Editorial: Insurance move the right call
photo by: Journal-World Photo Illustration
City commissioners were right to strike a $1 million insurance requirement from new regulations governing short-term rental operators.
Requiring the insurance policy goes beyond the city’s role in establishing special-use permit requirements for short-term rentals. Such insurance isn’t required for long-term rentals.
Commissioners voted Sept. 19 to require special-use permits for short term rentals — properties that are rented by the night on websites such as Airbnb.com and Vrbo.com. But some commissioners expressed concern about the insurance requirement, and this week commissioners voted 4-1 to remove it.
Commissioner Lisa Larsen noted such insurance is not required for hotels or long-term rentals. “So I’m curious as to why we are applying this to this type of a situation when we don’t require it on other types of programs,” Larsen said.
Under the newly created regulations, licenses for short-term rentals require inspections, proof of taxes paid and adherence to the city’s parking and occupancy rules. City staff had recommended the insurance requirement.
“It’s a consumer protection to ensure that there is liability insurance to cover any events that occur at the property,” Director of Planning and Development Scott McCullough said. “As (Senior City Attorney) Randy Larkin mentioned last week, it’s a little bit different than long-term rental, where a tenant has the ability to get renters insurance to cover their possessions and matters.”
But Commissioner Matthew Herbert noted that the short-term rental industry is moving quickly to address insurance. He said Airbnb, which is one of the most popular sites, automatically provides both liability and property insurance to property owners that use their platform.
As we have said in the past, the special-permit regulations for short-term rentals protect homeowners’ rights to use their properties in a variety of ways while giving the city a tool to deal with nuisance properties. The new regulations also provide the public with an outlet to address concerns about neighboring properties operating as short-term rentals.
But the $1 million insurance requirement goes beyond the scope of what was needed and commissioners were right to remove it from the rules.