Is home-sharing insurance worth its salt?

Is home-sharing insurance worth its salt? | Insurance Business Canada

Is home-sharing insurance worth its salt?
The home-sharing industry is continuing to boom across many parts of the globe – and Canada is no exception.

According to Airbnb, which says it has over 55,000 hosts across the country, 67% of Canadians support allowing local residents to home-share with travellers.

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But while home-sharing is an easy way to bring in some extra cash for many homeowners, it’s been something of a grey area when it comes to what insurance coverage hosts need.

Now, Aviva Canada has announced the launch of a new home-sharing product available to home-share hosts across Canada using platforms such as Corporate Housing by Owner (CHBO), Flipkey, HomeAway, Roomorama, and Airbnb.

The coverage consists of two options – a simple add-on to an existing Aviva homeowner policy, or a standalone policy for those renting out a secondary income property.

Chris Fowler, senior manager of personal lines propositions at Aviva, told Insurance Business that while many home-sharing platforms offer some kind of guarantee, they provide a “limited protection within their scope.”

“They’re basically looking at a time during the rental period and saying, ‘we will cover any damage during that rental period as long as it fits a set criteria,’” Fowler explained.

Aviva’s new offering will provide more comprehensive cover, including coverage for things like criminal liability – if a tenant commits a criminal act at home – and fair rental value – which will cover the host for loss of income if something happens that prevents them renting out the property when they had planned to.

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“We’ve also made it very clear with this coverage that we want to be primary payee, so [insureds] don’t need to worry about contacting Airbnb, HomeAway or any of those companies,” Fowler added.

According to Fowler, many of Aviva’s competitors in the Canadian market still consider home-sharing a commercial exposure – but he anticipates the market is set to grow.

“We don’t consider it a commercial exposure which is why we developed this solution,” he said. “I think that once our broker partners start talking it up more… a lot of our major competitors will fall in line and become fast followers.”

Aviva research found that 51% of Canadians who had rented their home out in the past had no idea that their current home insurance might not cover them – and it’s on this issue that brokers need to focus, Fowler said.

Brokers should help “beat the misconception that some of the guarantees that home-sharing networks offer will be adequate enough,” he said, and clients should be pointed towards tailored home-sharing policies.

“We’ve made it easy for your customers to actually have the coverage they need, so they can easily rent out their home.”

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