Download the full transcript PDF.

[00:00:05] Sarah: Hello, listeners. Welcome back for another great episode. My name is Sarah Karakaian.

[00:00:09] Annette: I am Annette Grant. And together we are–

[00:00:11] Both Annette & Sarah: Thanks for Visiting.

[00:00:12] Sarah: And this is the–

[00:00:13] Both Annette & Sarah: Hosting Hotline.

[00:00:14] Sarah: Today we’ve got a question from Betsy.

[00:00:17] Questions: Hi there, Thanks for Visiting. Thank you for all you do for the industry. I’m on my second year of co-hosting because of you guys, and I’m just so grateful. Wanted to talk with you about damage waivers and using companies like Waivo. I’m using Waivo specifically and encountering some significant challenges with the loan income point.

[00:00:38] When communicating the coverage to guests, we want to be transparent and not give them false hope that everything is covered but also to– I quickly learned that, from my experience, the generous linen coverage that I thought Waivo provided was not that– things like standard bodily fluids that don’t come out are not covered, and that’s something that we’re encountering on one particular property of mine almost every turn on multiple beds.

[00:01:13] So that adds up quickly for the owners to have to be replacing all these linens. And I also want to make sure I’m not giving the guests the false sense of hope that they can just relax and not see a bill at the end of the day within reason. So any advice that you recommend, appreciate it. Thanks.

[00:01:35] Sarah: So first of all, Betsy is a member inside of our membership, so we’ve been coaching Betsy. We’ve got her some feedback immediately, but she first called into the Hosting Hotline, but it is a great question. And we know a lot of you out there, especially if you’re new co-hosts or you’re new to hosting, these small damages are of a big concern to you.

[00:01:55] And we understand that, but we’re going to give everyone, hopefully today, some tough, honest love on this topic. And we’re going to give you some really good advice when it comes to a damage waiver and a damage waiver program. And for anyone who doesn’t understand, so Betsy is talking about Waivo. Waivo is a product of Proper insurance.

[00:02:18] We use Proper insurance. We also promote Proper insurance because we use them, and we do love their service and their customer service and their founder. We believe in them. That being said, and this is where hopefully we always have your trust that we’re not just trying to sell you something, I’ve never actually used whether it’s Waivo or– I know there are other products out there like Safely, and Superhog offer damage waiver programs for hosts.

[00:02:46] I’ve never used them, and here’s why. I have the power of numbers behind me because I am also a co-host or property manager. And so what I do is I have my own damage waiver program in-house, and I’ll explain a little bit what that looks like, but it really is essentially the same thing that these companies are doing, where they have the buying power collective of all these hosts who pay a little bit into this pot.

[00:03:13] It’s also the same with Airbnb and AirCover. AirCover is essentially a damage waiver program where they take maybe a portion of your host fees or the reservation, and they put it into this pot and then we then have to write in and share what happened.

[00:03:29] And if they deem it appropriate, they give us either our full asking amount or a portion of it. And that’s what Betsy’s frustrated right now, because Waivo responded that the stains that have been left on these linens, they’re not covered because it’s normal wear and tear of a human sleeping in white sheets at night.

[00:03:50] And I understand Betsy’s frustration, but here’s the cool thing, Betsy. You’re a co-host, so you do have more than one property. If you’re listening right now and you have one property, two properties even, having your own damage waiver in-house may not be advantageous for you. You might actually benefit more from getting a program like Waivo, or Superhog has a product too for this.

[00:04:15] Safely has a product for this because you can then write in and see if you can get these small damages covered by these companies. But Betsy ended, Annette, her question with saying like, I don’t want to give my guests the false sense of hope they can sit back and relax, and that struck a chord with me because that is the sense of hope we have to give them.

[00:04:37] Annette: Let’s say that Waivo safely denies this. Still not charging the guest, especially when it’s something like sheets. The false sense of hope, that is what they’re signing up for. And just put yourself in their shoes on that. This is one of those things that we just see rampant. Let’s say Facebook groups are like, hey, wine keys missing. Sheets are stained. A bowl was broken.

[00:05:02] These are general cost of doing business. Of course, you want to try to save everything that you can, but again, as an industry, this is where the crazy checkout instructions or the nickel and diming on things that might be normal wear and tear, I’m sure that 99% of the time there is not malicious intent.

[00:05:20] If one of your sheets or towels gets stained at all, I’m sure that’s not the guest’s intention. So just think about that. You want to zoom out. I know that it might be happening on a multitude of time, but this is where we do have to have some SOPs on, what do we do if this happens with sheets and towels?

[00:05:38] Is there a way to treat these? And just remedy it. Yeah, that false sense of hope for your guest, you do have to make sure that if they are paying that damage waiver or something like that is covered. Even if the larger powers that be say, no, it’s not covered.

[00:05:54] Sarah: First of all, damage waivers. She asked, what do they cover? In most cases, it is unintentional accidental damage. And usually, it excludes pets. I can say that too. That is why people still collect pet fees. So if you’re a part of someone’s damage waiver program, it usually excludes accidental pet, like the pet accidentally goes to the bathroom in your home.

[00:06:15] The damage waiver program is probably not going to cover it. So I can tell you that much too. And let’s say though that this guest left a bunch of burn holes from smoking whatever, marijuana or a cigarette in the bed in the house. That is probably covered by a lot of these damage waiver programs.

