Why use Airbnb?

Estimated read: 10 minutes

Airbnb has exploded in popularity worldwide due to its ability to offer personalised, authentic experiences that hotels can’t offer. If you haven’t already taken advantage of this phenomenon already, we provide some top reasons why you should consider listing your spare room or property online.

Earn extra income

You don’t need an office and a warehouse full a stock to make money. All you need is a room spare to start earning extra cash. Some key benefits include:

  • Covering the short-fall in your rent. Maybe you need a roommate or your rent is too high. You can list your property on Airbnb at anytime and doing so is a great quick cash injection, even if you only plan to do it occasionally. If this situation applies to you, make sure you get consent from your landlord for doing this.
  • If you are looking to make serious cash, it’s possible to do this through Airbnb depending on your circumstances and how much you want to earn. If you live in a popular location then it is possible you could get high demand for guests looking to stay at your property. Have a look at Airbnb listings in your area, which could give you an indication as to how popular it is.
  • If you are just intending to use items already in your house (e.g. bed linen, furniture etc) then there are very few additional start up costs to consider when listing your Airbnb. This is unlike some other businesses, where some level investment is required before any money comes in.

Higher returns.

Letting our your room or property via Airbnb could be more profitable than through traditional means such as through a landlord tenancy. Some of the reasons for this include:

  • Charging a daily rate. Like a hotel, the rate you would typically charge a guest is higher than if they were living there all of the time.
  • Peak times. During the holiday season, you can charge even more and reasonably expect guests to pay this provided that you are not too out of step with what other Airbnb hosts in your area charge.
  • Airbnb is still an emerging market. Unlike the traditional landlord market, which has landlords competing against each other for tenants, the Airbnb sector is less established.
  • If the house you are listing is a luxury property and has the relevant ‘wow’ factors, guests may be willing to pay more money to stay there. Have a look on Airbnb to see if there are any such properties in your area.

It’s worth bearing in mind however that there are several factors that could affect how much income you could earn over the year. Check out our Airbnb vs landlord guide for more information.

It’s a great alternative to hotels.

Some Airbnb properties can have an advantage over hotels for users looking to:

  • Rent out an entire home.
  • Find accommodation at a cheaper price.
  • Have a more authentic local experience.
  • Stay in convenient locations.
  • Find houses that have novelty value.
  • Have a more personal experience.

If you think your home could fit one of these descriptions, you could be missing out on a potentially lucrative revenue stream. Think about what makes your place unique. What does it offer that a hotel can’t? Write down a list. If you can’t think of any good ideas, try to cast your mind back to when you stayed somewhere great that wasn’t a hotel. What made your stay special? What could you do better? If you can create an experience for your guests that is difficult to replicate elsewhere, guests will keep coming and you might have a potential full-time business, if that is what you are looking to do.

It’s flexible.

You can list your property as many times as you want on Airbnb and if you get someone else to manage your property such as a co-host or a host management company, you won’t even have to be there on a regular basis. This makes being an Airbnb host a flexible business that can be attractive to many individuals including:

  • Stay at home parents. If you have a spare room or annex, you can work from home, look after the kids and still have income.
  • Travellers. If you go on holiday and the house is empty, you could bring in extra cash whilst you are holidaying elsewhere.
  • Remote workers. If your goal is to work remotely, you can do this as long as you can get or hire someone else to manage the property whilst you are away.
  • Landlords. If your property is in between tenancies, you can list your property on Airbnb and fill that gap in income.
  • Self employed workers. One of the risks of working for yourself is that your income is vulnerable if you only have one revenue stream. Rather than putting all of your eggs into one basket, it makes sense to diversify where you get your money from and Airbnb is an easily accessible means of doing this.

You can host unique experiences

Do you know how to cook and would be interested in holding courses teaching other people? Do you have a unique skill? Airbnb allow hosts to hold ‘Airbnb Experience’ days. Hosts that do this hold events or classes that go beyond the usual class atmosphere and put the guest in the shoes of the host’s world. You don’t even need to share their home to do this. All you need is a skill or hobby that they want to share with the world. Top reasons to consider hosting your own experience are:

  • Unique selling points. If you can host a unique or quirky event for guests, you’ll attract more of them and may even get more positive reviews.
  • Personal touch. You’ll be connecting with guest in a completely different way and get to know them better.
  • It’s fun. Running an Airbnb doesn’t have to just be about the mundane tasks of cleaning, meeting and greeting. Host an experience for something you are passionate about.

