Traditionally, home insurance policies do not cover commercial use of a property, such as letting a room 

Specialist sharing economy insurtech Pikl has partnered with price comparison website GoCompare in a bid to bridge the home insurance gap by providing cover for short-term rentals.

GoCompare claims to be the first comparison site to integrate this type of cover into the home insurance quote process.

Louise Birritteri, Pikl’s chief executive and founder, said: Our industry-wide report, Insuring the sharing economy, that we published in 2019, highlighted that the insurance needs of over one million short-term rental hosts were not being adequately accommodated by major insurers in the UK.

“We’re delighted that this partnership with GoCompare will now go a long way to making sure people in the sharing economy are operating with the right type of insurance cover and won’t be left at risk from theft, damage, fire or even public liability. We expect many other product manufacturers and distributors to follow suit.”

Potential risk

Traditionally, standard home insurance policies do not cover commercial use of a property - for example, letting a room or driveway. Therefore, claims for theft would not be covered if the theft was committed by a guest.

However, host insurance is a type of insurance that can complement a home insurance policy by providing cover for guest injuries, property loss, or damage caused by hosting activities.

It may also include cover for:

  • Fires caused by a guest.
  • Escape of water caused by a guest.
  • Accidental or malicious damage caused by a guest.
  • Third-party property damage caused by guests.

In GoCompare’s home insurance quote process, an option is now presented to customers to declare whether or not they let their property on a short-term basis.

This allows customers to return quotes from a panel of insurers offering a specialist home insurance product, along with Pikl’s host insurance.

Ryan Fulthorpe, GoCompare’s car and home insurance expert, said: “The sharing economy looks only set to increase with the world opening up once more – people can now share driveways, cars and even their homes, with a whole host of innovative businesses, making this a feasible way for people to live more sustainably and make money.

“While this brings lots of positives for homeowners who want to make extra cash, it’s important that the insurance side of this is considered. There would be nothing worse than making money from letting a room in your property, only to be caught out if you need to claim for damages but your policy is invalid.

“At the moment, when it comes to hosting or short-term letting a property, not many home insurance policies will cover you if you need to make a claim, so there is a potential risk for a lot of people who ‘host’ not to have the right insurance cover in place. [This] is why we felt it was important to address this during the quote process – before someone takes out a policy.

“Many people, through no fault of their own, might not realise they need this type of cover, so it’s something we are signposting as a way to help people get the right cover in place.”