Does strata insurance cover damage to common property caused by an Airbnb guest?

The policy covers sudden accidental damage and malicious damage or accidental damage of that nature isn't excluded by the policy. Damage by tenants, including short term tenants, is a common claim that we get in strata insurance and we don't get exclusions applied for any specific reason. But not withstanding that the insurer does reserve the right to subrogate from the responsible person once they've paid the claim. So at the end of the claim, if the tenant has damaged the property, they will seek to recover the funds or the expenses related to that claim from the tenant.

Airbnb is you know one of those topics that does come up often and we do find that there are a lot of times that committees try to see if there's a clause in the policy which might assist them with enforcing usage of Airbnb in their complex. The short answer with Airbnb is that in the majority of cases insurance ought to know in the case of their business that buildings will have tenants that are Airbnb tenants, and also, there aren't specific exclusions around Airbnb usage. Insurers don't exclude buildings that have usage of Airbnb. Insurance isn't the answer to enforcing Airbnb for buildings, but there are obviously other laws and legislation available if the owners Corporation wants to address that specific issue.

We always recommend that owners corporations list the percentage roughly around holiday letting. That is definitely something insurers will require: percentage of holiday letting. Obviously, sometimes you don't know with Airbnb, the number of units that are used for an Airbnb basis, but the flip side is that when there's a claim you can always run the argument that you don't exclude Airbnb usage, so you wouldn't have declined the policy had we disclosed. So, take reasonable care to disclose the usage including holiday letting. But if you, in good faith, don't do that it's very hard for an insurer to apply any penalty to your policy at the time of the claim.

This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisernet Australia AFSL No 240549, ABN 15 003 886 687.