To start with, have a look on Airbnb’s website and see what kind of things are on offer. You will attract more guests to your experience days if you are able to stand out from the crowd. What knowledge do you have that sets you apart from everyone else? Don’t be afraid to let the world know! Once you’ve come up with your idea, you’ll need to submit it to Airbnb for approval.

Meet new people

Airbnb doesn’t have to be about making money. It’s also a great way of making friends. If this is your goal, consider renting your room or annex rather than your entire property. Here are some tips to make sure that both of you enjoy your guest’s stay:

  • Make a meal for your guest. If you are a good cook, why not make them a local meal?
  • Give your guest a tour of the local area. Immerse them in an another culture.
  • Think about the type of guest your want to stay at your property. If you have a particular type of person you want to stay at your home, this should inform how you present your property and describe your listing.

Travel the world

Once you have done Airbnb for a while there is a good chance you will have made friends with people all over the world. You will potentially reap benefits from this including:

  • Returning the favour. If you have made friends with guests, why not visit them in their country?
  • Meeting people from different cultures can give you a new perspective on things. If you do gain some insights, you may want to use these to improve your guest experience. You could even travel to an Airbnb in another country to see how things are done differently elsewhere.

Even if you don’t want to travel, meeting people from different cultures can be an enriching experience and it can be fun too!

Low start up costs

The great thing about running an Airbnb is that you may not have to incur any large additional costs just to get up and running when you start out. If you want to experiment with Airbnb but don’t want to spend a lot of money, here are some handy tips to get you going:

  • Search classified ads or websites such as Gumtree for second hand items such as furniture on the cheap or even for free.
  • Items such as televisions and mirrors are bulky but guests are likely to want these kinds of things when they stay at your property. You might be able to find some great collection only deals at local locations on websites that sell secondhand items.
  • Guests often expect items that they get in hotels such as tea and coffee but these things don’t necessarily have to be expensive. Many supermarkets have value brands for these items that are much cheaper. If you can source packaging from elsewhere, you can still give these items a personal touch without the appearance of being cheap.

Learn about business

If you are already doing it and having fun, you may not have realised that Airbnb is a business just like any other. To be successful and make a money from it, you will have to learn how to:

  • Make your customers happy. Part of doing this is to understand what your guest wants, listening to feedback and constantly striving to make their experiences better.
  • Keep a record of income, expenses and costs. Not only will you need to do this for tax reasons, you will also need to do this to make sure more money comes in than goes out.
  • Deal with problems. Like any business, not everything will run smoothly. Guests may complain, things could break or bookings could decline. Learning how to overcome such issues are invaluable skills that you can put to good use in any future business venture you choose to embark upon.

Taking things further

There are many great reasons to become an Airbnb host. If you are looking to take things further, check out our guide on being an Airbnb Host. Before you list your property online, it is also important you speak to your insurer first to make sure you are covered. Our Airbnb article for homeowners and our guide for landlords can give you some important tips if you are not sure if you will be covered.

Will HomeAway cover me if something goes wrong?

Estimated read time: 8 minutes

If you rent out your property to guests through HomeAway, you might be wondering what you are covered for if a guest has an injury or causes damage to your home. Whilst HomeAway does offer some level of cover, it’s important to understand what this protects you for and what it won’t or you could end up seriously out of pocket.

Does HomeAway offer insurance?

If you list your property on their website, HomeAway does provide insurance but this is only for liability claims, which are designed to cover you against risks that you as a host may end up being held responsible for. HomeAway offer up to $1 million (or the equivalent UK amount) of cover per listing free to all of its hosts. This makes their cover similar Airbnb’s Host Protection Insurance, which you can find out more about in our Airbnb guide. The insurance provided by HomeAway covers liability claims brought against the host for incidents such as:

Guest injuries. For example, if your guest fell down the stairs and hurt themselves they may hold you responsible and decide to take legal action.

A guest damaging 3rd party property. An example of where this could be relevant could be your guest lighting up a cigarette and accidentally setting fire to your neighbours property.

A guest injuring a 3rd party. Think back to the fire scenario above. If the neighbour was injured in the fire then they may decide to hold you liable.

What HomeAway does not cover.

Given that HomeAway only covers liability claims, this does not make it comparable to what you would expect from a home or landlord insurance policy. Here are some notable things that HomeAway does not cover:

Damages above $1 million. You might be thinking this is unlikely that a claim could cost this much but it depends on the type of claim. If a guest is injured badly and unable to work again, the costs could mount up. A serious injury could require lifetime care. If you factor in loss of potential earnings, some claims could cost more than $1 million, which could mean you may have to fit the bill.

