With tough border controls limiting the freedom to take holidays overseas and lingering worries about the spread of the coronavirus and its variants, record numbers of Britons are turning instead to staycations.
A story by the BBC at the end of January 2021 related the accounts given by several owners of self-catering UK holiday accommodation commenting on the surge in bookings.
That tidal wave of interest in staycations – and the dwindling volume of available holiday accommodation to meet the surge in demand – has presented novel opportunities for homeowners and owners of second or holiday homes alike.
Your holiday home
If you own a second home, it is now likely to be as highly prized as gold dust by the hordes of staycationers scouring every corner of the hospitality industry for any accommodation that has not yet been fully booked for the foreseeable future.
If you are looking to earn an attractive rental income from visitors such as these, therefore, the demand is most certainly there.
Before you go any further, though, you need to ensure that any second home you own is adequately protected by suitable holiday home insurance
As we explain in our relevant product page, holiday let insurance is different from any regular home insurance you might have arranged; it is different from the insurance you might have bought when it was only you and your family who used the holiday home; and it is different again from any standard form of landlord insurance (where tenants are likely to live in your let property for six months or more, typically on an assured shorthold tenancy).
There are particular risks typically associated with property that is let to tenants on a short-term holiday-oriented basis:
- you may face a higher than usual risk of liability for trips or spills that cause injury to a guest or tenant or damage to their property – holiday let insurance is likely to stress the importance of adequate liability indemnity insurance for you as the landlord;
- there may also be a higher incidence of malicious damage caused by irresponsible, short-term tenants;
- your own personal possessions and the contents of your holiday home may be at greater risk of loss or damage when the premises are occupied by holidaymakers; and
- you run the risk of a significant loss of rental income if an insured event leaves the holiday home temporarily uninhabitable – and unlettable – pending repairs and reinstatement.
As well as providing cover that recognises these particular risks and perils, holiday let insurance may also offer the protection the property continues to need when it is left empty and unoccupied – for potentially long periods during the off-season or winter months, for example.
Taking advantage of Airbnb
Even if you are a regular homeowner but especially if you already own holiday accommodation, you are almost certain to have heard of the widely popular accommodation-sharing platform Airbnb.
Anywhere from a spare room in the home you occupy, a second home or holiday let you might own, or even a bed and breakfast business – all may be advertised on the platform to attract the rapidly expanding market of Airbnb guests.
In a posting in April 2020, we explained that Airbnb hosts might take a crumb of comfort against the risk of damage by unruly or irresponsible guests by Airbnb’s so-called Host Guarantee. This promises up to US$1 million (around £730,000) if your home or your possessions are damaged by a guest or guests.
As Airbnb itself is first to point out, however, the Host Guarantee is no substitute for appropriate landlord or holiday home insurance. Although that guarantee may be in place, it specifically excludes:
- cover for your public liability as the owner and landlord of the property – in common law, you owe a duty of care to any guest, so that, if they sustain an injury or have their property damaged, you may be held liable and ordered to pay a substantial sum in compensation;
- the loss or theft of cash, securities, jewellery, artwork, or collectors’ items; or
- the injury to or even the death of one of your pets caused by the actions or inactions of your guests.
Specialist Airbnb insurance – as a variation of holiday let insurance – is available to safeguard you against such risks.
If you have a spare room in your home or even a second home, by all means take advantage of the current shortage of holiday accommodation and the opportunities offered by the present surge in demand for staycations.
As you look forward to the additional rental income those opportunities might bring your way, however, remember to protect your property and your position as a temporary landlord by arranging suitable holiday let insurance. Don’t forget also, that in cases of letting a room in your home as Airbnb, that you will need to speak to your mortgage provider first for permission.