Committee advances bill defining short-term rental platform 'guarantees' and gives Department of Insurance oversight
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Summary
The committee gave HB296 a favorable report as amended after extended questioning about whether platforms host-damage guarantees count as insurance, how claims would be handled, and what financial backstops would be required; an exemption was adopted for companies with an in-state principal place of business.
The House committee advanced HB296 on a voice vote after adopting an amendment that exempts companies with a principal place of business in the state from certain requirements.
The bill, presented as a technical framework for online rental marketplaces, would define a host-damage guarantee that some platforms offer as a "perk" for listing properties and set rules for when such guarantees must be backed by reimbursement insurance and Department of Insurance oversight. Toby Roth, representing Airbnb, said the company views its host damage protection as a contractual guarantee rather than an insurance product and that Airbnb does not charge hosts for the feature. "They cover up to $3,000,000 in bodily and 1,000,000 in property reimbursement," Roth said, describing existing limits Airbnb offers to hosts.
Committee members repeatedly asked how guarantees would be priced, where liability limits would appear, and what recourse homeowners would have if a platform declined a claim. Representative Campbell asked about contract language and whether homeowners could be left relying on small-print exclusions. Roth said the bill gives the Department of Insurance the authority to impose standards and to require financial solvency measures for companies that elect to offer guarantees so the promises can be met.
The committee adopted an amendment that exempts management companies and other firms with a physical principal place of business in the state from some of the bills requirements; committee members said the change reflected requests from local property managers. Representative Colvin moved the favorable report and Representative Easterbrook seconded; the committee approved the bill with one member recorded as abstaining.
The bills backers said it is model legislation drafted by the National Conference of Insurance Legislators and is intended to provide statutory clarity and a rulemaking path so courts and regulators are not left to resolve disputes in piecemeal litigation. The Department of Insurance will undertake rules to set appeals and claims-handling processes if the bill becomes law.
Next steps: the bill will proceed in the legislative process as a committee-recommended measure.