Damage to your own property is not covered. If a guest burns your house down, you’d need your insurer to cover you for this if you don’t want to pay for damages out of your own pocket. However, many insurers will not cover claims caused by paying guests (more on this below).

If the guest injures you then you won’t be able to use HomeAway’s insurance to take legal action against the guest.

If the damage/injury caused by the guest is deemed to be deliberate or ‘malicious’ then this won’t be covered either. HomeAway’s insurance is designed to cover you against scenarios that are caused accidentally.

You won’t be covered if you have been deemed to have acted negligibly. This is a fairly standard principle followed by most insurers. However, it isn’t entirely clear how ‘negligible’ has been defined. This could give them wiggle room in deciding whether to cover your claim or not.

What to do if you need more cover.

If you are worried about whether you have the right level of cover, the next step to take is to talk to your insurer. However, we spoke to top UK insurers that confirmed that most do not provide adequate cover for Airbnb, HomeAway or similar platforms. Our Airbnb and home insurance article discusses this subject in more detail and is a good place to start before you contact your insurer. If your home is covered under a second home or holiday home insurance policy, your cover for guest related claims may still be inadequate and so it’s important to check with your insurer first. If you have already spoken to your insurer and you are not happy with your level of insurance cover, a specialist insurance policy may be able to fill this gap.

What does Pikl cover?

Pikl provide specialist insurance for short-term letting, including cover for properties that are let out on websites such as HomeAway. If you already have insurance elsewhere, we offer a ‘Top-Up’ insurance policy. Your insurer can still continue to cover you whilst our cover can insure your home for any claims caused by your guests. You’ll need to let your insurer know that you are intending to do this but alternatively, we can also cover your main home or landlord insurance as well as cover for your guests. Our insurance for when you have short-term guests can cover you for:

  • Public liability including cover for guest accidents involving bodily injury.
  • Legal cover to defend or pursue legal claims against guests.
  • Accidental, malicious damage and theft cover if caused by a guest.
  • Alternative accommodation for you or your guest if your property is being fixed as the result of a guest related claim.
  • Fire and escape of water damage caused by a guest.
  • Loss of keys and replacement locks cover if renting out your entire property.

The above is an example of some of the cover we offer. If you are not comfortable with the level of cover HomeAway or your insurer provide, getting a specialist insurance policy is a relatively straightforward way of covering this gap in insurance.

Airbnb vs the alternatives. Which Vacation rental site is the best?

Estimated Read: 10 minutes.

There are now several vacation rental platforms that compete with Airbnb. Given the variety of choice that is now available, choosing the right one can be confusing. Lets look at the pros and cons of using each one.

Airbnb

Whilst they are not the oldest of all of the companies on here, they are the most established. The dominant player with a huge global reach, Airbnb has become a household name.

Advantages of using Airbnb:

It’s booking fees are relatively modest compared to other platforms at 3% (with some exceptions).

Unlike some other platforms it does offer some protection to its hosts if something goes wrong (e.g. if a guest damages your house or is injured).

Airbnb allows you to rent out just a room unlike some other platforms. This is great for people that aren’t ready to rent out their entire property or are just looking to test the waters.

It is the big player in the market. Its name is global and you could have a potentially larger reach of guests that could be interested in your property.

Disadvantages of using Airbnb:

The protection offered by Airbnb is limited. If you rely on them to cover you, you could be seriously out of pocket if they do not pay out on a claim.

Unless you are a hotel or hospitality business, Airbnb charges guests a service fee to cover the costs of things like credit card fees and customer support.

Being global could mean that you have more competition. This is better for guests but could be tougher for hosts in terms of maximising the number of bookings they get. If your property is in a popular area then this may apply to you.

HomeAway and VRBO.

Owned by the Expedia Group, HomeAway was actually founded 4 years before Airbnb. In 2015, Expedia also acquired VRBO.

Advantages of using HomeAway and VRBO:

Like Airbnb, HomeAway and VBRO also offer some protection to its hosts such as if a guest is injured or if a guest damages someone else’s property.

It also has worldwide reach.

Both HomeAway and VRBO give you the option to pay annual subscriptions.

As the Airbnb industry grows and becomes widely seen as an acceptable alternative to hotels, more and more people may seek Airbnb alternatives. Savvy hosts may also look to use alternative platforms that already have brand recognition.

