a little bit of extra cash renting out a spare room, we recommend that you consult your insurance broker or company agent before undertaking such a venture, as this constitutes a change in use and may involve a premium adjustment.