Who Rent Through
Rental home apps would need damage coverage backed by insurance
The Ohio bill sets rules for marketplace promises that reimburse hosts for renter-caused damage. It also says the guarantees must be posted online and treated as consumer deals, not insurance products.
Ohio renters who book through a marketplace could see a clearer promise on damage coverage. The company behind that promise would have to back it with reimbursement insurance and spell out the terms online.
- Online rental guarantees would need insurance behind them.
- The bill spells out who counts as a provider and a platform user.
- Guarantee terms would have to be posted on the company’s website.
- The promises would not be treated as insurance contracts.
- In Ohio, people who rent through an online marketplace could get a clearer promise that damage claims will be covered, and that promise would have to come with insurance behind it
In Ohio, people who rent through an online marketplace could get a clearer promise that damage claims will be covered, and that promise would have to come with insurance behind it.
The proposal defines a “rental home marketplace guarantee” as a contract or agreement tied to a marketplace that reimburses a platform user who offers property for rent for damages the renter is responsible for under the site’s terms of service.
It also defines a “platform contract holder” as the marketplace user who is the beneficiary or holder of that guarantee, and says a rental home marketplace is an online application, website or other medium that advertises property available in the state and connects users so they can share property. If it offers these guarantees, the bill says, that activity must stay ancillary to the company’s main lawful business.
Insurance behind the promise
The core protection is the backup. A provider would have to insure these guarantees through a reimbursement insurance policy issued by an insurer authorized to do business in Ohio or otherwise eligible to do so.
If the provider defaults or fails to perform, the insurer would have to pay the sums the provider owed under the guarantee.
The bill is also explicit about what these products are not. Rental home marketplace guarantees would not count as insurance contracts, and providers would not be treated as insurance companies. Even so, the guarantee terms would have to be posted on the provider’s website, and the promise would need to say that it is backed by reimbursement insurance and that a renter can go directly to the insurer if the provider has not paid within 180 days after proof of loss is filed.