Airbnb currently boasts more than 2 million home rental listings in 34,000 cities throughout 191 countries. HomeAway is close behind with 1.2 million in 190.
That’s more lodging than any hotel chain in the world.
But while the enormous popularity of home sharing is undeniable, at least one aspect of the disruptive trend poses major concerns: insurance coverage—or lack thereof.
What’s the Problem?
When homeowners or renters head to a home-sharing website to rent out their homes in exchange for income, “most probably don’t think through the fact that they’re beginning to engage in a commercial endeavor,” says Bill Furlong, HomeAway’s head of North America. “When they do that, there are a whole bunch of things they have to check off the list. They have to check local regulations, they have to think about the tax part of the equation and they have to make sure the insurance is covered.”
That insurance piece is trickier than most consumers realize. “Generally, home insurance covers your property, and it’s pretty broad coverage,” says Laurie Pellouchoud, vice president, Allstate property line management, whose company recently released a home-sharing endorsement called HostAdvantage. “But when you have people renting out their home or space in their home, there are some gaps in coverage that generally exist with regards to your personal property.”