Replace Extenuating Circumstances policy with Trip Insurance

Status changed to: Under Consideration

We all understand the kinds of life events that can prevent travel. Rather than upsetting guests over non-refundable trips, Airbnb has shifted 100% of the financial loss to hosts by way of the extenuating circumstances policy. Why do guests not have some skin in the game when an issue arises on their end?

 

This isn't a fair practice. We choose our cancellation policies based on our market, personal economics, and degree of risk aversion. The extenuating circumstances policy creates a loophole over which hosts have no control.

 

If Airbnb is unable to offer trip insurance, they should allow hosts to choose two cancellation policies: One that applies for regular cancellations (currently implemented), and one that applies to extenuating circumstances (eg. no refund, 50%, full refund).

 



Response from Airbnb

Thanks for your feedback. It’s helping us understand how the Extenuating Circumstances Policy is affecting hosts. We agree that this issue is important and we’ve been taking a close look at multiple options to address it. While we’re not able to offer trip insurance at this time, we’re hoping to explore it as a possibility in the future. In the meantime, we’re collecting as much feedback as possible.

 

Comments
Kathy252 in
Sonoma, CA
Level 2

YES, I agree as well.  I was affected by a guest initiating their right to cancel with this policy, and was shocked that Airbnb could take $1,600.00 of our income without so much as communicating with us before hand.  Instead of putting their agents in the position of making strenuous decisions affecting hosts and guests alike, offering travelor's insurance will make everyone happy!!  

Jim & David in
Atlanta, GA
Level 3

Yes!!!  It makes so much sense.  Offer an inexpensive insurance policy with each reservation just like the airlines do. I’m sure Allianz or similar would make a killing.  Why should Airbnb hosts have to shell out a full refund when “extenuating circumstances” occur??  It’s beyond our control too.  

Cormac6 in
Kraków, Poland
Level 10

@Allison2

 

 

Airbnb's system has been contrived on the principal that they have ZERO risk and that the Host pick up the tab. For the service Airbnb is actual offering, their fees are outrageous.

 

I would consider a combined fee for Host and Guest of 1% nearer the mark not the circa 20% yes 20% they are currently charging. Airbnb is building a mountain of bureaucracy around the short-term rental market while at the same time absolving themselves of any culpability, effectively they are trial judge and jury.

 

Airbnb ridiculous not so smart “smart pricing” is relentlessly reducing prices to the point that a host cannot make a profit, so what happens one leaves the system and the next mug comes along to take one’s place.

 

What they should do is for a start…

 

  1. Reduced their fee to 1%
  2. Have a charge for travel insurance paid by the Guest.
  3. Standardise our property models into 1 to 5-star properties (yes Airbnb do a bit of work for a change)
  4. Build a transparent pricing model based on realities. (smart pricing in New York is different from smart pricing in Krakow Poland, in other words zl10 is not the same as $10 its circa 4 times less, it is my conjecture smart pricing does not understand this and it needs to!
  5. Pay their Host a retainer for making their properties available for Airbnb to make money on, why should hosts exclusively bear the cost for the fallow months? (if you rent a car you still must pay the fee while its sitting in the drive way)
  6. Recognise that there is a considerable amount of properties being sublet without the appropriate insurances, state governance and landlord permission and DO SOMETHING ABOUT IT.

 

It the last two-years Airbnb have spend Billion of dollars on company acquisitions the money we have made for them and yet the customer service Airbnb is offering is generally regarded as abysmal.

 

Note: this polemic with be denounced by the “Twenty Percent” what does that mean I hear you say, It means there are twenty percent of Host making an absolute fortune on Airbnb to varying degrees in fact I know a chap personally making circa Euros 10,000 a month on 4 units the total area of which is 120m2, these Hosts can absorb a considerable amount of cost and damage as you can imagine, the other 80% cannot and need a much better service from Airbnb.

