With share culture catching on, there’s been an uptick in private pool rentals. Pool-sharing apps allow homeowners (hosts) to rent out their pool space to people (guests) by the hour. The companies behind these apps offer insurance to their hosts and position their insurance as a coverage boon. But the age-old insurance question remains: What could go wrong and will insurance cover it? Before you dive into pool sharing, check your homeowners insurance.
What could go wrong?
The short answer is people can go wrong. While the lure of making money for unused space sounds intriguing, the sobering reality of liability exposure can be a deal breaker. As with most host apps, you control the pricing, hours and rules of engagement. But for all you can control, there’s a lot you can’t — like human behavior.
A pool-sharing rental gone awry
You rent out your backyard oasis on a popular pool-sharing app. After a guest rental, you return home to find your grill and furniture in the pool, empty liquor bottles scattered across the deck, and holes in your house siding. You call the pool-sharing app immediately to report the incident and share the video proof of the obvious damage. The pool-sharing company starts the first step in their claims process — they contact the offending guests to settle the cost for damages. They’re unsuccessful at making contact and the credit card on file is canceled so there’s no way to retrieve payment. The pool-sharing company passes your claim to the insurance company that handles host policies.
The pool-sharing insurance policy questions the timing of the damage and suggests the guests could have committed the vandalism after their rental time expired. They note numerous liquor bottles in the video you provided and suggest alcohol was also involved. They deny your claim because they only respond to claims that occur during the booking period and they don’t cover losses arising from the consumption of alcohol. You didn’t witness the incident and you have no proof other than the video you provided hours after the incident.
You file a claim on your homeowners policy only to discover they have exclusions related to property rented for business purposes. The claim is denied.
The only option you have left is to sue someone or eat the cost of the damages.
Insurance is not created equal
Some insurance exists to not exist. Even though some pool-sharing apps advertise an all-inclusive “don’t worry about it” insurance approach, you actually should worry. Consider this excerpt about the insurance offered by one pool-sharing app:
“If you have insurance that may cover some or all costs arising from an injury or damage arising during a reservation, such as your health insurance or homeowner’s insurance, you should file a claim under that policy before seeking reimbursement.”
The takeaway is to not file a claim because the pool-sharing company’s million-dollar policy won’t respond. Here are more examples of what’s not covered on host policies:
- Injuries or property damage outside the times of a paid booking
- Injuries or losses arising from the consumption of alcohol
- Injuries related to swings, trampolines, bounce houses or inflatables
- Injuries related to fire pits, fireplaces, outdoor heaters or patio heaters
- Injuries to your pets or caused by your pets
- Injuries arising from intentional acts (assault and battery, sexual abuse or molestation, identity theft or fraud, etc.)
- Injuries arising out of acts of nature (pollution, earthquakes, weather-related events, etc.)
- Injuries arising out of communicable diseases, bacteria or microorganisms (including recreational water illnesses)
- Losses arising from theft or stolen property
- Losses reported later than three days
- Losses without sufficient proof (there are no criteria on proof)
This list of pool-sharing coverage exclusions leaves you wondering if you’re getting any insurance at all (and adds more to the list of what could go wrong).
Protect yourself and know your coverage
Pools can be a high-risk endeavor and the added liability of sharing them might not be worth the extra cash. But if you’re set on renting your pool, take precautions:
- Verify your insurance. Look for coverage with high limits, host liability and no exclusions on home businesses or rentals.
- Obtain a personal umbrella policy. An umbrella can significantly increase the limits over your home and auto policies.
- Invest in a quality home monitoring system (360-degree views, time and date stamp, night vision, etc.) for added proof.
- Consult an experienced personal injury and liability lawyer and know your options in case of a lawsuit.
No matter what you decide, protect yourself and your home.
Are you confident that your current insurance will cover damages caused by pool renters?
Do you have a surveillance system set up to monitor renters while they’re using your pool facilities?
Have you checked that your personal umbrella policy will cover any pool-related incidents?
The insurance advisors at JAISIN have years of experience in personal and commercial policies. They can help you decide if you need more coverage while you rent out your pool.
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