Airbnb and Premises Liability: What you Need to Know
For today’s internet savvy consumers, booking vacations, car rentals, and virtually all other associated items has become a matter of simply clicking and booking through the internet. Pictures of wonderful vacation rentals by owners and Airbnbs lure consumers into a convenient and attractive option for booking overnight stay needs. While Airbnbs appear to be the way of the future, they do present some interesting issues from both a safety standpoint for renters as well as from a liability standpoint for the owners of Airbnbs renting out their properties to consumers.
Perks of renting an Airbnb
-Often they are more cost effective options than traditional hotels
-The types of accommodations may also be more varied – for example, multiple bedrooms and bathrooms
-Sometimes the terms and conditions available are more flexible than traditional hotels or perhaps the location and other unique features are attractive (for example, cancellation policies, minimum stays, pet friendliness, and so forth)
Downsides of renting an Airbnb
While Airbnbs do offer some unique options as mentioned above, there are some downsides that consumers need to think carefully about when booking Airbnbs for themselves and their family members. With the explosion of Airbnbs, many legal questions arise as to how Airbnbs are regulated, insured, and operated, and whether adequate protection exists for consumers choosing to book their short term rentals through Airbnb. As pointed out below, there are many unsettled legal issues related to Airbnbs in British Columbia.
How does premises liability law apply to Airbnbs?
British Columbia Airbnb Regulations
In British Columbia, there are no requirements at the provincial level for insurance, licensure or the usual types of requirements that hotels and other short term rentals must meet. This raises many concerns for both the industry itself and also the safety and security of consumers who utilize Airbnbs as their preferred rental options.
Local Airbnb Regulations
Some local governmental bodies have begun instituting bylaws and regulations to try to address these concerns. Vancouver, B.C. is one such local government that is beginning to regulate Airbnbs. As of September 1st 2018 all short-term rental operators in Vancouver are required to have a business license in order to operate an Airbnb and are mandated to include their license number in all online listings and advertisements for their space. Violations of these terms can result in fines of up to $1,000 per offence.
Concerns for Airbnb Owners
On the other side of the coin, if the renter does substantial property damage to the property, is the owner adequately protected through the typical Airbnb contract provisions and any insurance available through Airbnb? Due to the lack of regulation of Airbnbs, many of these issues are somewhat unsettled in the law.
In general, an Airbnb guest would be viewed as an Invitee to the Airbnb premises which means that the guest is owed the highest legal duty available in terms of preventing foreseeable injuries to guests on the property. This places a high level of responsibility on the property owner to ensure that the premises is safe and free from any risks that might have been created by negligent behavior on the owner’s part.
Insurance Requirements for Airbnb
While traditional hotels and standard bed and breakfasts must meet certain insurance requirements, Airbnbs do not have this type of regulation. This leads to many questions about what happens if a guest in an Airbnb suffers an injury while staying in an Airbnb. Industries competitive with Airbnb including Bed and Breakfast Associations are pushing for greater applicability of insurance and similar requirements to level the competitive playing field and also for the protection of consumers.
-Consumers renting an Airbnb property should consider whether this is a risk they are comfortable with. For Example, if the consumer suffers a substantial injury while a guest of an Airbnb, is any applicable insurance sufficient to make the guest whole.
-This is significantly different than the requirements for hotels and other regulated guest rental situations.
Building Code and Inspection Requirements for Airbnb
In addition to the lack of insurance requirements for Airbnbs, they are also not subject to building code and inspection requirements like hotels and apartments would be subject to. This would include items such as fire code regulation, electrical inspections and similar items. Therefore, there is no way to ensure that owners of Airbnb properties have properly met safety and building codes with any work that was done on the property. This should be a significant concern for consumers looking to rent properties through Airbnb.
What happens if a guest is injured while staying at an Airbnb?
In light of the discussions above that Airbnbs do not have to meet the same requirements as other short term rentals, what should potential guests of an Airbnb do if they are injured? If you are injured as a guest in an Airbnb, what will your options be? If the owner of the property has proper insurance, it may be that there is an option to make a claim on the owner’s insurance policy for anything not covered by Airbnb’s Host Protection Insurance.
-What if an injury suffered at an Airbnb is disabling? Will there be sufficient coverage to deal with this situation?
-What if there is a death caused by a condition at an Airbnb? This is also a significant area of concern due to the lack of insurance requirements for Airbnbs.
Airbnb offers Host Protection Insurance to its hosts, which allegedly protects against liability claims up to $1 million USD that happen in a listing or on an Airbnb property during a stay, but this too has its selection of limitations. This program claims to protect in the event of bodily injury or property damage, but doesn’t cover anything if it’s considered property damage due to things like pollution or mould, damage or injury from something done intentionally, or any loss of earnings whatsoever.
What happens if a guest causes substantial damage to the Airbnb property?
On the other side of this issue is damage caused by guests of an Airbnb. It is likely that the damage deposit is not sufficient to cover substantial damage. In addition, the insurance coverage provided to owners renting under Airbnbs programs is also not adequate in most cases.
In one publication about a rental, some renters did so much damage to an Airbnb rental that the total damage was in the neighborhood of $75,000.00. This would clearly leave a bad taste in any owners mouth in terms of renting through Airbnb.
Airbnb offers a Host Guarantee program that provides up to $1 million of property damage protection if needed and unable to be resolved with the person renting the property, but is limited to damage to a host’s property, not including damage to shared or common areas of the building that aren’t part of the listing, cash and securities, damage caused by pets, jewelry, collectibles, and artwork.
While Airbnbs can be a great option for both renters and owners, this option does not come without risks to both sides which need to be given consideration when deciding either to rent your property through Airbnb or to rent such a property as a consumer when looking for out of town accommodations. Consumers having been injured in an Airbnb rental situation are well advised to consult with a lawyer. Likewise, owners of properties seeking to rent their properties through Airbnb are also well served to get legal advice before embarking in such a rental program.