Homeowners renting out their homes to holidaymakers need to check that their short-term insurance policy will cover their possessions during this period.
Dawie Loots, CEO of MUA Insurance Acceptances, says it is vital consumers speak to their insurance provider or broker before they embark on their vacation to ensure that they won’t be left out of pocket during the time that is meant to be stress-free.
“When a homeowner rents out a home to a holidaymaker, it is imperative to have a discussion with the guest prior to arrival to determine what they expect of the occupants,” he says, noting that it has to be decided upfront who will be held liable in the event of a break-in or robbery happening at the premises during the tenants’ stay. “In most cases the homeowner should have sufficient insurance cover in place, but sometimes the occupants will be held responsible for theft or damage to their own goods and will therefore need to ensure they have their own insurance.”
There are many occasions where two or more families rent one home collectively in an effort to save costs. In these instances, each person or family will be responsible for their own personal belongings.
Owners should be clear on communicating the responsibilities on occupiers when it comes to insurance requirements, such as locking doors or windows, as well as setting the alarm before bed or going out. “If the insurance policy clearly stipulates that all doors should be locked and the alarm must be set, the homeowner could face insurance claim repudiations if the requirements are not adhered to,” says Loots.
Homeowners cannot be held liable for the occupants’ negligence. “The homeowner will be in their rights to hold the tenants liable should a burglary occur and investigation proves that the alarm was not set properly,” says Loots. “Therefore, it is imperative that the homeowner and tenants have a serious discussion about insurance requirements and liability before the tenants occupy the house.”
Homeowners’ insurance policies will require visible and forcible entry in order to pay out for any theft while guests are renting the home. “This is why it is a good idea to have a written and signed agreement with the lessee so that they are made aware that they will be held liable for any stolen or damaged items if there are no signs of forced entry,” says Loots.
Homeowners, however, can be held liable for injury on the property. It’s vital to ensure that the property is maintained in a good condition and free of any hazards that could cause injury or harm to the occupants. “Any visible defects in the property must be drawn to the attention of tenants,” says Loots.
Some insurance policies offer cover for the personal belongings of guests, which is a good idea as the homeowner does not want to be held liable for stolen or damaged belongings in the event of a burglary or disaster, such as a fire, says Loots.
“It is advisable that consumers make contact with their insurance broker ahead of the vacation to ensure that they will not be suffering from any insurance blues this holiday, no matter what their arrangements will be,” he says.