Disadvantages of using HomeAway and VRBO:

The protection offered by both platforms is also limited and unlike Airbnb they don’t cover any host property damage. Check out our HomeAway article for more info.

Unlike Airbnb you can only rent out your entire property. If you can only rent out your room then HomeAway and VRBO will not be the platforms for you.

Their host fees are higher than Airbnb’s.

Booking.com

A massive player in the hotel and travel industry, Booking.com now also allows hosts to list their property online and compete with hotels.

Advantages of using Booking.com:

Booking.com charge a single fee, which makes it more straightforward than other platforms that have different charges.

They are a household name in the accommodation industry, meaning that you will have visibility to a wide audience.

Unlike websites like Airbnb, Booking.com also lists hotels on its platform. This could give you exposure to a different audience to other platforms.

Booking.com does not charge guests any additional fees unlike platforms such as Airbnb, which could make it more attractive to some guests.

Disadvantages of using Booking.com:

You will get no insurance protection if something goes wrong.

You can only list entire homes.

At 15%, their commission is the highest of the platforms listed here.

Being listed alongside hotels could be a double-edged sword as you could be competing with them.

TripAdvisor and FlipKey

Whilst being primarily well known across the world as a social media travel review website, TripAdvisor also allows visitors to look at comparison tools for booking holidays and accommodation. FlipKey is a vacation rental website like Airbnb. It was acquired by TripAdvisor in 2008. HouseTrip is similar to FlipKey and was acquired by TripAdvisor in 2016.

Advantages of using TripAdvisor, FlipKey or HouseTrip:

TripAdvisor is a big company with millions of visitors to its site.

TripAdvisor is already a household name in the travel industry, which will help it attract potential guests. This brand recognition also benefits owners listing their property on FlipKey and HouseTrip.

On TripAdvisor you can also book hotels and flights, which could give your property exposure to a more diverse audience than on websites like Airbnb.

Owners on FlipKey and HouseTrip may face less competition in the UK as they are less well known.

Disadvantages of using TripAdvisor and FlipKey:

No protection is offered to owners if their property is damaged by a guest or if a claim is brought against them.

You can only list your entire home.

Like Airbnb, TripAdvisor, FlipKey and HouseTrip charge additional fees to guests, which could put them off.

FkipKey and House Trip are less well known in the UK. You could have less guest bookings.

On TripAdvisor, you will be competing against hotels.

Which platform is the best?

It really depends on your situation on what your goals are. Your market research and the type of guest you want to attract could also decide which platform you decide to use. If you are completely new to hosting, you may want to check out our guide on being an Airbnb host.

Renting out a room, just starting out or want your property to be viewed by lots of guests?

Airbnb is a good place to start if you fall into this category. It is the only place listed here that allows you to rent out just your room, it has instant brand recognition and millions of guests worldwide that use its site every year.

Do you want to use a platform that offers protection if something goes wrong?

Airbnb and HomeAway are the only platforms at the time of writing that offer some protection. HomeAway however, offer no cover for damage to the host’s property unlike Airbnb. Overall, the cover that both platforms is limited. You may also want to consider taking out specialist insurance with a broker such as Pikl as most home and landlord insurers will not provide adequate insurance cover either.

Looking for an Airbnb alternative or more flexible fee options?

Whilst less well known than Airbnb, HomeAway and VRBO are also big players in this market with lots of guests also using their service. Their annual subscription option for hosts is a nice option if you are tempted by the idea of paying a lump sum annual fee rather than paying a commission per booking.

Want a service that doesn’t charge guests fees?

Booking.com is the platform to use although its host fees are quite steep at 15% per booking.

Are fees important to you?

If you just want to use the site with the lowest commission then Airbnb and TripAdvisor are the cheapest. Booking.com is the highest but as you would be competing with hotels, customers on there may expect to pay higher fees.

Are you trying to reach out to customers that would ordinarily use hotels?

Booking.com and TripAdvisor are the clear winners here.

Looking for less competition?

The competition you will face with other owners will depend on other factors such as where your property is based. However, you may want to consider using well known websites in the UK such as FlipKey and HouseTrip if you’re facing stiff competition elsewhere.

Looking for a platform with brand recognition?

Airbnb is a household name and HomeAway also has a worldwide following. Booking.com and TripAdvisor are already household names. If a platform with brand recognition is your main concern, you probably could not go wrong with any of these.

Are you doing this as a full-time business?

