Business Insurance COMMERCIAL

Discover the perfect insurance options to meet your specific and unique needs.

Read More
Auto Insurance AUTO

Auto insurance protects you against financial loss if you have an accident.

Read More
Homeowners Insurance HOME

A standard policy insures the home itself and the things you keep in it.

Read More
Transportation Insurance TRUCKING (Transportation)

Browse a variety of commercial vehicle insurance options to find the right one for you.

Read More


Renting your home—or second home—for a short time can be lucrative. For that reason, online rental services—such as Airbnb, HomeAway, VRBO and FlipKey—constitute a fast-growing industry, giving homeowners additional income for what most people assume is low risk.

On the other hand, a host of problems can accompany renting your property. Those include everything from not understanding the legal ramifications of operating a short-term rental to sustaining damage from careless renters. Here are a few basics.

Know the rules of renting your house
In May 2016, the city of New Orleans listed 317 legal short-term rentals, including traditional hotels. According to a company called “Inside Airbnb,” which tracks data in the sharing economy, 3,621 short-term rentals were active there in the same month.

Many say that the precipitous rise in short-term rentals drives up real estate prices and decreases housing stock, and more cities are instituting new regulations. Since operating illegally leaves you open to risks that are potentially not covered by insurance, make sure you have registered with the city before you list your property.

Fix hazards, look into liability
In one much-covered case, a renter in Texas hopped into a backyard hammock last Thanksgiving and died after the tree holding it up collapsed on his head. Incidents like this raise questions—and anxiety—about the liability for short-term landlords.

If a renter files a lawsuit against you claiming that an injury was due to your negligence, just defending yourself can be prohibitively expensive. Make sure you’ve taken every precaution to make your home safe for renters. Then check with your insurance agent about your coverage in the event of a third-party claim of injury or property damage, and if you’re specifically covered for short-term renters.

Airbnb has a Host Protection Insurance program that provides primary liability coverage for up to $1 million. But other hosting platforms may not provide liability insurance coverage, recommending instead that you buy short-term rental coverage from third-party insurers.SafelyStay offers insurance and will also screen your renters, verifying their identity and checking their names against fraud and crime databases.

Keep your belongings safe
Most rental platforms give good advice on screening renters, but just as important is securing your property. Artwork, china and silver, valuable furnishings, mementos—any of these could be stolen or damaged by the wrong renter.

Place small valuable items in a bank safe deposit box, move larger valuables to an off-site storage space, and/or keep a locked room onsite to hold the things you don’t want a renter to use. Rental platforms also highly recommend that if you don’t have a locking mailbox, arrange for a neighbor or property manager to pick up your mail, or have the post office hold it while guests are staying. Alternatively, rent a post office box.


Safety equipment
Most rental platforms require a minimum of supplies for guests and furnish a list of their requirements. At minimum for safety, you should maintain functioning smoke detectors, a fire extinguisher, a first-aid kit, and instructions to the air conditioning and heating, as well as the security system.

And in order to avoid confusion, leave a set of “house rules.” These should include whether smoking is allowed (and if so, where), and your rules on parties, loud music and on contacting the neighbors. Provide local emergency numbers and the address and phone number of the nearest hospital.


Declare your rental income
Finally, make sure you consult with an accountant on any federal and state taxes you may have to pay on your rental income. You’ll want to take short-term rental earnings into account when you balance your costs against potential earnings from your property.

Posted 12:00 PM  View Comments

Share |


No Comments


Post a Comment
Name
Required
E-Mail
Required (Not Displayed)
Comment
Required


All comments are moderated and stripped of HTML.
Submission Validation
Required
CAPTCHA
Change the CAPTCHA codeSpeak the CAPTCHA code
 
Enter the Validation Code from above.
NOTICE: This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.
Blog Archive


View Mobile Version
Facebook
Twitter
LinkedIn
Google+
Blog
AIG
CIGNA
Chubb
Great American
Berkshsire Hathaway Guard
Hanover
The Hartford
Philadelphia Insurance Company
© Copyright. All rights reserved.
Powered by Insurance Website Builder