Risks when renting your holiday home to friends

Posted on 01/09/10, filed under Holiday Home Insurance | No Comments

If you have a holiday home sometimes even your best intentions can cause you grief.

Discovery of old friends

A recent survey highlighted that a very high percentage of second home owners have been subjected by family or friends to a request (directly or more subtly) for a free or cheap holiday. No-doubt the credit crunch, weak pound and ‘staycation’ trend are all contributing factors.

Just about anyone that owns a holiday rental will, at some time or another, have suddenly found they have friends and even family coming out of the woodwork. It can be amazing how quickly the conversation will be steered around to that holiday property they’ve just heard you have.

Some people seem to find it hard to grasp that if you’re letting them have your property then it is costing you money – particularly if that’s in peak season periods where you have your running costs, wear and tear, plus the loss of rental income.

So, the difficult explanations start and you may find that suddenly your friends and distant family members suddenly fade back into the background!

Your responsibilities as the owner

If you do weaken or just spontaneously offer your property for free (or at ‘mates rates’) to family and friends as a gesture, remember a few sobering facts of life:

• if they have an accident on your property (for example, a slip on the floor tiles or a balcony fall), or in your swimming pool, you may have a legal liability for any costs involved in defending an injury claim and subsequent compensation – even if they’re not actually paying to rent your property;

• they are just as likely as any other person to accidentally damage your property, or worse still, cause a fire/flood that damages surrounding property – and they may be less than keen to pay for it;

• it can make sense to ensure you have adequate second home insurance to cover these and other eventualities.

Holiday property insurance

The combination of circumstances surrounding the use of your second home can be complicated and varied. It is important to understand that some insurance policies for second homes provide limited, if any, cover when letting out.

Some areas to check…

Many insurers offer limited protection for public liability insurance (some foreign policies only up to £100,000 indemnity and often exclude swimming pool related incidents).

Some policies provide no accidental damage cover when the property is lent to friends or relatives and certainly not when let out commercially.

The good news is that at Schofields, our holiday home insurance provides comprehensive cover regardless of whether your property is used for holiday lettings or just private usage.

Benefits include:

• £5m public liability insurance should someone injure themselves on your property and take legal proceedings against you;

• this also covers liability claims arising from the usage of swimming pools for both UK and overseas property – such as slips and trips, or cuts from broken tiles. (Some insurers exclude liability for swimming pool usage leaving you potentially exposed to legal action following injury to third parties);

• public liability insurance is included as standard when you choose buildings or contents insurance;

• the option to extend your holiday home contents insurance to include accidental damage by guests. Broken TV’s, jammed DVD players, spillages and burns on carpets are all too common at holiday homes.

Friends and family

You probably don’t want to seem like an ogre and may even wish to do what you can to help genuine friends and family to enjoy your property. In fact, they can help ‘air’ the property during the winter months when it would be otherwise empty.

Just remember though that legally and in insurance terms, when they’re in your property they’re probably no different to a conventional renter.

It might also be worth making sure that they understand that before you actually hand over the keys to your precious second home.

Choose a policy that covers your second home regardless of its usage.

Wear and tear at your holiday rental

Posted on 27/08/10, filed under Holiday Letting | No Comments

The peak summer holiday rental season is nearly over and no doubt your holiday home has seen an influx of guests – some properties see as many as 30-40 different families throughout the year.

I often come across rental owners ‘ranting’ about guests who have stained towels, bedding or sun lounger cushions, left a mug ring on a coffee table or misplaced sun umbrellas.

Owners need to accept that holiday letting comes at a price – accidents happen. Occasional damage and wear and tear are part of the risks when holiday letting. On occasions, owners need to absorb these cost as ‘part of the territory’.

Don’t get me wrong, damage deposit deductions should be made when there has… read the rest of “Wear and tear at your holiday rental” >>

Recap of holiday home news: 25 August 2010

Posted on 25/08/10, filed under Latest News | No Comments

It’s time once again for our holiday home, property and travel news round-up, here’s what’s been happening…

Earning an income from your holiday home isn’t easy. One of the best ways to increase your holiday lets rental potential is to target a niche – child friendly, boutique, walkers, bird watchers etc. and tailor your offering (furnishings, facilities, advertisements) to appeal to your niche market.

Also consider what extras you can offer to help you stand out and get more bookings.

For more advice on how to rent your holiday home follow our tips.

What is the best day to get holiday home bookings? A recent report from Expedia found that… read the rest of “Recap of holiday home news: 25 August 2010” >>

Is your second home really ‘fully insured’?

Posted on 18/08/10, filed under Holiday Home Insurance | No Comments

Unless you inherited it, your second home probably cost you a considerable sum of money.  As such, it’s a major asset and protecting it with appropriate second home insurance is simply common sense.

Second homes and risk

If you don’t immediately accept the logic of that, you may wish to think for a second about the risks that could turn your dream home into a nightmare.

You probably wouldn’t think about leaving your primary residence or its contents uninsured. There are no obvious reason to believe that your second home is immune from many of the risks your primary property faces. So why do many second home owners take a laid back approach when… read the rest of “Is your second home really ‘fully insured’?” >>

Forest fires threaten holiday homes abroad

Posted on 12/08/10, filed under Overseas | No Comments

The devastation that forest fires cause during the summer heatwaves is apparent. Russia has suffered a great loss and fire-fighters in Portugal are continuing to battle forest fires that are sweeping through the country. Infact, July was the worst month for fires in Portugal since 2005, with 5,524 registered across the country.

Recent reports from Spain also indicate that July 2010 has been the hottest July for the last thirty years and Portugal recorded its hottest July for 79 years. Scorching temperatures, drought and tinder-dry forests all increase the risk of forest fires.

The fact is that many overseas property investors purchase homes in idyllic settings often in the rural countryside surrounded by forests and scrubland… read the rest of “Forest fires threaten holiday homes abroad” >>

Carbon monoxide safety at holiday accommodation

Posted on 09/08/10, filed under Maintenance Advice | No Comments

Following the tragic deaths at a Northern Ireland holiday flat last week following a suspected carbon monoxide leak, holiday accommodation owners should be vigilant for the signs and symptoms of carbon monoxide poisoning.

Carbon monoxide safety should be of paramount concern to all holiday home owners, especially those who let out their holiday homes.

But what happens if guests fall ill at your holiday rental and decide to take legal action following suspected carbon monoxide poisoning?

A comprehensive holiday let insurance policy should include public liability insurance (an indemnity of £2m is recommended). This type of insurance usually covers legal expenses in dealing with such a claim and compensation costs should it be proved the owner was negligent.

This unfortunate incident has highlighted how important… read the rest of “Carbon monoxide safety at holiday accommodation” >>

How to rent your holiday home

Posted on 04/08/10, filed under Holiday Letting | 1 Comment

Whether you are a holiday letting expert or a new to the market, the recession and a weak pound have resulted in a recent decline in family holidays abroad. Combined with increasing competition from owners renting in order to offset mortgage and maintenance costs – getting those bookings has never been so important.

However, it’s not easy to fill availability calendars. Holiday home owners often over-estimate the revenue they will get, and under-estimate the amount of work they have to do in order generate bookings.

How to get more bookings at your holiday home

Now, there are some things that you just can’t do much about.  If you own a property in a location nobody… read the rest of “How to rent your holiday home” >>