Insurance tips for renting out your cottage
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Here are some tips to assist you before renting out your cottage and handing over the keys.
Check your current coverage
The first person you should speak to is your insurance broker.
Does your cottage insurance policy provide coverage when you rent it out to others?
If yes, are there any restrictions? Some policies restrict coverage for damage or theft. Other policies all you to rent out your cottage for a specific length of time such as a week. Does your insurance company allow for increasing the length of time for an additional fee if you need it?
Consider increasing your liability limit
Renting your cottage creates increased risk of injury to others. If you have $1,000,000 liability, consider increasing it to $2,000,000.
If you are pro-active, you can reduce the risk of damage to your property and bodily injury to others.
Provide a manual or book for your guests
No one knows your cottage and the surrounding area better than you. Renters will be unfamiliar with your cottage and will not know what to do or who to call in the event of an emergency. In addition to letting your renters know the location of the best places to eat or shop, your book or manual should contain the following important information:
- Your contact information and/or the contact information of the property manager if you have one.
- The location and phone numbers of the fire department, police, hospital and doctor including veterinarian. Rural areas may not have 911 services or a permanent firehall with full time firefighters.
- Instructions on how to operate important equipment. For example, plumbing in a cottage can be quite different from what you find in urban areas. Cottages can have septic tanks and pumps and even the toilets may be different. If any equipment at your cottage requires special attention or specific operating procedures, make sure your renters have the instructions.
Choose your renters carefully
Renting to family and friends is easy but renting to people you don’t know has it’s challenges.
- Be selective. Renting to a family is different than renting to a group who wants to celebrate an event.
- Be clear on the rules so that would be renters understand your terms before they book your cottage.
- Ask the renter to provide a credit card for a deposit in the event they cause damage to your property.
- Don’t allow renters to use your motorized vehicles
- Allowing renters to use your boat, PWC, ATV or other motorized vehicles will increase your risk of a liability claim. ATVs, boats and PWCs can usually be rented from the local marina. If your lake does not have a marina, the nearest marina will be more than happy to drop off the vehicle at the cottage or the nearest boat launch for your renter.
Have your renters bring their own life jackets for children
Life jackets need to be properly fitted. If you provide life jackets for children to your renters, you may be assuming liability for anything that happens.