Nearly 70% of rental hosts buy supplemental liability insurance
On average, property damage occurs during 5% of short-term and vacation rentals.
Many people will be traveling this Thanksgiving week, as Keydata reported adjusted paid occupancy and average daily rates (two indicators of consumer travel plans) are both outpacing 2019 levels.
With vacation rentals rebounding from lows brought on by the pandemic, hosts are showing concern for their property and are turning to supplemental liability insurance to cover potential losses. Generali Global Assistance reported 68% of hosts buy extra liability coverage in addition to what is offered by booking platforms. Further, hosts that have been managing properties for three or more years are 25% more likely to purchase supplemental liability coverage.
This news comes from a recent study by Phocuswright and Generali, which found 5% of short-term rental stays result in property damage. Around one-third of prospective hosts are worried about potential damage when renting a property.
Chris Carnicelli, CEO of Generali Global Assistance, said in a release: “Given the results of our short-term rental study, we found that gross bookings will reach $37 billion by the end of 2021, which is a 52% increase as compared to 2020. With travel on the rise post-pandemic, the amount of vacation rentals has clearly increased exponentially as well.”
Renters want protection too
Short-term renters are not operating without worry either; 10% said they have been motivated to make a rental reservation because the booking platform offered insurance, according to Generali.
More than 40% of renters said insurance is more important to have now than it was before the pandemic. Renters staying at luxury homes and apartments are more than 50% more likely to purchase travel insurance, the study found.
Consumers aged 25-44 are more likely to say insurance is now critical when compared to both younger and older cohorts.
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