According to the Australian Financial Review, there are now 40,000 listings in Australia on Airbnb - the Californian based website that helps people rent out a room, or their entire home to complete strangers. That’s a huge 100% growth in just 12 months.
Protection for hosts
Airbnb’s success is a no brainer. It’s awesome for travelers, who get a huge amount of accommodation options at great prices, and it means that hosts can make money out of their homes. What’s been missing in this win/win is the insurance cover for the hosts.
Innovative new product
Enter ShareCover, an innovative, new product developed specifically to provide insurance for some of the additional risks that can come with renting your home on a sharing economy platform such as Airbnb and Stayz. So what makes this first-to-market new insurance so cool?
Insurance for the sharing economy
Gopal Raman, Project Director, Strategic Initiatives at IAG, who developed the product explains, “It’s insurance for the sharing economy, which we think is here to stay and our customers are participating in. The point is, Airbnb customers are speaking with their feet and it’s growing really fast but insurance has been slow to respond to this point.”
Concerned about damage
“ShareCover came out of customer research and trends that are changing the insurance landscape. Essentially what we found was that while a lot of people were putting up properties on Airbnb and Stayz, they were still worried about damage to their property and the other insight we got, was that more than half of them thought their home insurance would cover it, or weren’t sure if it would.”
Covers hosts for risk
It’s important to point out that ShareCover isn’t a replacement for your standard home and contents policy. It’s intended to cover you for some additional risks associated with having a paying guest – effectively a stranger - in your home. While it happens rarely, things can and do go wrong with these rentals. Property can be damaged or stolen, or someone may be injured while they’re staying and want to sue.
Short term and simple
What’s revolutionary about this home contents and building insurance is, you only pay for the nights you need insurance. Essentially for the nights you actually have guests staying.
How does it work?
First you go online to Sharecover.com and enter your property details to get a quick quote. You can then refine your quote by varying the amount of cover and excess you need.
Once you’re happy with the quote, you can register immediately and purchase the policy.
“It’s very simple. You don’t have to spend a lot of time clicking through a lot of questions. The entire process takes less than 5 minutes. Once you are set-up, buying a new policy is even simpler. You login to your account, a couple of clicks and you are done. We have a lot of repeat customers,” says Raman.
How much does it cost?
The cost of each insurance policy is different depending on level of cover required, number of guests, the length of stay and a few other variables, but according to Raman, “A typical policy costs about $5-10 dollars per night.
We find that many customers add this amount to their nightly rate and pass on the costs to their guests. You get to choose the amounts of buildings and contents cover, but for that average cost you would get around $400K buildings insurance, $80K contents insurance and $10 million dollars of liability if someone hurts themselves on the property.
You can also choose the amount of excess which start at $300 and goes up to $1500. Plus, you don’t have to own the property to buy this product. So even if you’re renting, the owner can be covered for buildings cover."
An add-on not a replacement
The important thing to remember is that ShareCover is not a replacement for standard home buildings and contents insurance because it doesn’t cover you for all risks, such as storm for example, so you still need to have that in place.
What it is; is an easy to use, low cost product that’s changing the face of insurance.
Helping Australians make money
According to Airbnb research, a huge percentage of people use Airbnb to help pay off their mortgage and 85% of Airbnb users rent their primary residence. For Raman, ShareCover means keeping ordinary Aussies safe while they get to benefit from the share economy.
“It meets a need in the market but more importantly, it puts people at ease when they are potentially placing their biggest asset, their home, at risk,” he says.
Find out more about ShareCover here.
ShareCover is issued by Insurance Australia Limited ABN 11 000 016 722 AFS Licence No 227681 trading as ShareCover Enterprises. When making decisions about a ShareCover product, always read the Product Disclosure Statement (PDS). To help you make an informed choice on insurance visit the Australian Government website: www.moneysmart.gov.au.