You may want to consider using as many websites as possible to maximise the number of bookings you get. Don’t forget to sync your calendars so that you don’t overbook. You will also need to factor in the different costs into your business plan so that they do not eat into your profits.

How to become an Airbnb Host: 11 essential tips to get you started.

Estimated Read: 10 minutes.

Thinking of listing your property on Airbnb? There is more to being a host than just taking some photos and listing your property online. Here are 11 essential tips that will set you on your way to from beginner to Airbnb expert.

1 . Check the law in your area

Local regulations around Airbnb and short term letting vary depending on where you live in the UK. In London, a 90 day restriction applies, meaning that no property can be let out on Airbnb for more than 90 days in a year. Similar proposals for potential future restrictions have been well reported elsewhere and so it is important to check you are up to date.

If your property is in Northern Ireland, it may be illegal to list your property on sites like Airbnb unless you are certified by the Northern Ireland Tourist Board. If you are unsure whether you fit into one of their tourist accommodation categories, check out their website or get in contact with them.

Fire safety regulations also apply if your property is in Scotland, Northern Ireland or England and Wales if you let your property out to guests.

2 . You probably need specialist insurance

Our research has shown most home insurers do not provide adequate cover for Airbnb. If you have landlord insurance, you might not be covered either. The cover that Airbnb provides is also limited. If your property is covered by second home or holiday home insurance, the cover provided by these types of insurance policies for claims caused by paying guests that stay at your property is usually inadequate. Check with your insurer first. If you need more cover, a specialist broker such as Pikl may be able to help you.

3 . How much work do you intend to put in?

Whilst there are high rewards, being an Airbnb host can be a lot of work. Even if you intend to only do it part-time, you will be responsible for tasks like changing sheets, meeting guests and logging records. If you intend to have guests regularly then that is a lot of work on a recurring basis. Alternatively, if you rent your entire house out then it may be easier to be a landlord and have long term tenants. In our Airbnb vs Landlord article, we weigh up the pros and cons so you can decide. Another option if you intend to have regular guests is to get a host management company to manage your property for you. They will do tasks on your behalf including meeting guests and cleaning but it is important to factor in the cost of hiring someone to do this.

4 . Get in the mind of your guests

Think about the location of where your property is based. Is it a holiday location? A popular destination for events? Find out where the local amenities and attractions are. Not only can this make your listing description more informative and attractive to guests, but it can also get you thinking about what kind of guests you want to attract. Do you want to attract couples or individuals? Business people or travellers? Think about what type of property these people might like and present your listing accordingly.

Once you have thought about your area and what kind of guests you want to attract you can start thinking about what prices you want to set. You do not have to set it to the lowest price as this may send the wrong signals. If your area that is quite popular or you think you could attract guests with more money then a higher price may be more appropriate as guests may be expecting this. Another thing to consider is any additional potential fees you may wish to charge. Would you incorporate a cleaning fee as part of the charge for the room or charge this separately? Are there any other fees to consider such as a late check in or pet fee? Crucial to making these decisions is checking out your competition.

5 . Check out the competition

Look at the current listings in your area. What prices have they set? How have they presented their property? What amenities do they list? This is vital research you should be doing before you list your property online. What do they do well? What do they do poorly? Write down a list and think about potential unique selling points that might make your listing stand out from the others.

6 . Is your space equipped for renting?

Providing happy guest experiences is key to being a good host. Put your health and safety hat on and go over your home with a fine tooth comb to make sure there are no hidden dangers lurking. Broken mattress springs, broken fire or carbon monoxide detectors, trip hazards and exposed wires should all be fixed.

Make it easy for your guests. Is your door handle easy to turn? Do all your lights work? Consider fixing the little quirks you take for granted or leave instructions behind.

Guests not only expect a clean, tidy space, they are looking for a hotel or B&B experience. Consider whether you are going to provide tea and coffee making facilities, Wi-Fi, a TV or any other home comforts. Tidy away any personal belongings or items which people may find offensive or distasteful. Remember your ideal guest and think about leaving them a list of local amenities and attractions in the area as a nice personal touch.

A great way to ensure you have covered every potential hiccup is to get a friend or family member to stay over for a few nights and let them rate you on your room and hosting. There may be some things you have missed in your own inspections.

7. Setting up your account

Now your space is ready for visitors, you can start creating your listing. All you need to do is click on the ‘Host a Home’ option and enter all the relevant details about your room. However, creating a listing that draws visitors in takes a little more effort. You can do this with good photography and a compelling description.

