Munich Reinsurance America, Inc. (Munich Re U.S) has announced that it plans to offer a new personal lines homesharing insurance product for hosts who rent their homes out for a profit in the U.S.
The coverage will help to enhance a personal lines homeowner, renter or condo insurance policy by filling in certain coverage gaps when a home is being rented out.
Munich Re quoted a study from Pew Research showing that 11% of U.S adults have now used homesharing services such as Airbnb, which was used by almost 80 million travellers in 2016, up from 40 million in 2015.
“Homesharing has become a popular lodging alternative for millions of travelers worldwide every day,” said Jason Dunn, Strategic Product Development Manager, Reinsurance Division, Munich Re.
“But typical personal lines homeowner policies weren’t built to provide coverage for the homesharing activities of someone who is involved with more frequent for-profit rentals.“
The Homesharing Coverage Endorsement is a product that can be rebranded and attached to a personal lines homeowners, renters or condo policy purchased through a participating insurance carrier, Munich Re explained.
When attached to a homeowners policy, the endorsement broadens the underlying coverage for dwelling, other structures and personal property to cover property losses resulting from homesharing activity only.
The endorsement provides coverage for homesharing hosts following loss or damage to the insured residence and personal property, as well as liability to others.
Additional coverages include: landlord’s furnishings, excessive use of utilities, hospital and medical expenses, bed bug infestation coverage, homesharing damage to property of others, claims expenses due to homesharing, vandalism to neighbours, and water damage to neighbours
“From the specter of a bed bug infestation to excessive utility usage, water damage to a neighbor’s property or an accidental fall down the steps of the covered dwelling by the homesharing guest, a homeowner/host can face costly property damage or an expensive liability lawsuit when they rent their home,” Dunn continued.
“Munich Re’s new endorsement will help bridge the insurance gap between personal and commercial coverages and provide additional benefits to help address the needs for this commercial risk.”