Top 10 Reasons Vacation Rental Owners Prefer Damage Protection vs. Damage Deposits

For most vacation homeowners and managers, the days of collecting damage deposits for a rental stay are gone.  Here’s a quick list of 10 reasons why so many lodging providers prefer damage protection:

1. Simplified Process: collecting and returning damage deposits are a hassle! You must collect the funds, deposit them, inspect for damage and then return at the end of rental assuming no guest damage. It's an involved process.
2. No Need for a Separate Escrow Account: If you are collecting damage deposits, you really need to have a separate escrow account to which you can deposit the funds.  This money belongs to the guest and not you and therefore should not be commingled with your operating funds.  Escrow accounts are really just temporary holding accounts you set up with the bank.
3. Damage Protection Benefits Both the Lodging Provider and Guest: Letting a guest know that you are charging them for damage rarely sits well with the guest.  Damage protection is meant to cover both the guest and the lodging provider whereby in the event of accidental damage, both parties are happy that the insurance is in place.
4. Guests Prefer Damage Protection: Guest surveys have shown that guests prefer to pay a reasonable fee for damage protection rather than tying up their money for long periods of time as a deposit against accidental damage. The number is big; 75% according to HomeAway.
5. Returning Guests:  Happy guests are likely to return for another stay.  End the stay on the topic of paying for damage, they are likely to find another accommodation next time.
6. You Determine the Guest Fee: Most lodging providers elect to pass the cost of the damage protection policy along to the guest as a ‘accidental damage protection’ fee with each reservation. You determine if that is at the retail cost or some other amount.
7. Eliminates the Bad Guest Review:  Take money out of the pocket of a guest and you open yourself up for a bad review.  It’s the guest’s way of ‘getting even’.
8. Holding a Credit Card is not ideal: Credit card chargebacks are common when lodging providers attempt to use them to pay for damage.  The credit card company will typically side with their customer when a dispute arises.  If you hold a credit card there is a good chance you will be left holding the cost for repairs.
9. Hassle Free Claims Process:  In the event of damage, you complete an online form, upload a photo of the damage and copy of the receipt for repairs or replacement.  Claims are paid in 30 days or less.
10. Damage Protection is Available Online:  The process is quick and easy when purchased from Protection Brands, a RentalGuardian.com company.  Just visit www.getdamageprotection.com and register.  Once registered its easy to purchase a policy.  The website is designed to allow you to save your property and credit card information, if desired for even faster visits for future purchases.

If you are among those who are still managing damage deposits, you may want to consider the benefits of implementing a damage protection plan.