Becoming an Airbnb host, a great idea or a great risk?

By: Denise Koslowsky

There are approximately 620 people in Westchester County making supplemental income hosting guests in their homes through Airbnb.  According to the head of northeast public Policy for Airbnb, in 2018 total Westchester County Airbnb host income was $6.6 million, with the average host earning $7100!  Future forecasts look even brighter, as the Hudson Valley is one of the top destinations in the world.  People flock to our little corner of the world to explore our hiking, skiing, vineyards and farms.  It is projected to be the 15th most popular spot for travelers in 2019.

People who are considering opening their home to share through services like Airbnb may wonder about their insurance coverage should the unexpected happen. Your homeowners insurance may not automatically protect your property against damage, nor would it protect you against liability claims.

What you need to know

If you are regularly renting out your home or part of your home, the insurance company will look at this as a business activity which means a typical homeowner’s policy will not cover you should something happen during an Airbnb rental.  In this case you will need business insurance.

Additionally, if you will be renting the entire home for a longer length of time, you should consider Landlord Insurance.  Landlord insurance will protect not only the home itself, but also additional structures such as a garage or shed.

While Airbnb does offer Host Protection Insurance, it may be a good idea to have a conversation with your Insurance Specialist.  You’ll want to be sure any risks unique to your situation are covered and a specialist like the ones at Advocate Brokerage will be able to discuss your options.  Airbnb’s policy provides homeowners up to $1 million of coverage per occurrence against any third-party claims, but like any policy, it does contain conditions and limitations so you’ll want to consider it carefully.


Reducing your risks

Before you rent out your home, you’ll want to do all you can to ensure that your home is safe.  Minimizing safety risks for future guests isn’t just the right thing to do; it also lessens the chances of being sued by a guest who is injured while staying in your home.

If you don’t already have one in place, beginning the journey as an Airbnb host is a great reason to consider an umbrella policy.

Educating our clients about all the little details you need to know when it comes to protecting your home is of the utmost importance to the entire team at Advocate Brokerage.  If you are considering renting out your home but have questions, about the risk, feel free to get in touch with us at 914-723-7100.  We would be happy to take the time to review your current insurance and discuss any vulnerability you need to consider before opening up your home to renters.

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