- Because your home is your castle
- Because the damage from short term renting can be expensive
- Because putting it right without insurance is a nightmare
Renting out your home for a weekend may be a tempting way of making some money out of your property BUT you might want to think again….
As you can see from the link to a newspaper article from last year it all went terribly wrong for a homeowner in the upmarket Chelsea area of London.
£445,000 worth of damage to the property, used for a party venue for 500, took several months to repair and was not fully covered by Airbnb.
Any research will bring up similar horror stories including homes being used for drug dealing, raucous hen and stag venues and organised theft of contents.
To make matters worse, many homeowners are unaware or simply ignore the necessity of informing their insurer of the situation.
When we are asked about the impact of very short term letting on home insurance our advice is always to make sure the insurance company is aware of your plans. Failure to do so could invalidate your insurance. Many insurance companies will, understandably, be cautious of these arrangements and may either decline cover or impose additional terms which can include exclusion of theft and malicious damage. This can be a big risk to take as support from rental websites is not always forthcoming should the worse happen.
In contrast, renting your home for a longer period (6 months or more) carries fewer risks provided you take the right steps to minimise potential pitfalls. Using a registered letting agent who will not only vet your tenant but carry out financial checks, obtain references and draft a legally binding tenancy agreement gives you a lot more security. Whilst there are costs attached to using a reputable agent you will reap the benefit from the peace of mind this brings. Again, your insurance company must be notified but they are likely to be far more receptive to this type of renting. This is an area that we specialise in so if you would like to discuss this further with our team of insurance specialists…..