 

Regards

Cormac

 

Administrator
Status changed to: Under Consideration
 
Mike415 in
Baywood-Los Osos, CA
Level 2

Amen

Administrator
Status changed to: Under Consideration

Response from Airbnb

Thanks for your feedback. It’s helping us understand how the Extenuating Circumstances Policy is affecting hosts. We agree that this issue is important and we’ve been taking a close look at multiple options to address it. While we’re not able to offer trip insurance at this time, we’re hoping to explore it as a possibility in the future. In the meantime, we’re collecting as much feedback as possible.

Ria16 in
Northland, New Zealand
Level 10

The travel insurance one is hard. As a guest I would not have been able to claim for nights not stayed at a BnB due to Hurricane Irma because I bought my insurance after the hurricane had been given a name I wasn’t expecting the airport to shut for three days.

it would certainly be cool if AirBnB included this.

Emilia42 in
Orono, ME
Level 10

Completely agree. I just returned from a trip I booked through a travel agent (hotel and airfare). It was non refundable but the travel agency suggested I get trip insurance and listed a few third party options unrelated to the agency. I decided not to purchase it and was fully aware of the risks. I used to work at a 4-diamond hotel and outside of the cancellation period this is always what was suggested to guests.

Level 6

Totally agree.  C'mon ABB - this makes sense - what's holding you back?

Gail & Beth in
San Diego, CA
Level 3

Drop the extenuating circumstances policy -- Just kill this very likely illegal, host-abusive policy now.

 

We just had over $2,600 charged to our account for a 100% refund awarded by AIRBNB, 9 days into a 19 night reservation that was cancelled the night prior to arrival (actually the morning of arrival, given the time zone difference)  This policy is onerous and likely illegal.  We have to blame AIRBNB more than this ill guest and his family, but capitalizing on this loophole is something we also need to call out, as that is a choice this guest made, wrongly we feel.  It's a choice too many guests make, and in our case, the illness was real, but in many cases we hear, a fraud or misrepresentation is being committed. 

 

Our understanding is that this guest's health had been declining for some time and that he was an ill man when he booked this reservation for which our cancellation policy was 'strict.'  Some time after he booked with us, his doctor informed him that he was too ill to travel.  These guests waited until the night prior/morning of arrival for a 19 night stay, to cancel the reservation, at which point the cancellation policy provided for no refund.  They even waited to cancel in the system because, as they communicated to us, they feared we would profiteer by having their rent and then also rebooking!   So we could not have rebooked and remunerated them, as the calendar was blocked until arrival, and it should come as no surprise that we've been unable to rebook a 19 night in the middle of February, with zero notice.  We also had offered to reschedule the guests but they did not wish to do that, or were unable, due to the man's declining health. 

 

The guests then made a claim to AIRBNB and AIRBNB issued them a full refund -- Over $2,600 -- which AIRBNB is forward charging to our account, due to 'extenuating circumstances.'  This is an entire mortgage payment for us.  It's also enough to significantly offset this year's projected gain of short term rental income over long term rental income, due to the increased effort and costs associated with short term renting a unit.  We'll be working harder, for little incremental income.  We are not a hotel, not a corporation that can absorb or spread these costs -- We do not have that kind of cost structure, we're just ordinary people who own property that we offer for rent. 

 

AIRBNB did not even inform us that a claim had been made against our rental income, which was already in the bank!  Decisions were made based on those funds having been secured in our account for over a week.  AIRBNB waited until 9 days into the cancelled reservation to inform us about anything, and they did not call us to discuss or even consider the hardship this might impose upon us.  A front line rep from another region, we think possibly India, simply opened a message thread indicating that a full refund had been issued, we'd been charged, and included the boiler plate of their policy.  The fact that hosts are the `front line revenue producers for AIRBNB, that we are not hoteliers or corporations with cost structures to accommodate, and that we've been robbed suddenly, and very late, of a mortgage payment, means absolutely nothing to this company.  They even empower very immature, unskilled and inexperienced people to handle $2,600 decisions unilaterally, with no input from the affected host.  Meanwhile, AIRBNB is laughing their way to the bank every day with a huge corporate tax break and our service fees, while we figure out how we're going to pay the mortgage in a month or two. 

