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Airbnb’s Host Guarantee Is Not Property Insurance

In my last blog post I spoke about Airbnb’s Host Protection Insurance coverage which affords basic liability coverage for a host. Today we are going to cover their Host Guarantee Terms and Conditions.  The terms and conditions are dated June 19, 2017 and are subject to change.

The purpose of the Airbnb Host Guarantee is to provide protection for up to $1,000,000 (US Dollars) to a host for damages to the host’s property by a guest. Property can be both personal belongings and the home itself.  It provides protection above the security deposit you charge the guest. 

It’s not an insurance policy

Mentioned a few times in the Terms and Conditions, Airbnb’s Host Guarantee is not an insurance policy. Here is what this means to you.  When you buy an insurance policy you have certain rights under your state’s law and within the insurance policy you bought.  Airbnb’s Host Guarantee is just a contract. If you have any disputes with them about it, your state’s Department of Insurance is not going to help you with it.  Therefore, you would have to secure your own lawyer and take Airbnb to task through him.

Protection is provided by Airbnb if a guest or a guest’s invitee to your home causes damage to your property. Any events caused by nature, for example a hurricane, that happen during the guest’s stay are not covered by Airbnb.  If a guest, during his stay, leaves a candle lit and causes a fire, this would ultimately be protected by Airbnb.

Items that are not covered

The Airbnb Host Guarantee does not cover for damage to any of the following personal items:

  • Currency, Money, Notes or Securities
  • Animals, including livestock and pets
  • Watercraft of any kind unless that watercraft happens to be an accommodation
  • Vehicles of any kind including motorcycles.
  • Any growing crops.

Concerning Fine Arts

Fine arts & collectables have no coverage under the Airbnb. Airbnb considers the following items to be Fine Arts:

  • Paintings
  • Etchings
  • Printed Photos
  • Tapestries
  • Rare or art glass
  • Art Glass Windows
  • Valuable Ruga
  • Statuary
  • Sculptures
  • Antique Furniture
  • Antique Jewelry
  • Bric-a-brac
  • Porcelains
  • And similar property of rarity, historical value or artistic merit.

For some people this will be an issue. What you need to consider is a scheduled property floater under your homeowner’s policy or a separate fine arts floater if you have a large enough collection.

Issues with local ordinances

One of the challenges with older buildings is they fall out of current construction codes. Take, for example, my house which was built in 1955.  The wiring and circuit breaker box were not up to current electrical codes in 2012 when I bought it.  In some towns or cities a threshold is set where if the damage to a house exceeds a certain percentage then the whole house has to be brought up to code.  That threshold can be 25% or 50% depending on the local municipality.

Take, for example, the guest who left the candles lit causing a fire that destroyed your living room and dining room but left the rest of your house undamaged. The damage was enough to trigger compliance with current electrical construction codes.  Now you have to install all new electrical wires and hard wired smoke detectors throughout the entire house. 

In this scenario, under the Airbnb Host Guarantee, there is no protection for you.

Time frame to submit a claim

Airbnb has very restrictive requirements for reporting a claim to them. The time frame is the lesser of the following two scenarios 

  1. Within 14 days from the time your guest checks out.
  2. Before your next guest checks in.

If you have back-to-back guests you are going to have to inspect the house each time.

Amount of time Airbnb can settle a claim

According to the Terms & Conditions, Airbnb will settle a claim within three months after they have received all documentation required of you to show proof of loss. Contrast this with your own insurance carrier who, generally speaking, has thirty days to settle a claim once you have submitted your proof of loss.

Loss of Future Bookings

If the loss at your home is extensive enough that you have to cancel any future Airbnb bookings then you have some coverage for those lost bookings. Airbnb will only cover confirmed bookings that were made through them for your home before the loss occurred. 

So in other words, let’s say you were making $1,000 a month on bookings at your home. A loss occurs and it takes five months to fix your home.  Before your loss occurred you had about three months’ worth of bookings that had to be cancelled, but there were no bookings scheduled for the last two months.  You are only going to be paid for the three months of scheduled bookings.

Showing Proof of Ownership

One of the difficult things when it comes to property claims is showing proof of ownership. Most people don’t keep receipts and even those who do may have faded receipts.

If you have a loss, Airbnb will require that you show some kind of proof of ownership. They are very specific on what they want.  Proof can be any of the following: 

  1. Receipts
  2. Photographs
  3. Videos
  4. Documents and other verifiable forms of proof

If you are like most people you probably don’t have receipts or documentation. I suggest you grab your camera or your smartphone and take pictures and videos of your home before you have your first guest arrive.

Keeping this kind of documentation will allow you to provide Airbnb not only ownership but how extensive the damage is. Make sure your photographs are clear and in focus.  Take the photos or videos on a sunny day so you can maximize the amount of light in your house for photographs or videos.

In Summary

It’s important to understand how limited Airbnb’s Host Guarantee is. The protection granted by this program is only limited to damage by your guest and your guests invitees.  If you have a homeowner’s policy or a renter’s policy in place you need to maintain it.

Scott Harrigan

About Scott Harrigan

Scott started his career in insurance in 1988 and joined Rue Insurance in 2004 as a Marketing Specialist focusing on creating effective risk financing and risk transfer programs for companies and non-profit organizations. In addition to this he is a member of the Rue Insurance educational team that provides ongoing professional development in critical insurance concepts and programs to Rue employees. About Scott | More Posts by Scott