Getting your photography right is a key step. Is the lighting right? Does the room look smaller than it is? Or bigger? Have you managed to highlight any unique amenities you have to offer? Your listing photos will be the main thing potential guests look at and if these are not up to scratch they may not even read your description. If photography is not your thing, Airbnb offers a professional photography service in some areas.

The second crucial step for creating an appealing listing is with a great description. Start by thinking back to the notes you wrote about your ideal guest and the competition in your local area.  Your description should inform people of the important information, facilities available and any unique offerings. Secondly, you want to ensure that it is easy to read, with short, concise paragraphs. Finally, make sure you check your spelling and grammar.

8 . Setting up your calendar

When creating your listing, you will be given the option to fill in your hosting availability calendar. Decide the dates your room will be available for rent and set this out from the start. Remember to keep this updated. You do not want to have to cancel bookings because you forgot to block out the weekend your in-laws are coming to stay!

If you list your property across multiple platforms such as HomeAway and Booking.com then consider syncing your calendar so that you do not overbook by accident.

9. Create your T & Cs

Having people stay in your property can seem like a daunting experience, which is why you should always ensure that you have any terms and conditions and house rules in place before you start accepting guests into your home. Setting boundaries is important but also make sure they are reasonable. If your rules are perceived as being over the top, your guests may choose to ignore them anyway.

10 . Promote your property

If you are serious about Airbnb hosting, or you have already set up your listing but are struggling to get bookings, it may be worth promoting your listing across other platforms. You can promote your listing on Facebook, Google and LinkedIn to showcase your property. Not only will this increase the likelihood of your place being seen, it is also a great trust marker for potential guests, by showing them you are legitimate and not a scammer. Consider also listing your property on other hosting sites such as Booking.com and HomeAway.

11 . Think about tax

Whether you intend to do Airbnb as a full time job or a side venture, it is essential to check how your tax might be affected. If you are just renting out a room in your house, the Rent a Room Scheme allows you to earn up to £7,500 a year tax free. Alternatively, if you own the property that you are renting, you can choose to deduct expenses and have the first £1,000 that you earn tax free instead. If you plan to rent out your property commercially as a holiday let for the majority of the year, your property may qualify as a furnished holiday let. If you find tax confusing, it may be best to consult with an accountant or HMRC if you are not sure what is the best option for you.

How Airbnb protects its hosts.

Estimated Read: 10 minutes

Unlike some platforms, Airbnb does offer some level of protection for hosts if something happens at their property. Solely relying on Airbnb if something goes wrong however could put you at risk. We discuss what they offer, what they might not cover and how you can protect yourself.

What does Airbnb cover you for?

Airbnb offers two types of protection free of charge to all of its hosts. One of these is the Airbnb Host Guarantee and the other is its Host Protection Insurance Programme. In essence, the Airbnb Host Guarantee covers damage to the hosts’s property. By contrast, the Host Protection Insurance Programme covers liability claims where the guest or another third party (e.g. a neighbour) brings a claim against the host, such as where the host is sued for something that went wrong.

What kind of things does the Guarantee Cover?

The Host Guarantee is designed to cover claims where the damage caused by your guest exceeds your security deposit or in cases where there is no security deposit listed. The level of potential cover offered is up to $1 million (or the UK equivalent) of property damage. An example of where you might claim could be where a guest accidentally damages something in your property.

What the Guarantee doesn’t cover.

Airbnb also clearly lists several things on its website that it does not cover, including:

  • Wear and tear. This is also likely to be excluded by insurance companies (including Pikl) but it is important to note that that if you have several guests stay at your property over the course of the year then the chance of damage caused by wear and tear may increase. It is important to keep your property maintained.
  • Valuables. Ideally, you should keep any valuables outside of the property or locked away if that is not possible but if that’s not something you can or want to do then bear in mind it could be excluded from their Guarantee. For a full list of what is excluded, check out their website.
  • Personal injury claims. This is covered by Airbnb’s Host Insurance Protection Programme.
  • Shared or communal areas. You may not be covered if the guest damages a shared or communal area that is not part of the listing.

The above is easily found on Airbnb’s website. However, when you look further into its terms and conditions, there are a whole raft of potential exclusions woven that may limit what you can claim for.

The Guarantee is not an insurance contract.

This is stated explicitly in its terms and conditions. This means that unlike an insurance contract, you cannot complain to an insurance regulator such as the Financial Ombudsman if something goes wrong. If you need to make a large claim and you are not covered by your home insurer (more on this below), you may need to pay for any damages out of your own pocket if Airbnb refuses to cover any damages.