 

Our listing includes very detailed rental rules, including our understanding of what no refunds means and even the suggestion that guests might purchase travel insurance to cover medical issues.  All shown up front, before booking.  This is precisely the kind of situation for which travel insurance is intended.  These guests knew of the illness, opted not to purchase travel insurance, chose to book with a host who has a strict cancellation policy versus one with flexible or moderate policy, and then used this egregious loophole to get their money back.  AIRBNB did not even consider splitting the cost between guest and host, so that no one would be hit this hard.  

 

Seems that AIRBNB encourages guests to breach cancellation policies, the parameters of which AIRBNB has expressly defined for us.  Has to be legally suspect. 

 

There is no insurance in the land that would enable a host to recover financially for a loss of rent due to an AIRBNB policy decision.  We're stuck, wide open.  We narrowly averted an even bigger loss just a month ago when another guest -- this one with a fraudulent claim -- tried to wiggle out of a month's stay at the last minute (before arrival).  The first AIRBNB rep awarded them.  We made a few more calls and finally found someone who saw through and had the maturity and experience to deny the guest the refund.  That would have been over $3,000 lost.  Now picture this -- Host loses $3,000 one month, and then $2,600 the next.  This would have happened to us had we not used our business acumen and assertiveness to work this system to the max -- It was exhausting, time consuming and highly stressful.  How the heck can this company justify this policy??  How can so many inept, inexperienced reps be empowered to handle this level of monetary decision-making?  It's beyond insulting and demeaning -- It's unjustifiably destructive.

 

In our book of values, when you enter into an agreement for which cancellation is restricted, you honor that agreement, especially if the recipient of the loss would be just another human being with a mortgage to pay, versus a big, deep pocketed enterprise like AIRBNB.  So this is more than about policy -- It's about the ***CULTURE*** that AIRBNB has created in this, their ***ALTERNATIVE UNIVERSE*** (think 'Black Mirror'), where properties are micro hotels or hotel units, landlords are 'hosts', and tenants are 'guests,' and AIRBNB is 'big brother'.  (When in actuality, these are rentals, with landlords and tenants and AIRBNB is a platform where they meet, nothing more, nothing less, that is run by millenials, who know too little about proper business ethics and policies.)  If AIRBNB has such good will toward travelers, why doesn't AIRBNB pay in these instances they define as "rare," which countless hosts have experienced?   In what other industry or business does this scenario exist, outside the alternative universe of AIRBNB?

 

Funny how AIRBNB created this hotel culture, which prompted so many cities to ban short term rentals, and now AIRBNB is the most politically active platform defending short term rentals nationwide, and supporters are applauding them -- Except, by the way, this is a monster that AIRBNB nearly single handedly created.  And we're on teh front lines fighting for three years now to keep short term rentals legal in San Diego.  Thanks a lot, AIRBNB, go ahead, rob us, too, while you're at it.  No one thought of vacation rentals as micro hotels until AIRBNB created this universe in which rentals are marketed and managed as such.  And it's become the brand name in short term rentals -- which most people just refer to as "AIRBNBs."

 

In our case, the guest had been ill for some time, was in declining health (terminal) and is a retired medical doctor -- They should have known, and in fact, did know enough to buy travel insurance (especially as our listing suggests it), or book a property with a flex cancellation policy, or honor the agreement with us, or ask AIRBNB for 50%, or notify us and cancel sooner, or reschedule, or allow us and wait for us to rebook...all options under the circumstances.  They had plenty of choices and were very handsomely rewarded for pursuing none of them -- at the expense of our mortgage payment.

 

It's a matter of time before a class action is brought forth for procuring cause and AIRBNB will hopefully get exactly what it deserves for this -- nothing more, or less.  

 

We demand our $2,600+ back.  Drop that charge on our account.

cancel
Showing results for 
Search instead for 
Did you mean: