Weather can be unpredictable. Recent hurricanes and flood events in the Caribbean, Florida, Louisiana, and Texas have shown that, as did the tragic fires in Northern California. Your corporate rental is a major investment that you want to protect. Having homeowners insurance should be a given, as well as flood insurance in low-lying areas requiring you to be covered. Beyond insurance there are other ways you can not only prepare your home but also protect yourself from income lost to severe weather that prevents a tenant’s stay. Here are three ways you can prepare your short-term rental for severe weather.
Supply “Must Have” Items in Your Corporate Housing
Just like you would in your own home, provide basic emergency supplies for corporate tenants. Bottled water, canned food, a first-aid kit, a hand-crank radio, flashlights, and an emergency kit are important to have on hand. Secure these items in a cabinet with a combination lock. When extreme weather occurs, provide your tenants with the combination. Finally, be sure your home is well maintained both inside and out. If high winds, heavy rain or snow strike, be sure your home is up to the challenge.
Offer Travel Protection Insurance for Hurricane Rentals
In some states where vacation rentals are more common, if you do not offer your tenants a travel insurance option, and a mandatory evacuation prevents a stay, you must refund them. However, if you offer them insurance, no refund is required. In other states, no refund is required unless your lease agreement covers it. You’ll need to know the laws regarding severe weather refunds in your state and municipality, run it by the attorney drawing up your standard lease contract.
This is distinct from a security deposit because it is different than “tenant caused” damages. CHBO’s covers you in case of tenant accidental damage, a cost that can be passed on the tenant in lieu of a security deposit.
Add a Severe Weather Clause to Your Lease Agreement
In the case of a mandatory evacuation, you could offer a refund or a rebooking at a discount. But you need clear language that only mandatory evacuations apply; guests who are simply disappointed because rain is predicted can’t get a refund, as the home is still usable.
In the case of mandatory evacuations, you could issue a refund in advance when government authorities declare the evacuation, or if the stay is in progress, partially refund for unused days, or credit guests for a future stay.
Again, be clear that this applies only in the case that your property cannot be used due to evacuation. This happens most often with severe storms or hurricane rentals, where there are a few days of advanced notice. If roads are icy but not closed, for example, this doesn’t mean a refund as your short-term rental itself is still usable and the tenant should use chains or winter tires with four-wheel drive.
You may not be able to predict when and where severe weather strikes. You can, however, prepare your corporate rental for hurricanes and your lease as best you can so that when bad weather strikes you are ready.