Got Airbnb? You might want to check your insurance

'Tis the season for tourism to be jolly, but Airbnb hosts should check they are neither over- nor under-insured. 

There is every indication that this year's holiday season is likely to be an improvement on last year's, particularly for the Western Cape, which was hit by severe water restrictions in 2017.

By contrast, Fin24 reported that travel and tourism is forecast to contribute more to the South African economy in 2018 than in any other year, according to new research released by the World Travel & Tourism Council (WTTC).

Quarterly figures from September show that direct foreign spend was up by 8.8% compared to last year, with the length of stay increasing by 6.6% and the number of bed nights increasing by 13.8%.[1]

All this is great news for guesthouses and Airbnb users. But owners of such establishments should also remember that with increased traffic comes increased risk and increased responsibility. And this means taking care of insurance and liability.

The guests are all right

There are several issues to consider when it comes to the safety of your guests. Naturally, it's impossible to foresee every eventuality, but broadly, injury or death suffered by a guest is something you should be covered for.

Anything from a guest falling down a flight of stairs to the aftermath of a home invasion could have implications for you, so it's worth giving your insurer a call to discuss your needs and whether you are correctly covered.

Where guests' possessions are stolen, insurance will usually only pay out if there are signs of forced entry, so make sure that you take the necessary security measures to try to ensure the safety of your guests (and their property).

You've got 99 problems…

Of course, it isn't only your guests' property that is at risk.

When you open your home to others, you run a risk that your own property may be damaged, or even stolen. (Yes, it does happen.) The question is whether you are covered for this.

Alternatively, there is also the possibility that your premises may be damaged by fire or some other accident, and need repairing.

In this case, beyond the cost of the repairs, you'll also find yourself carrying the cost of lost income.

You fought the law, and the law won

A major potential issue for property owners is falling foul of the law.

It's essential to ensure you are not found to be contravention of applicable zoning or health and safety regulations.

The hospitality industry is regulated and with the growth in “informal” tourism through the likes of Airbnb. Overseas, cities have already begun to implement rules for the short-term rentals market. Even where those do not exist, hosts must comply with requirements such as adequate fire protection. Non-compliance would affect the validity of your cover.

Honesty is the best policy

The best advice one can give to the owner of a guesthouse or Airbnb-registered property is to sit down with their insurer and understand exactly what their current policy would cover and what options suit their needs and pocket.

Once you have decided on the correct cover, provide guests with a written summary of what is covered and what is not, in terms of your insurance.

Bear in mind that insurance cover is typically subject to the proper use of alarms, too. Your visitors may not know how to use your alarm, so if need be, provide them with a comprehensive, easily understandable set of instructions about how the alarm works and why it is important.

If your instructions included more wide-reaching security tips aimed at helping your guests stay safe when outside your premises, so much the better – and you will be well on your way to another excellent Airbnb review.

Christiaan Steyn is Head of Business Insurance at MiWay, a licenced short-term insurer and financial services provider.

[1] Department of Tourism, “Tourism factsheet: Quarter Two South African Tourism Performance” (11 September 2018), available at

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