The process for claiming is not straightforward.

Before you make a claim, you will be required to resolve the dispute with the guest first. This may not be appropriate for every case, such as where criminal activity has occurred. You also have a short window where you are allowed to claim.

Contrast this with insurance cover. With an insurance company, you may have to submit evidence but you will be unlikely to have a short deadline (many will give you up to 180 days). You will not be required to resolve the dispute with the guest directly first either.

Unclear terms & conditions.

There appear to be several potential exclusions and the wording is not always clear.

A good example of unclear wording is the stated $1 million worth of property damage cover. The $1 million cover is actually worldwide cover for every Airbnb host, not $1 million per property. There are thousands of Airbnb hosts and this means you are probably covered for significantly less than many people may realise.

Another potential minefield is a clause stating that Airbnb will be ‘entitled to exoneration’ if the property covered or the ‘risk associated with that property’ changes materially. How something is deemed as a ‘material change’ is unclear.

What does Airbnb Host Protection Insurance cover?

The Airbnb Host Insurance Protection Programme covers hosts for up to $1 million for liability claims brought against the host. Potential scenarios where you may need this type of cover could be where a guest is injured, holds you responsible and decides to take legal action against you. Or maybe your guest accidentally damages your neighbour’s property and the neighbour takes action against you. Without liability cover, you may have to pay for any legal costs and subsequent damages yourself. Unlike the Guarantee, Airbnb’s Host Protection insurance is an insurance contract and it is great that Airbnb offers this cover free of charge to all of its hosts.

What Host Protection Insurance doesn’t cover.

Despite being insurance there are still some limitations as to what you will be covered for. It’s important to be aware of them so you know what to expect if a claim was made against you.

Loss of earnings.

If you lose income as a result of your property being damaged due to a guest related claim, you will not be able to use this cover to claim any potential future earnings you may have lost as a result of a claim. You would typically need legal cover elsewhere to claim for something like this.

$1 million cover may not be enough.

You will get up to $1 million cover per listing if you are an Airbnb host. This may seem like a lot. However, if a guest has a serious, life changing injury then the potential damages may exceed this. Imagine that your guest is young and has a lucrative career. If they earn a decent wage, have 30 or 40 plus years of work ahead of them and require lifetime care, it is quite easy to see how the cost of a claim could exceed $1 million. If you were unlucky enough to have a large claim made against you by your guest or a third party, you may have to pay thousands of pounds out of your own pocket if Airbnb is not prepared to cover any damages above $1 million.

Won’t my home insurer cover me?

You may be thinking that your home insurer will cover you for Airbnb related claims. However, based on our research, most home insurers do not cover Airbnb or similar platforms. Most landlord insurance policies do not provide adequate cover either. If your property is covered by a holiday home or second home insurance policy, you may want to check that you are covered for claims caused by paying guests staying at your property.

How specialist insurance can help.

Many standard insurance policies are not designed to provide adequate cover for paying guests, which is why you could be at risk if you listed your property on Airbnb. A dedicated insurance policy on the other hand can fill this gap in cover.

Pikl provide specialist insurance for short-term letting, including cover for properties that are let out on websites such as Airbnb and holiday homes.

If you just need cover for paying guests, you can ‘top up’ your existing cover by taking out one of our policies. This can include:

  • Public liability cover including cover for guest accidents involving bodily injury.
  • Legal cover to defend or pursue legal claims against guests.
  • Accidental, malicious damage and theft cover if caused by a guest.
  • Alternative accommodation for you or your guest if your property is being fixed as the result of a guest related claim.
  • Fire and escape of water damage caused by a guest.
  • Loss of keys and replacement locks cover if renting out your entire property.

We can also cover your main home, landlord or holiday home insurance if you want the convenience of having all of your cover in the same place.

If you are not happy with the level of cover provided, getting insurance with us is simple and getting a quote only takes minutes.

Why your home insurer might not cover your Airbnb

Estimated Read: 5 minutes.

Many people are not aware that most insurers do not provide adequate cover for platforms like Airbnb, HomeAway and Booking.com. We discuss this in more detail and how to make sure you have the right insurance.

Airbnb and HomeAway offer some cover

Before we talk what most home insurers do cover, it important to point out that some of the platforms themselves do provide some measure of protection. If you list your property on either of these platforms then you will get some cover if something goes wrong. However, the protection offered is limited and is no substitute for a dedicated insurance policy. Our article for HomeAway and Airbnb discussed this in more depth if you are interested in what they offer.

