South Africans are leaning heavily on the sharing economy to stretch holiday budgets – from Airbnb rentals and house swaps to loaning cars to friends or even renting out a vehicle. But insurance experts caution that many consumers have not considered whether their policies will respond if something goes wrong.
Industry specialists say these increasingly popular arrangements carry a range of insurance implications that are often overlooked. Questions about whether a car remains covered when loaned to someone else, what rules apply when renting out a vehicle, whether home insurance extends to short-term letting, and whether valuables stolen at an Airbnb can be claimed for, are becoming more common. Holidaymakers also need clarity on how cover works when a house sitter is in the home, or when families exchange houses for the season.
Ernest North, co-founder of insurance platform Naked, said consumers should not assume traditional personal policies will automatically cover these scenarios.
“Whether you’re lending your car, hosting Airbnb guests, or travelling with valuables, it is important to know what your insurance covers. A quick check with your insurance provider before the holidays may prevent you from an expensive loss if something goes wrong,” he said.
Car lending and the ‘regular driver’ trap
North explained that most personal car insurance policies will cover occasional lending of a vehicle to a friend or family member, provided the person holds a valid driver’s licence and uses the car in line with the policy terms.
The difficulty arises in the distinction between an occasional driver and a regular driver. Occasional, once-off holiday use is generally acceptable, he said, but sustained daily use – such as a student using the car every day for a semester – could mean the insurer regards them as the primary driver.
“The reason this matters is that your insurance will calculate your risk based on the person that drives the car most often,” said North.
Because younger drivers carry higher accident risk, premiums may be affected. If a different person is effectively the day-to-day driver and the insurer discovers this after a claim, it may recalculate premiums or, in extreme cases, decline the claim for non-disclosure.
Renting out your car? Expect commercial rules
The practice of renting out a private vehicle remains relatively new, and North said most insurers still treat this as commercial use.
“Most insurance companies regard renting your car out as commercial use that would not be covered under a personal insurance policy,” he said.
The risk profile changes substantially because the vehicle may be used more frequently and by strangers.
North noted that consumers considering this should expect to purchase commercial cover, which many may find prohibitively expensive for casual weekend rentals.
Short-term letting and why standard home cover may fall short
With platforms such as Airbnb making it easy to rent out rooms or homes, insurers are seeing an uptick in claims disputes linked to short-term letting. North said standard personal home policies generally do not cover these arrangements because of the higher risk of accidental damage or theft.
“If you rent your place out on Airbnb or similar platforms and haven’t told your insurer, your claim for damage or theft might be rejected,” he said. Commercial cover is often required, although some insurers treat partial letting – such as renting out a room while the owner remains in the home – differently.
North added that although Airbnb’s AirCover provides some host support, “it is not a substitute for your own insurance”, and hosts remain responsible for securing adequate protection.
Stolen valuables at an Airbnb remain your responsibility
Travellers hoping to claim from a host’s insurance if their valuables are stolen at an Airbnb should temper their expectations. North said hosts’ policies generally do not cover guests’ belongings.
He advised travellers to ensure any high-value items are specified on their home contents policy or protected through standalone cover.
House sitters and disaster scenarios
Most insurers will continue to honour home cover if a house sitter is staying in the property with the owner’s permission. North said the caveat is that sitters must meet the same reasonable responsibilities as the homeowner, such as locking doors and windows and preventing avoidable damage.
He noted that cover may be compromised if the sitter engages in unrelated activities – “running a car repair shop from your garage”, for example – or behaves in a way that materially increases the risk.
House swapping: covered, but with important caveats
House swaps between friends or family are typically treated the same as guest or sitter stays, and normal cover generally applies. But North cautioned that theft without signs of forced entry may not be covered, and homeowners’ policies usually do not insure guests’ personal belongings.
He added that insurers may treat frequent swaps with strangers, or swaps facilitated through platforms, as short-term letting.
“If you swap homes regularly with different people or use platforms to swap stays with strangers, your insurer may regard this as short-term letting or commercial use, even if no cash is paid,” he said.
Given the rapid growth of holiday sharing arrangements, advisers may find increased need to guide clients through the complexities of cover, disclosure, and risk. North emphasised that checking policy terms upfront can prevent costly surprises – and ensure festive savings do not turn into New Year losses.