[00:06:33] And Betsy shared with us what the stain looked. It does look like someone maybe, I don’t even know. Maybe it’d look like a coffee stain. I’m not sure. Or some sort of bodily fluid. I can see why they’re saying it’s normal wear and tear. And so that is what damage waivers usually cover.

[00:06:52] AirCover, if a guest books via Airbnb, leverage it. And I always preach that it’s not insurance, and that’s true. That doesn’t mean we don’t leverage it ourselves. Write in, send the picture, send them how much it costs to replace the set. You try to get it out. You couldn’t. And if AirCover sends you money your way, great.

[00:07:10] But since Betsy’s a co-host, I think she should do the damage waiver program in-house herself. You take a little bit from each guest, and it can be really small. So I think it depends on the size of the property. And so I’ll tell you what we do. If we have a one-bedroom, one bath property, we have a damage waiver of, I think right now it’s $15 per stay, all the way up to a high-end home where their average daily rate might be in the three or 400s.

[00:07:36] And of course, if you have a property higher than that, you can charge more. But for those properties, I think we were charging something like $80 for a damage waiver. You also take into consideration your average length of stay because you might be thinking, oh, what’s $15 going to do. But our average length of stay here in Columbus is three, I think three nights, maybe four nights.

[00:07:53] So you have to remember that you want to still stay competitive with pricing. But on our website and in your house rules, you say what that damage waiver covers, and your house rules never necessarily give a whole terms and conditions page. On your website, you should. You simply say that it’s intended for unintentional damages.

[00:08:14] But you collect the small amount, Betsy, from all of your guests, and you and your management agreement with your clients, you let them know this damage waiver is a program that is not optional for them. And all these funds go to you. And then you as a co-host, you have a separate account. We use Relay.

[00:08:30] And so we have a whole separate account where all of our damage waiver money goes. And when we need to tap into it, we do. Whether or not we let the guests know that we’re tapping into it, sometimes we don’t even tell them like, okay, there was a stain in a sheet or one of our hand towels. We can’t get this blood out, or whatever it is, or this bowl was cracked.

[00:08:46] I’m not going to tell a guest like, good news. This bowl was cracked, but the damage waiver kicked in. We’re just not going to bother them with that stuff. We go into our damage waiver pile of money, and we use it to pay it back. At the end of the year, we make sure we have enough in that pot for next year’s pot, and then we use a lot of that money for our team party as well.

[00:09:09] And it’s also a revenue maker for us. So if there is team party and enough leftover to start next year’s pot and we have still more leftover, that is profit in your account, and that is a great asset or a great add-on to making money in your hosting business. So I say you bring it in-house, Betsy, and then you are the decision maker.

[00:09:26] Annette: Let’s say you had, when we were just going off of those numbers, $15 per stay. Let’s say you have 100 stays per year. That’s $1,500. You have $1,500 to buy the new sets of sheets if needed, or maybe it’s plates, bowls, wine keys. That’s definitely going to cover any of that normal wear and tear or accidental things that might be happening with the guest.

[00:09:51] Sarah: You can still collect a security deposit if you want to. You can do whatever you want. But I will also say to Betsy, and we were talking with her about this inside our group, if every turnover in multiple beds, you’re having these stains that can’t come out, that is a red flag to me to have some training opportunities with the cleaning team.

[00:10:12] They’re just stripping the bed looking really fast at it and throwing in the washer and throwing the dryer, and then it’s setting, or the things that they’re using aren’t getting the stains out. We use and have used for a long time Fels-Naptha in our laundry systems.

[00:10:26] We just did an Instagram live with one of our members, Maura, who runs a high-end hotel, a company, out of Baltimore, and she likes to spritz it with hydrogen peroxide before she treats it. So we also have to look at ways that we can preserve this because this is going to be a huge– like you said, it’s expensive to get linens, and you cannot serve your guest a stained linen but clean bed experience.

[00:10:50] Annette: Yeah, that doesn’t work.

[00:10:51] Sarah: Okay. Anything else, Annette, that we left out? I went on a rant, but I went on a rant because I love my damage waiver program, and it’s a huge way that we add revenue to our co-hosting business. But also, I don’t sweat. Sometimes I don’t even sweat replacing a rug or replacing an entire sofa. I just don’t sweat it, especially if it was truly accidental. Or if it was, hey, it’s time for a new one, and the guest didn’t even do anything. You can also tap into it for that. You can do whatever you want because it’s your program.

[00:11:21] Annette: And if you’re not familiar with the damage waiver, again, this is stuff that you do have at your disposal, not just AirCover hosts.

[00:11:28] Sarah: That’s right.

[00:11:29] Annette: All right.

[00:11:30] Sarah: Betsy, I know you’re going to crush it. These sorts of challenges are normal.

[00:11:34] Annette: Yeah.

[00:11:34] Sarah: You got to work through them.

[00:11:36] Annette: That’s the truth right there.

[00:11:38] Sarah: With that, I am Sarah Karakaian.

[00:11:39] Annette: I am Annette Grant, and together we are–

[00:11:41] Both Annette & Sarah: Thanks for Visiting.