Olympic Fever Brings Coverage Concerns

Vancouver homeowners who rent out rooms or houses during the 2010 Olympics could be opening their doors to additional risk.

Last week, the city’s council amended by-laws to make it easier for homeowners to become short-term landlords during the games, but doing so could affect their property insurance, says Lindsay Olson, vice president, British Columbia, Manitoba and Saskatchewan at the Insurance Bureau of Canada. Turning a home into a bed-and-breakfast or handing it completely over to tenants for a few weeks next year could negatively impact coverage, she says. “You’re basically changing a fundamental element of the risk. With a homeowner’s policy, you’re declaring residence. If you’re not there, the occupancy just changed.”

The liability exposures that accompany a temporary rental arrangement—or even to those who host volunteers or Olympic families–also extend to any food served, or having a tenant get injured or sick, Olson says. Another potential exposure is theft—“If a total stranger comes into your home and something goes missing, an underwriter may view that as a material change.”

The exposures will also vary depending on the number of people a homeowner takes in as renters. “Some scenarios carry a lot more risk than others,” Olson says. She urges homeowner planning to rent out space to consult a broker or underwriter to make sure they have the right coverage, and that what they’re doing won’t invalidate their coverage.

British Columbia insurer BCAA Insurance has issued a list of tips for potential renters, advising them to research municipal laws, use formal rental agreements, and take property inventory before they leave the house.

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