How does home insurance work with Airbnb?

We surveyed 90%** of the UK’s property insurers and asked them how they would react if they found out a customer had listed their property on Airbnb or similar platforms.

All of the insurers we spoke to confirmed that they would not cover Airbnb, HomeAway or similar platforms automatically unless their customers had disclosed this beforehand. If you have not already told them that you are using your property as an Airbnb, your insurer may not cover your claim if something goes wrong. Over half of insurers said they would not provide any specific cover for Airbnb even if their customers told them they were doing this. That could mean no cover for things like:

Deliberate damage caused by a guest.
Theft by a guest with no forced entry (e.g. if you let the guest into your home).
Accidental damage caused by a guest.
Legal liability (e.g. if a guest is injured and holds you responsible).

Some insurers even confirmed that they would cancel their customer’s policy altogether if they found out that they were letting paying guests into their home. If you contact an insurer, they may recommend a business insurance policy (such as insurance for running a professional bed and breakfast). However, for customers not doing such businesses full time, these types of insurance policies may be expensive. They may also burden you with unsuitable terms and conditions such as health and safety regulations. These policies may also not offer adequate cover for things like the like the personal contents in your home.

What insurance do I need for Airbnb and what does it cover?

Attempting to get cover by ringing round insurers or using comparison sites is tricky as the cover offered by each provider is varied. 86% of insurers we spoke to said they did not take any specific steps to educate their customers about using Airbnb or similar platforms. That means that the only way to find out what each insurer offers is by writing down a list of the things you want covered and contacting each insurer to ask if they cover them. Not ideal if you do not have a lot of time on your hands. Luckily, we did a mystery shop of some well known insurers and brokers to give you an idea.

On the table above, the left hand side lists the kinds of things you may expect an insurer to cover you for if you listed your property on these platforms. For example, if you let a guest into your home and they stole something from you, this would be classed as ‘theft without forced entry’ as the guest did not need to break into your house to steal something. If you have at look at what each insurer said they would cover when we spoke to them directly however, you can see that many insurers were not prepared to cover anything at all. Some insurers were prepared to cover some things and not others. Calling round home insurers to get adequate cover is not straightforward, even if they say they offer specific ‘Airbnb insurance.’

I’m an running an Airbnb. What could this mean for me?

Your insurer may cancel your policy or stop your claim if they find out that you have not told them. If you have told them that you are hosting on Airbnb, you may want to ask if there is anything that they are not currently covering you for. Insurer policy wordings are regularly updated and it is best to contact them directly in addition to checking your documentation. If you have not already checked this out, you could be risking £1,000s worth of damage if you need to make a claim and are not covered.

How to stay protected.

It’s important you speak to your existing insurer first to find out if they will cover you. Write down a list of things that are important to you or that you would typically expect to be covered for before speaking to them. If you are not happy with the level of cover you are getting, you may want to consider speaking to a specialist broker such as Pikl that can cover you for this.

How specialist insurance can help

A specialist insurance policy specifically designed to cover your for platforms like Airbnb, HomeAway and Booking.com may give you more peace of mind and may be able to give you a higher level of cover so that your property is covered. Pikl insurance has been specifically designed to cover you for things like this.

Pikl provide specialist insurance for short-term letting, including cover for properties that are let out on websites such as Airbnb. If you already have insurance elsewhere, we offer a ‘Top-Up’ insurance policy. Your insurer can still continue to cover you whilst our cover can insure your home for any claims caused by your guests. You will need to let your insurer know that you are intending to do this but alternatively, we can also cover your home as well as cover for your guests. Our insurance for when you have short-term guests can cover you for:

  • Public liability including cover for guest accidents involving bodily injury.
  • Legal cover defend or pursue legal claims against guests.
  • Accidental and malicious damage by a guest.
  • Theft or attempted theft by a guest.
  • Alternative accommodation for you or your guest if your property is being fixed as the result of a guest related claim.
  • Fire and escape of water damage caused by a guest.
  • Loss of keys and replacement locks cover if renting out your entire property.

Getting cover with us with easy and relatively straightforward. We know that the world of insurance can be confusing. If you have any queries, our UK based team will be happy to help.

Do you manage other Airbnb properties?

If you are a company that manages multiple Airbnb properties for clients, offering insurance as part of your service offering can help you attract more business. If this applies to you, check out our page for businesses to see more regarding what is on offer.