If you want to be relaxed on an exchange you should be well insured. It is a good time to think about your coverage.
The House
From a legal point of view home exchange is similar to an invitation from a friend, because it is not a commercial transaction. As a result, your home owners insurance should take care of any losses while you are gone such as fire, water damage, theft, etc.
In certain countries home insurance is not required. Insurance laws vary. In the European Union there is little to worry about but outside Europe things can be complicated. If you have damaged your exchange home you should use your personal liability insurance to compensate your partner. Be alert, verify before your departure the geographical coverage of your insurance and if necessary take out a policy of personal liability insurance for travel.
If it is your partner’s insurance that will take care of damage that you have caused, you will have to pay the deductible. It is recommended that you think about the possibility of insured damage and specify the deductible amounts in the exchange contract.
Your guests could hurt themselves at your home and file a claim against you if they have proof of negligence. Assure yourself that your personal liability insurance covers the occupants of your house.
Insurers generally welcome house swappers as they know that the possibility of theft is reduced. The first time you exchange you should meet with your insurance agent and verify that your coverage is adequate.
The Car
Never accept an exchange if the car of your partner (or yours) isn’t covered against all risks. The insurance must cover all drivers. If there is a requirement concerning a minimum age (generally 21 years old) you must keep it in mind. It is indispensable to indicate on the exchange contract the amount of the deductible, the maximum amount of coverage (especially for bodily injury) and the persons authorized to drive the vehicle.
Before leaving it is advisable to tell your insurance agent and send him the names of your exchange partners that will be driving. He might ask for a copy of their driver’s license or the certificate of insurance on their own vehicle.
Travel Cancellation
The cancellation of an exchange is rare though nobody is immune to health problems. Travel cancellation is often included in your travel insurance, which you may take without knowing that it may be included as a free benefit of your credit card.
Your trip cancellation insurance allows you to recover what you paid for your tickets if you or a member of your family isn’t able to travel for health reasons.
If your partner has cancelled the exchange the situation is different. In this case you have a true problem. Exchange agencies will help you by trying to find another partner in your chosen country. This is a makeshift and uncertain process.
Homelink is the only exchange agency to propose a solution to Europeans (Exchange Cancellation Insurance) that will reimburse you up to 2000 Euros for a cancellation less than 30 days before your departure. HomeExchange.com used to have an exchange cancellation insurance, this is no longer offered.
North American readers have more options; they can take an insurance policy specifically crafted for home exchangers by ChecTravel. The home exchange agency Geenee also has an insurance option for North Americans.
Translator’s Notes.
Insurance rules vary by country, as Didier recommends you should consult your insurance agent. Trip cancellation insurance for home exchange is a new innovation, many home exchange agencies have experimented with policies, please expect changes in their offerings. Homelink USA and HomeForExchange offer forms of home exchange travel cancellation insurance. If your exchange is cancelled at the last minute you should always contact your home exchange agency for help and advice. One last insurance tip: always back up your computer hard drives before leaving your home to an exchange family.
Translated by John Mensinger.
To read Didier’s post in its French original
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When you live in the USA, you have the possibility of purchasing an umbrella insurance.
I recently heard of a case where somebody rented a boat and ran into another boat.
The rental agency did not have insurance to cover the damage to the other boat, which ran into $ 12.000. Without umbrella insurance you could be in deep financial trouble.
Unfortunately, in The Netherlands such an insurance cannot be bought.
When I rent/drive a moped, scooter, boat with an engine more than 5HP, my liability insurance does not cover the damage to other people(s belongings).
I will have to read the fine print to see if that’s covered by the rental agency.
If not, I will have to purchase it through them or willingly accept the risk.