[WSBARP] Air BnB - Renting Personal Residence by the Day/Week

[Paul Neumiller]

I would state it even stronger.  While I haven’t researched the issue for
a while, I have a client with a stately home on Lake Tahoe just a few
properties down from where they filmed the Godfather III Lake Tahoe
scenes.  A movie producer wanted to rent the client’s house and properties
and we made inquires with the client’s insurance carrier.  We were
advised, and we later confirmed, that there would be no insurance coverage
under the standard homeowner’s policy because the policy specifically
excluded “all commercial activities.”  So, if you rent it out and make
money, you most likely will not have insurance if the tenants/BnB guests
burn it down.

 

 

-----Original Message-----
From: wsbarp-owner at listserv.nethelps.com
[mailto:wsbarp-owner at listserv.nethelps.com] On Behalf Of Robert R Rowley
Sent: Tuesday, January 07, 2014 7:47 AM
To: WSBA RPPT Real Property Discussion Forum
Subject: [WSBARP] Air BnB - Renting Personal Residence by the Day/Week

 

Listmates,

 

For those who are aware of Air BnB (and other like services) which is a
service which allows property owners to rent out their houses, apartments,
or rooms in a house on a daily and weekly basis.  Kind of like a
world-wide eBay for properties (for the uninitiated).  My wife and I are
actually utilizing the service for an upcoming spring break trip property.

 

I’ve had a couple of clients call and ask about potential liability issues
with renting out their personal residence using such a service.  Below is
the response from a local insurance broker that I trust.

 

Thought it would be a good primer on the potential liability issues and
potential insurance coverage issues with this latest in crowd-sourcing.

 

Rob Rowley

Spokane

 

-----------------------------------

 

Rob,

At this time the best thing for each person is to ask their current
insurance company how they can get coverage. This area is so new for
insurance companies to have developed a position. I believe what will
happen is over time there will be some claims and them the companies will
develop exclusions for this type of exposure. I know that Travelers,
Safeco and Allied would all take a dim view but there may not be an
exclusion so a claim may be covered.

If the person wants to be sure and not have that gray area then they could
get a policy that addresses this exposure directly. The policies I am
familiar with are going to be in the specialty market and cost much more
than a normal home policy. Say $2000 instead of $500.

Hope this helps.

 

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