Reviewed and updated on 5/7/2020
Killington Planning Commission introduced a short-term rental registration and permit proposal to the Select Board to review on January 8th. The proposal was introduced amidst an on-going court case involving a short-term rental which was granted a safety permit allowing up to 28 occupants. Despite the permit, the house underwent septic failure as it was not able to sustain the number of guests. City officials hope to determine regulations and safety guidelines to lower the likelihood of such a scenario occurring again.
According to Town Manager Chet Hagenbarth, “at least 30 additional properties are in violation, with various resulting issues.” The City hopes to educate local hosts to the appropriate safety measures to protect their property and continue running a successful business.
It is not a surprise that the City hopes to secure more thoughtful short-term rental regulations. According to Preston Bristow, interim zoning administrator, the town’s 820 full-time residents have the largest number of short-term rentals in the state – 931 listings.
Hosts are currently not required to provide proof of short-term rental insurance or an inspector’s approval, while their written confirmation is accepted for these requirements. Hosts may simply affirm they have the appropriate documents, while the City does not require copies.
Update: As of May 5th, Killington, VT now requires hosts to provide proof that the liability insurance policy covering the dwelling unit extends bodily injury and property damage insurance coverage that occurs during or as a result of the use of the dwelling unit as a short-term rental (section 407.F of the Zoning Bylaw Amendments).
How to insure your vacation rental property
As mentioned above, Cities may require hosts to have insurance in place for their short-term rental, but stop short of requiring proof of this insurance.
With the explosive growth of short-term rental properties found on websites such as Airbnb and Vrbo, communities are struggling to find common ground regulation. Many communities have passed ordinances and laws which all have some type of insurance requirement. The concern is most are inadequate and often misleading.
Proper Insurance recommends that Cities define the type of insurance in a given regulation to be “commercial general liability.” It is readily available for purchase in the open market for short-term rental owners. Too often, “personal” or “premise” liability will not suffice for short-term rentals.
Proper Insurance also suggests the Cities require proof of insurance in the form of a COI. In the insurance industry, all carriers use a standardized form called a “certificate of insurance” or COI to show proof of insurance to various interested parties, including banks and mortgage lenders.
Other hospitality entities including bed and breakfasts and hotels carry commercial general liability. Short-term rental properties should be no different.