Apartment or house rent market is constantly increasing, whereas the major determinants of its growth include the rise of investments into housing intended for rent as well as the opened short-time rent opportunities through the online platforms such as Airbnb or Booking.com. Gains cannot be separated from risks; consequently, we hear increasingly more stories about people who entrusted housing to tenants or short-term guests and eventually had to deal with the costs of tidying up the vandalised premises.
A flat in the Kaunas old town
© Norbert Tukaj

"It can be said that stories covered in the media represent just the top of the iceberg; however, claims for damages in rented housing are routine. During the first six months of this year, we already paid more than fifty compensations for damages sustained in rented housing. We forecast that by the end of the year the number of insurance benefits paid will double at least, because summer and early autumn are the most popular seasons for short-term rent", said the Head of Property Claims Group at If, Giedrė Vitkauskienė.

According to her, on average, losses compensated in rented housing amount to 650 euros. However, we had several cases where damages exceeded 10 thousand euros, whereas the largest benefit paid was 185 thousand euros. This record claim was reported after a fire in a rented spacious timber house.

Unfortunately, vandalism is not an exception
Ms Vitkauskienė reveals that vandalism generally surfaces during parties. Furniture, doors and windowsills as well as household appliances get broken, floors or carpeting get damaged. "We do not see a trend that objects rented through online platforms sustain more damages due to intentional actions; however, it is obvious that losses are unavoidable when lessors take both short-term and long-term tenants."

Had no insurance coverage option before
"Insurance of rented housing against intentional damage caused by the tenants is a novelty not just in Lithuania. Previously, such events used to be categorised as non-insured, however changes in the market impelled us to change the terms in favour of our customers. As the supply of rented housing increased, a problem appeared that quite often wild parties are being organised there and afterwards the owners find piles of shards and splinters and have few possibilities to recover the damages from the guilty parties", told Ms Vitkauskienė.

What should be noted?
To those who decided to insure the house or apartment offered for rent, the representative of the insurance company suggests to think over the damages that might arise there and to peruse the terms offered by different insurance companies, because these might differ significantly. Conclude a legally correct rent contract with the tenant. It should specify the terms for the payment of rent and utilities, other agreements and obligations of the parties as well as enumeration of articles present in the apartment, their condition and value.

To the apartment owners who want to feel even safer, we always recommend contracting civil liability insurance. This service protects against losses that might be sustained by third parties, for example, where a water hose of the washing machine breaks in the rented apartment and floods the neighbour's apartment or the tenant leaves an iron switched on and neighbours' property is burned in the fire or flooded by the firefighters.

Those willing to insure the rented housing against intentional damages inflicted by the tenants must inform the insurance company about commercial activities being pursed.

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