Short stay rentals may void insurance
RACQ has warned members that earning extra income by renting out their home while on holidays may be putting their financial future at risk.
RACQ spokesperson Kirsty Clinton said more than 140,000 householders and investors were expected to list their homes on short stay rental sites over summer yet many were unaware they may not be covered by their home and contents insurance.
“It might seem like a great idea to offset the cost of your holiday by renting out your home while you’re away, but you need to do your homework first,” Ms Clinton said.
“Make sure you talk to your insurer and find out if your policy covers you while someone else is staying in your home.
“As you’re earning an income from the activity, it may be classed as a business and therefore impact your policy.
“If a guest damages your property or hurts themselves while staying there, you may find yourself liable for costs you believed would be covered by your policy.”
The Insurance Council of Australia’s Lisa Kable warned commercial use of residential properties increased the risk of incidents occurring in the home and owners should check their policy before listing on rental platforms like Airbnb or Stayz.
“Owners may not realise most insurers regard short-stay holiday rental as a commercial use of the property because the likelihood something will go wrong is higher,” Ms Kable said.
“A home building or contents claim incurred while a property is being rented out may be declined, leaving the owner financially vulnerable to financial loss and other liabilities.”