- Vacation rental market is booming, providing ample opportunities for insurance providers such as InsuraGuest
- Vacation rental owners need to clearly determine what kind of coverage they need, including things that conventional insurance doesn’t typically cover
- InsuraGuest’s InsurTech platform covers different kinds of events, ranging from damage to rooms to lost items to accidental medical and death or dismemberment
Vacation rental is a lucrative business – there’s no disputing that. Vacation rental startups attracted nearly $100 million in venture capital funding in the first quarter of 2016, and the number of vacation rental users globally is expected to soar to 361 million over the next five years. Yet, vacation rental comes with certain risks, as does any investment. Here are three things every rental manager should know to stay safe.
- Not All Rental Policies Are Created Equal
The policy you should choose as a vacation rental manager normally depends on what kind of coverage you need, what type of property you own, and how you intend to use it. Unneeded or excessive coverage will ultimately cost you more, which will damage your bottom line.
- Conventional Insurance Doesn’t Cover All Damage
Even the most careful guest can incur damage to your property, and vacation rental insurance will reduce the cost of repair and replacement. Some insurance policies will reimburse part of your lost income if the property becomes unusable due to damage. Major platforms like VRBO and Airbnb provide only primary coverage, which unfortunately doesn’t extend to all types of damage.
- Homeowners Insurance vs. Vacation Rental Insurance
These are not the same thing. Homeowners insurance covers expenses incurred by damage to your main residence. It won’t cover damages to the property or accidental medical expenses for your guests when it is being rented out. Vacation rental insurance covers damage when your guests occupy the premises.
An example is InsuraGuest Inc.’s proprietary InsurTech software platform, which protects guests during their stay at vacation rental properties and hotels. The Guest Protection Policy is extended to each individual guest at the time of check-in until check-out.
InsuraGuest markets this insurance product to hotels and other vacation properties in an attempt to fill an existing gap in travelers’ insurance. Conventional insurance fails to cover the full scope of risks that travelers and hotel or property owners face. The guest may have no claim to coverage at all in cases where damage or an accident cannot be attributed to the property directly.
The Guest Protection Policy provides specific coverage for such things as accidental damage to rooms, lost or stolen items, medical expenses, death or dismemberment (http://ibn.fm/3ExVA). InsuraGuest is working on expanding the scope of its platform and insurance products to cover European Union member states and the United Kingdom, with plans in motion to launch on the Asian market by mid-2020 (http://ibn.fm/GVHrM).
The European and Asian hotel markets are significantly larger than the U.S. market, holding a combined 5.4 billion hotel nights stayed in 2018, compared to 1.1 billion stayed nights in the United States. With distribution in Europe and the United States, InsuraGuest’s combined demographics will total 3.9 billion nights stayed, and will more than double its vacation rental opportunities.
Do Your Research
It can get exhausting to research policies and companies, but it pays off. Try to narrow your options down to two or three. Each will have advantages and disadvantages, so it may be even harder to make a decision. Still, remember that failing to invest in insurance carries a high risk. Buying insurance isn’t something a vacation rental manager needs to do frequently. Once you become a member property with InsuraGuest, you don’t need to think about it for the next several years. If you want to rent out your property securely and safely, insurance is a must, and opting for a policy such as InsuraGuest will offer both you and your guests peace of mind.
For more information, visit the company’s website at www.InsuraGuest.com
NOTE TO INVESTORS: The latest news and updates relating to InsuraGuest are available in the company’s newsroom at http://ibn.fm/InsuraGuest