By now, you’ve probably heard of Airbnb, the popular online service which connects guests searching for short-term lodging with property owners willing to rent it out to them. You may have even used it yourself, either as a host or a guest.
For those looking to book temporary lodging with minimal difficulty, Airbnb might seem like a godsend, and in many ways it is. Having started small in San Francisco less than a decade ago, Airbnb has grown rapidly, spreading first across the nation and then worldwide.
Today, Airbnb is valued at $31 billion. It operates in more than 65,000 cities in 191 countries, and claims more than three million global listings. These listings range from basic accommodations to exotic getaways such as castles and igloos.
But as with all types of industries, a reservation with Airbnb can go badly wrong. While the vast majority of Airbnb hosts and guests have their transaction go off without a hitch, this is not always the case… and sure enough, over the past few years, you may have seen a fair number of Airbnb horror stories pop up all over the internet.Free Case Review
These horror stories range from the banal to the bizarre, and often include such lurid themes as drug use, prostitution, wild parties, and major property damage. You can look up “Airbnb horror stories” for yourself if you want a taste of what can happen, or you can just use your imagination… but either way, we think you get the idea.
Part of this is just in the nature of the business. When you invite complete strangers into your house, or go to the house of a complete stranger, you are taking something of an inherent risk. Just about anyone can download the Airbnb app, after all, and even the most well-intentioned guest or host can bring unanticipated risks through mere carelessness.
These problems can happen with any rental. But Airbnb is particularly vulnerable, because it is such a new industry, which causes complications on a few levels:
- For one thing, the laws and legal precedents regarding Airbnb claims are not as well-established as they could be. With every new economic innovation, there is always a certain degree of legal innovation which comes with it, and the legal infrastructure surrounding Airbnb is not yet fully developed.
- For another, the industry is rapidly changing because it is so new, and this can be confusing to consumers. We at Torklaw have encountered a lot of misconceptions when dealing with Airbnb cases, and this is not surprising at all. Most of what we are writing about here is only a few years old, and may change again in the near future.
Does this mean that you should forgo using Airbnb entirely? Hardly. The platform can still provide a lot of benefits, but you need to be prepared for the worst. Whether you are a guest or an owner, you should know what to do if something terrible happens in an Airbnb rental.
It is partly because of all the misconceptions and confusion surrounding the issue that we are writing this piece. Hopefully, it will clear the air somewhat and make it easier for you to know what to do if you encounter a serious problem in an Airbnb property.
Types of Problems in Airbnb Rentals
Now, a lot can go wrong in an Airbnb rental. But most of the possible problems can be divided into two general categories:
Bodily Injury. This involves some sort of physical injury, whether mild or severe, which occurs in an Airbnb listing. Typically, bodily injury claims are filed by guests against hosts or landlords.
Property Damage. This involves some of the property in an Airbnb listing being destroyed, damaged, lost, or stolen. Typically, property damage claims are filed by hosts against guests, although hosts who are themselves tenants of the property may also be held accountable for property damage by their landlords.
These are two fundamentally different problems, and should not be confused with each other. However, in this article we will address both.
Accidents which occur in Airbnb residences can cause all sorts of injuries. These can include cuts, bruises, broken bones, sprains, concussions, injuries to the face, disease, and more. Although rare, injuries caused in Airbnb residences can lead to death or serious, lifelong complications, such as quadriplegia, but other injuries which are less severe can still cause major inconvenience to the victim.
How do these injuries occur? There are a variety of ways. Some may be simple slip and fall cases, or may involve the collapse of a roof, staircase, or other part of the building. Other injuries and illnesses may be caused by less obvious factors, such as the presence of bedbugs, asbestos, or dangerous bacteria. Intentional violence, including sexual assault, can also occur in Airbnb rentals.
Most of these claims would be covered under premises liability law, a subset of personal injury law. Premises liability law is based on the notion that premise owners have a duty to all lawful guests on their property to remove any hazards which may cause an injury.
Of course, not all injuries which occur on the property will be the fault of the premise owner. Sometimes, the injury was simply the guest’s fault. But if the property owner creates a hazard, or knowingly allows a hazard to exist without doing anything about it, they may be liable for any injuries which are caused by that hazard.
There are a few different classes of guests on a property, and not all of them have the same legal status. However, Airbnb guests are generally considered “invitees” under the law, which means that they have a fairly high degree of legal protection.
Property damage in an Airbnb rental, just like injuries, can come in all sorts of forms. A guest may do any number of different types of damage to the rental, including damaging the walls, fixtures, windows, floors, furniture, or appliances. This damage can affect either the building itself, or the objects within the building.
Insurance Options Which Don’t Work for Airbnb
Okay, let’s start from the host’s perspective. Let’s say that you rented out your Airbnb to a guest for the weekend, and came back and found the place trashed. What do you do? What insurance policy covers you in this instance?
Well, your first impulse might be to use your homeowner’s insurance policy, if you have one. But you shouldn’t expect homeowner’s insurance to cover damages caused by an Airbnb guest.
You see, all major homeowner’s insurance providers have a rental business exclusion written into their policies. This provision excludes business activities, including renting out your property to paying guests. Some policies might allow you to rent out your home exactly once before the rental business exclusion kicks in, but this isn’t sustainable if you want to be an Airbnb host long-term.
The rental business exclusion might sound harsh, but it makes sense from the insurer’s point of view. When an insurer provides you with homeowner’s insurance, they have to know what they’re getting into. If you start allowing guests into the house, this changes the deal by adding a whole new risk factor. Your insurer doesn’t know who the guests are, so they can’t be expected to assume this risk for nothing!
Of course, you should check with your homeowner’s insurance provider, just to be sure. In fact, you should do this in any case if you are an Airbnb host, to avoid the possibility of being dropped from your policy entirely if they find out later. We can’t speak to your specific policy without knowing the details, but most likely, your insurer won’t cover damage done by Airbnb guests.
So what’s the next option? Well, most major hotel chains, and other full-time hospitality providers, have special business insurance that covers damages caused by their guests. But this insurance is very expensive, and as a casual Airbnb user, you can be forgiven for not wanting to spend such a vast sum.
Fortunately, Airbnb does offer a few guarantees to its hosts, and one of these is Host Protection Insurance.
Airbnb Host Protection Insurance
Airbnb’s Host Protection Insurance, the basics of which you can read about on their website, is designed to protect Airbnb hosts against third party liability claims. These include bodily injury claims, which may be filed against hosts by guests, and property damage claims, which may be filed against hosts by landlords. The policy covers all claims of up to $1 million.
Host Protection Insurance applies automatically to any hosts who list their property with Airbnb, so if you’re a host you’re automatically covered. You don’t have to do anything special, or fill out any paperwork, to get it. Host Protection Insurance also provides primary protection, which means that it kicks in immediately after an accident, so you don’t have to exhaust any other insurance policies before turning to Host Protection Insurance.
You might think this sounds like a pretty good deal, but don’t be so sure! There are a few exceptions to Host Protection Insurance, and you should be aware of these before renting out an Airbnb listing.
First of all, the property damage part of Host Protection Insurance does not cover all property. It only covers building property, which means the building itself. It does not cover damage to any personal property within the building, such as furniture. This is an important distinction, so be aware of it!
Exceptions to Airbnb’s Host Protection Insurance include:
- Intentional violent acts such as assault and battery, including sexual assault
- Pollution, asbestos, lead, mold, bed bugs, or bacteria
- Product liability
- Car Accidents
- Natural disasters such as earthquakes or floods
Some of these will probably come as no surprise to you. For instance, you probably didn’t expect Airbnb insurance to cover a defamation case. Others, however, might be more relevant to your situation.
Airbnb Host Protection Insurance is not available in every country in which Airbnb has listings, but it is available in the United States. Even in the United States, however, there may be some minor differences between states. For instance, most states allow hosts to file claims of up to $1 million at multiple locations, so long as the aggregate does not exceed $10 million, while the states of New York and Illinois have a limit of $1 million per host. These differences may have a big impact on your case, depending on where you live.
What can you do to make up for some of these gaps in Host Protection Insurance? It may help to check with your own homeowner’s (or renter’s) insurance provider. They may have some resources to help you, including offering some sort of supplemental insurance which might help to cover these gaps.
It may also be useful to talk to an insurance broker, whether in person or online, to see if you can find any sort of supplemental insurance policy. An in-person insurance broker also has the added benefit of being able to walk you through the process, and explain any local laws which might apply to you.
Airbnb’s Host Guarantee
Host Protection Insurance isn’t the only type of coverage offered by Airbnb. The company also offers a Host Guarantee, which can also be found on their website.
The Host Guarantee is technically not insurance, although it does promise to protect you if you are an Airbnb host. It is a guarantee that Airbnb will compensate any property that is damaged or destroyed by an Airbnb guest, for up to $1 million.
Now, this might also sound like a great deal… but as with Host Protection Insurance, there’s reason to be cautious and not take Airbnb’s promises at face value. After all, $1 million is a lot of money, even for a big company like Airbnb. They wouldn’t promise that if they intended to pay that out all the time.
There are a few exceptions to the Host Guarantee, although these exceptions are different from the ones involved in Host Protection Insurance. And the policy is fairly complex and gives Airbnb a lot of room to drag things out, frustrate you, and play games which may still ultimately lead to the denial of your claim.
Although Airbnb promises the moon with its Host Guarantee, a lot of actual Airbnb clients who have been forced to deal with the process end up leaving without a single moonbeam. They tell stories of red tape, inattentive claim handlers, negligible compensation, and more.
All in all, the Host Guarantee can come in handy, but you shouldn’t take it for granted, and you may need legal help to give Airbnb the necessary prod to make it actually live up to its stated promises.
Airbnb Security Deposits
The final ways in which Airbnb property damage claims can be dealt with is through a security deposit.
Airbnb hosts have the option to add a security deposit to their listening when renting it out. (Unlike with some of the protections listed above, the security deposit is not automatic, and you will need to proactively add it to your listing.) If a guest damages some property in your listing, then you may request compensation for the damaged property from your guest.
Of course, your guest may refuse, and then you will have to get Airbnb involved to resolve the dispute. Unfortunately, as with some of the other types of coverage, Airbnb is hardly infallible, and they may not treat your claim with the concern that it deserves.
Nonetheless, the security deposit is a good way to deal with minor property damage claims, and if you are concerned about protecting your property, then you should certainly add a security deposit to your listing.
Steps to Take in an Airbnb Case
- If you have been injured in an Airbnb rental, then the very first thing you should do is seek medical attention for your injuries. This always, always comes first. Your personal health is important… but even if that doesn’t sway you, keep in mind that medical records are often the most important evidence in a personal injury case, because they show that you were injured. If you don’t have proof of your injuries, then Airbnb will likely deny your claims.
- The next step you should take, assuming you are not too badly injured to do so, is to collect evidence. Take some pictures of the scene of the accident, including your injuries themselves and the hazard in the Airbnb rental which may have caused them. Try to get pictures from a few different angles, if possible. Also, get the contact info of any witnesses who may have seen the accident (assuming you do not have it already). Witnesses and pictures are both very important.
- The next thing that you should do is file a claim with Airbnb. Other than this, however, don’t say anything on record, either to the property owner or to the Airbnb host! Insurance adjusters, as in any other type of accident situation, are not your friend, and Airbnb does not have your best interests at heart. They don’t want to pay that $1 million policy if they can avoid it. Instead, hire a personal injury lawyer, and let that lawyer do the talking.
If you are an Airbnb host dealing with a property damage claim, your situation will be slightly different. Of course, you will not have to see a doctor, but you should still get as much evidence as possible. Next, you should try to file a claim with Airbnb. If they are not responsive to your claim, then that’s the time to bring legal representation in. They’ll think twice about giving you the runaround once they see that you’ve hired someone who knows how to fight!
Hiring a personal injury attorney might seem like a big step for an Airbnb case, and especially a minor one. Some trivial cases might be resolved without legal representation, but consider this: when it comes to resolving these sorts of claims, you are likely in over your head. Your knowledge of the law cannot compare to that of Airbnb, or their insurance adjusters.
You probably use Airbnb in large part because you value its convenience. If so, know that there is nothing more inconvenient than the process which they put you through in the event of a claim, whether it involves injury or property damage. In fact, this is probably part of the reason they do that. They know that you don’t have much time to pursue the claim, and they hope you’ll just give up in despair!
Even the act of contacting Airbnb can be difficult. You might think that all you have to do is call Airbnb’s help number, but it doesn’t stop there: they’ll make you sign up online, call back again, and so on… all just to be heard. Filing the actual claim is much harder. Like a lot of companies, Airbnb talks the talk when it comes to consumer complaints, but does not really walk the walk.
No matter how bright you may be, you are likely an amateur when it comes to legal matters. That’s not a judgment; you probably have a million other things on your mind. Airbnb’s insurance adjusters, however, have only one thing on their mind, and that is finding ways to deny your claim.
This is why the best thing you can do is outsource your advocacy to an attorney and let them take on the stress of the case for you. If you are injured, then this becomes especially important, because a stress-free convalescence is the most optimal scenario for your long-term recovery.
Torklaw is a personal injury law firm dedicated to representing plaintiffs in difficult personal injury cases, including catastrophic accidents. We represent clients on a contingency fee basis, and have extensive experience filing claims against Airbnb and similar firms. If you have suffered any bodily injury OR property damage in an Airbnb lodging, whether as a host or guest, then give us a call today and set up a FREE consultation. We’ll start figuring out what we can do for you.