Insurtech
The insurtech started by Humphrey Bowles and co-founder, Andrew Boldt is a genius idea, and a much needed tool in the home sharing armoury. It’s an automated pay per stay insurance solution that covers you for any eventuality that your home-sharing platform (Airbnb) might try to shirk, and believe me there are many. Personal liability cover for example, did you know that if a guest has a mishap in your home, you could be liable? No, quite, because most hosts don’t have a clue.
‘I used to work at a leading home sharing platform,’ Bowles says of the lightbulb moment when he and Boldt set up the platform, ‘I was running the new business side. I ended up speaking to thousands of hosts and the first question they always asked was how much money can I make? And the second was always what happens if something goes wrong? There was never really an adequate answer. Because your existing insurer looks at home sharing as a commercial activity (you’re making money from hosting) and so at best, the risks involving your guests are not covered, and at worst, hosting may invalidate your home insurance. Hosts are unprepared for these new risks.’
‘The main risk is not doing anything at all,’ Bowles says. ‘Say a guest damages a neighbouring property for example by forgetting to turn taps off, flooding all the flats beneath them which we’ve seen happen.’ So from home sharing ironically you could end up losing your home if you haven’t taken sensible steps to protect yourself, is the onus. ‘There was a publicised event down in Brighton,’ Bowles says, ‘and the guests had a party in a flat. They had a number or people on the balcony and it collapsed, the homeowner was sued for insufficient maintenance on it over time, and the resulting injuries that occurred.’ This is one of the rare horror stories that crucially does happen.
Bowles met business partner Andrew on a government-led home-sharing insurtech round table discussion and the rest is history. ‘He is the insurance geek, and I am the home sharing geek, put us together and you have GUARDHOG.’ The platform is a call to arms, ‘for individual hosts to take responsibility for their home sharing actions. They are the ones benefitting from the growth of the sector, they should therefore take responsibility if something goes wrong.’ You have been told, homeowners.
Home Sharing Insurance
They have built the GUARDHOG platform to work with the full range of OTA’s (online travel agents like Airbnb, VRBO, Booking.com), property management companies like Air Peace of Mind as well as individual private hosts. Bowles says that these platforms have created huge opportunity for many ‘but they are very clear when it comes to guest damage that the sole responsibility remains with the host. That’s where we help out. We combine pay per stay cover with neat tech which allows hosts to integrate their home sharing platform to the site. We then automatically put cover in place on a stay by stay basis.’ A swift solution in which the homeowner doesn’t have another task to complete, alongside the making of beds and plumping of cushions.
So what do some of these platforms like Airbnb cover you for exactly? I ponder, given that they make much ado of their million dollar guarantee. ‘There is a difference between insurance and a guarantee’ Bowles states, ‘and a guarantee which is paid off their balance sheet. In most cases the protection policy or guarantee is not an insurance product and therefore does not give you the same rights, regulations, protections and benefits as an insurance policy.’
Airbnb
Airbnb provide protection of approximately £760,000 per night (based on the current dollar to sterling conversion) around the world and it’s all found in Airbnb’s terms of conditions, but as we know most people don’t read the terms and conditions.' Bowles explains, ‘Each platform is different in how they operate, so you check the terms and conditions carefully. Taking out your own insurance policy will always give you the highest amount of protection. For example, whilst Airbnb’s liability cover is an insurance contract between Airbnb and its own insurer, its cover for property damages is not. Should you wish to make a claim for this, Airbnb make it very clear that they are not obliged to cover you and the entire risk remains with you.
Comparatively, GUARDHOG’s products are insurance contracts so you can be fully insured unlike either of Airbnb’s programmes. With GUARDHOG insurance, the host has full control over the claims process; should you need to make a liability claim through Airbnb, the host is not party to the contract and therefore has no input in the claims process.
So back to early warning signs of trouble. ‘Same day bookings have a higher incident rate,’ Bowles says. 'Always ask questions, if they don’t get back to you trust your gut... Also be wary of bookings from someone living in the same town, or someone with a newly created profile and no reviews.’ Which leads me to the question of whether to use Instant book or not? ‘Unless you’re using a tool like GUARDHOG, we wouldn’t recommend using it, because you are not in control of who is or is not staying in your apartment. There are many reasons why people love it and yes it does help you get better occupancy and for the platforms it’s better because they make more money out of your home, but we recommend always have the option of saying no to guests; by not having it on you give yourself that opportunity.’
As an entrepreneur Bowles also has plenty of spirited advice on this growing sector. ‘Take it slow and steady, you need to understand what the pain points are you are trying to solve and that the offering you are providing is bang on point. We grew the business organically. My belief is that showing you can run a small team profitably is a way of getting better investment terms in the long run.’ This required each of the founders to invest up front capital, which is the calculated risk they took on signing up and so far has handsomely paid off. So when you hear the wheels of local Airbnb guests rattling down your street of a Saturday morning, you can rest a little easier knowing your neighbours have their GUARDHOG policy in place, you hope.
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By Alice Kahrmann
23 January 2020
