Security Deposit Waiver Option for Vacation Rental Owners

Security Deposit Waiver (SDW) Protection is designed to provide an alternative to managing refundable deposits from guests while providing property protection and peace of mind.  SDW is an insurance product designed by Property Protect for vacation rental owners that is now available directly through your AlaVHR dashboard.

When you own a vacation rental property, protecting your assets is extremely important.  Keeping your property safe from accidental damage or unruly guests is one of the most important aspects of being a property owner. 

What is a Security Deposit?

Most owners collect a "refundable security deposit" ranging from $200 - $500 (sometimes more) when a guest books their stay.  The idea is that if there is any accidental damage or other issues caused by the guest, the owner will deduct the cost from this deposit.  Most of the time, even if there is a minor incident, the owner will refund 100% of the deposit out of good will to encourage the guest to return or to avoid a potentially bad review.  If there is a major incident, the amount of the deposit usually will not be enough to cover the damages and the owner has to go after the guest for even more money.  This results in bad rapport and can lead to bad reviews or possibly social media bashing.    Even when there are no issues, the owner must remember to issue the refund in a timely fashion, all of which can be a major hassle.  These are exactly the problems that SDW protection is designed to solve.

What is a Security Deposit Waiver?  

Property Protect provides an option for owners to offer a low, flat-fee damage policy.  This insurance rids the owner of dealing with the hassle of collecting and refunding security deposits (not to mention the awkward conversation that comes with it).  As a vacation rental owner, owning rental property is a lot of work. Security Deposit Waiver reduces your workload and saves you time!

This Security Deposit Waiver is a Tenant Legal Liability product created specifically for property owners and managers in case a guest causes damage or theft occurs during a short term rental stay. There are a few differences between Property Protect’s insurance and other damage policies that many other booking platforms offer.   Be sure to check out our chart for more information.

The biggest benefit is that with AlaVHR, the homeowner enrolls the guest (rather than the traveler). This means that the owner has complete control over the entire process!   The homeowner initiates the claims and typically the guest is not involved at all during the claim process.

Property Protect eliminates the hassle of collecting and refunding security deposits from your guests.   Did you know that most guests, if given a choice, will choose damage insurance over a refundable deposit?  Lower upfront cost for them and better coverage with less hassle for you. And it could not be easier -  just use your AlaVHR booking calendar and we do the work for you.

Another great benefit to this Security Deposit Waiver is that the property owner is the primary claim initiator and claim beneficiary.  There is no need to contact your guests in order for you to make a claim.   All of the other sites (VRBO, AirBnB, etc) require the guest to admit guilt before they will process a claim - and that means that most claims get denied and your "coverage" is useless!

Let’s Talk Through Some Frequently Asked Questions (FAQ’s)

1.  What’s Covered under the policy?

• "Unintentional" damage to furniture, appliances, decor, flooring, windows, and other interior items. Replacement costs of stained bedding, linens and or lost keys are all covered. There is no coverage for smoking/vaping deodorization or excessive cleaning.
• Yes, theft is covered!  There is only coverage of theft for any person other than the guest and their travel companions. Property Protect does not cover intentional acts and coverage would not be afforded if the guest intentionally took something from the home, i.e. drinking glasses. You may need to file a claim with your homeowner's insurance.  
• Pet damage is covered as long as the presence of the pet does not violate the rental agreement and your rental is pet -friendly.

2.  What isn’t covered?

• Smoke Deodorization, including any smoke or vape scent removal.
• Excessive cleaning, or regular cleaning fees.
• Adverse weather (weather damage is typically covered by primary homeowner's insurance).
• Loss of income.

3.    What are the policy costs to the owner and coverage?

Owners have the choice of three policies. The policy cost is per stay. Owners can choose to charge their guests the amount they choose. 

• The $49 policy covers up to $1,500 in damages and $0 deductible.
• The $69 policy covers up to $3,000 in damages and $0 deductible. 
• The $129 policy covers stays for 30 days or more (up to six months) and $0 deductible.

The expense/cost maybe a business write off to you. Please verify with your tax professional.   

4.  What do I, the owner, need to do? 

This policy is for potential guests only and not for commercial events or parties.  It is your job to ensure that you follow the policy guidelines.  If you file a claim, you are responsible for submitting photos of the damage or theft, provide receipts and/or invoices for repairs, and a short summary of what happened.

If you claim more than $1,000 worth of damages police report is required.

5.   When does the coverage begin and when does it end?

This policy covers your property from the time the guest checks-in to the time and date they check-out.

6.  How far in advance can I purchase a security deposit policy and how close to check in?

A security deposit waiver (SDW) policy can be purchased any time (even months in advance), up to 12 hours prior to a guest checking in.

7.   Can I use this policy to replace my homeowner's insurance policy?

No. This is a damage and theft policy only. It is best to keep your homeowner's insurance policy so you don’t have to submit a large number of small claims.  Submitting a large number of insurance claims to your homeowner's insurance can hurt your CLUE (Comprehensive Loss Underwriting Exchange) report and the cost of an annual premium.  We do not offer liability coverage.

8.  Can I buy insurance when no one is renting my home? 

No, the policy is based only on when you have guests staying on your property and not between rentals.

9.   Why should I get short term insurance as opposed to a year-long policy?

We know that when you run a vacation rental--you have a lot to think about.  Between repairs/maintenance, cleaning and guests coming and going, you don’t want to think about whether you’re covered or not.  And who wants to pay for an insurance policy when there are no guests residing at your property?  No one!  We’re here to close the gap between expensive, full-time policies and your busy schedule.

10.   What constitutes a "long term" policy?

A long term policy is valid for a single stay from 30-180 days.  This is perfect for snowbirds! If you have a long term rental, you would need to purchase a new policy every six months for year round coverage with a single renter.  The Long Term policy provides up to $3000 in coverage with no deductible - and covers pet damage as long as your rental agreement allows pets.  For stays less than 30 days, choose the $1500 or $3000 regular policies.

11. What happens if a renter cancels their stay?

No problem, simply log into your AlaVHR dashboard and cancel the booking where you purchased the insurance policy.  Your payment will be refunded to you right away, it is that simple! 

12.  What if I have bookings from another website besides AlaVHR?

You may purchase SDW insurance through the AlaVHR dashboard for ANY booking, regardless of platform.  That means even if you booked on VRBO, AirBnB, Facebook, Craigslist, etc., you can have peace of mind that you have have a policy that will stand behind you, the owner.  Remember, the VRBO policy depends on the guest admitting fault and AirBnB decides whether or not you have a valid claim.  With SDW through AlaVHR, you are the policy holder and the guest is not typically involved in the claims process.

13. Don't have an AlaVHR Listing? 

You can still benefit from using our program and purchase a security deposit policy.  Simply create a FREE account and set up your property - you do not need an advertising subscription to purchase and manage SDW insurance through our dashboard.  Just import your calendar from VRBO or another website and you are all set! 

This is the most “vacation rental owner-friendly” insurance policy available today!
Here's how it compares to other popular vacation rental listing sites' insurance policies: