Peer-to-Peer Rentals May Be Considered a Business and Require Different Coverage
NEW YORK, Dec. 12, 2013 /PRNewswire-USNewswire/ -- Homeowners looking to score a windfall by renting out their residence to Super Bowl ticket holders next February should first contact their insurer, according to the Insurance Information Institute (I.I.I.)
"Before renting out all or part of your home, tell your insurer about your plans to make sure you're covered if your property is damaged or if someone is injured," said Jeanne M. Salvatore, senior vice president, Public Affairs, and consumer spokesperson for the I.I.I.
The Super Bowl is being held on Sunday, February 2, 2014, at MetLife Stadium in East Rutherford, New Jersey, eight miles west of mid-town Manhattan. The market for properties near the Stadium is booming on peer-to-peer rental websites as New Jersey and New York homeowners angle to receive their own version of a playoff bonus with thousands traveling to the region for the NFL's championship game. Short-term rental prices for homes typically soar when the Super Bowl or other high-profile sporting events come to town.
Some insurance companies may allow policyholders to use their property as a rental for a one-time, special occasion like the Super Bowl, as long as the insurer is informed about it ahead of time. Other insurers, while allowing this type of arrangement, may insist on other criteria being met, such as the homeowner acquiring additional insurance coverage.
Keep in mind that there are some insurers who will consider any rental of your home to be a business venture, requiring the purchase of a business policy—specifically either a hotel or a bed and breakfast policy—because a standard homeowners insurance policy excludes losses arising from the operation of a business.
"Technological advances have allowed for the growth of the sharing economy" said Barry. "But, if you participate, it is your responsibility as a property owner to make sure you're adequately covered."
- Peer-to-Peer Home Rental
- What Type of Insurance Do I Need If I'm Renting out My Home?
- What Is Covered Under a Standard Homeowners Policy?
The I.I.I.'s free mobile apps can help you create a disaster plan, learn about selecting the right insurance for your needs and budget, and create and maintain a home inventory. Learn more about our suite of apps here.
THE I.I.I. IS A NONPROFIT, COMMUNICATIONS ORGANIZATION SUPPORTED BY THE INSURANCE INDUSTRY.
Insurance Information Institute, 110 William Street, New York, NY 10038; (212) 346-5500; www.iii.org
SOURCE Insurance Information Institute