Guest House Insurance
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Do you really need Guest House Insurance?
Being the owner of a guest house comes with a double responsibility – for your own possessions and safety as well as that of your guests. And, although you may live there yourself, it’s nothing like house insurance since renting out rooms in your home is also your business. In essence, then there are two different avenues to look at when it comes to making sure you are covered by insurance.
The first area to consider is the buildings and contents, to ensure that the fabric of the building – and your own possessions – are both safe and secure. And, since many guesthouses tend to be located near the coast, flood and storm cover may also be necessary
The second area is the business side. That means covering yourself in the event a guest is injured on your premises or has their belongings stolen, broken etc. This may seem highly unlikely when you start out in business, but the busier you get, the more fraught life often becomes and well, accidents do happen… just make sure you’re covered if they do happen to take place in your guest house.
Different types of guest house insurance
Buildings and contents insurance.
This is the insurance policy you’ll need to cover you, should you be broken into and burgled. It will also pay for repairs in the event damage is caused to your house by a fire or flood. In terms of contents, this means you can reclaim costs should your freezer break down and food be spoiled, or a guest decides to go home with an expensive table lamp or ornament in their suitcase.
Public liability insurance.
All businesses where the public come and go are advised to have public liability insurance. That’s because it covers you should a guest (paying or otherwise) injure themselves by, for instance, tripping over a loose floor tile in an en-suite shower. It also covers an expensive piece of jewellery going missing from a guest’s room.
Product liability insurance.
This is an insurance cover for items (products) that you provide for your guests. It can include soap that causes an allergic reaction, or a guest insisting they are suffering from food poisoning after eating something they were served up for breakfast or dinner on your premises.
Employers’ liability insurance.
If you employ any staff to clean or cook breakfasts etc then you’ll definitely need this. In fact, it’s a legal requirement for business owners. What having this type of cover means is that should an individual/s injure themselves while carrying out their duties at your guest house or be off with stress caused by their job, then you will be covered for any claims they submit.
Loss of business cover.
If you have to close your guest house down for a period of weeks or months until structural damage to the building – caused by a fire, flood, subsidence etc – is fixed, you may be out of pocket. Or at least you would be if you didn’t have this type of cover. What it means is that it may be inconvenient to have to move house while renovations are ongoing, but it’s really not the end of the world since you will still receive an income (albeit, a smaller one) as if the Guest House was up-and-running.
Tips on getting the best value Guest House insurance
- Regardless of whether or not the first Guest House insurance quote you receive looks great, always take the time to shop around for something even more suitable for your business. And, on the plus side, that can mean less expensive too.
- Cutting back on offered extras such as loss of licence cover for the bar can keep your premiums low.
- Have a high – but affordable – excess should you need to claim. This can cut the cost of your guest house insurance by quite a large amount.
- If you can afford it, paying off the total cost of your guest house insurance in one go is less expensive than paying in monthly direct debit instalments.
- Ensure that when you do quote a sum for your contents that it’s accurate, otherwise you may not receive the true value of items should you make a claim.
- Always check what buildings & contents cover includes so that you don’t end up paying twice for a duplicate policy. This may, for instance, cover your tennis court, swimming pool and any other leisure facilities. It can also extend to the patio garden walls and even solar panels.
- High-quality alarms, locks and other forms of security such as CCTV cameras can cut back the cost of your insurance premiums. That’s because they’re seen as a deterrent to thieves, meaning you’re less likely to get burgled.
Guest house insurance FAQs
Q – Am I covered for accidental damage too under a Guest House insurance policy?
A – Usually not. It’s not often included as standard cover so it’s something you will need to request as an ‘add on.’
Q – What is the standard number of guests I can have staying in my Guest House overnight?
A – In order to qualify for most Guest House insurance policies it is six guests or less. Some allow up to 12 guests in a night under the same roof. Any more than that though and you are looking at taking out Hotel insurance.
Q – Do you insure all types of guest house buildings? I’m asking because I’m thinking of setting up my converted windmill home as a B&B?
A – It will depend on the actual insurer. Some companies will insure a windmill under their guest house insurance cover, others will only insure standard buildings such as detached homes, semi-detached and terraced houses.
Q – Why do you need my Employer Reference Number (ERN) if I choose to have Employers’ Liability cover in my initial quote?
A – Insurance companies are obliged to pass this on to the Employers’ Liability Tracing Office (ELTO) who will then add it to an electronic database for easy future reference in the event an employee makes a future claim.