Property sharing has its pitfalls

Shropshire homeowners who rent out their spare room could be asking for trouble, according to a local insurance expert.

Dave Williams, of Henshalls Insurance Brokers in Newport and Shrewsbury, said not only could the homeowner be contravening their mortgage or lease conditions, they could also invalidate their home insurance policy.

“Nearly 80,000 homeowners in the UK earn extra cash by using property sharing services such as Airbnb, but by letting out available rooms you could actually be risking everything.

“Most leases have a condition that the property cannot be used as anything other than a private residence, but if you let spare rooms to paying guests, you could face losing your lease altogether.

“And even if you are allowed to let your property, you could still be jeopardising your insurance policy if you don’t inform your insurer about your plans to host – if they find out you’ve been sub-letting rooms, they could refuse to pay out if you make a claim.”

Mr Williams said some property sharing services offered a “host guarantee” just in case something should go wrong while a guest was renting the space.

“But this guarantee should not be treated as a replacement for home or tenants’ insurance.

“In fact, generally, the guarantee will not protect your cash, your pets, or cover reasonable wear and tear, or common areas, and there is only limited protection included for jewellery, collectibles and art work.

“If you are seriously thinking about letting your property through a property sharing service, make sure you check your lease or mortgage first to see if it’s permitted.

“And review your home insurance to verify whether you would be covered if you should have to make a claim.

“Existing policies can be amended to allow for a property sharing arrangement, but the changes will need to be made before you let the tenants in, not once they’re in residence.”