Tourism is one of the biggest contributors to South Africa’s economy and GDP. Every year, over 3.5m tourists visit us from overseas. The domestic tourist industry is harder to quantify, as many local tourists are day trippers, but statistics show it’s worth in the region of R63 billion. So, it’s probably safe to say there are vast numbers of tourists staying in hotels and other types of accommodation throughout the country at any given time.
Given these kinds of numbers, the law of averages dictates that something will go wrong at some point! Fortunately for people working in the hospitality industry, significant damage to hotel property by a guest is quite rare. Most problems are confined to the odd accidentally broken glass or coffee spill on the duvet or carpet. These, and other small problems are easily rectified and usually covered by the contingency built into the room rate anyway.
Self-catering establishments and holiday rentals face an increased risk of more expensive damage, but the most common problems are usually covered by the damage deposit charged at the time the booking was made.
But what happens when the damage is malicious and more extensive? Who is liable for the costs then, and will your insurance cover you in this instance?
What Is Malicious Damage To Hotel Property?
Guests will usually report any accidental damage to the hotel reception. A careless cigarette burn on the armchair, a broken TV remote control…these things happen. Malicious damage, on the other hand, is damage caused deliberately or willfully, with the absolute intent to cause destruction.
We’ve all heard stories of chemically enhanced rock bands trashing hotel rooms and causing costly damage. In some extreme scenarios, rooms have even been set on fire, which then spreads to other parts of the hotel, destroying property and endangering lives. In cases like these, the cost of repairs is usually claimed from the rock bands themselves, who fortunately have the funds to pay for damages.
Who Pays For This Damage?
But what happens when the people causing the damage aren’t millionaire rock stars? In a situation where there is significant and deliberate damage to a room, the standard protocol is for hotel management to photograph the room once the guest has left, and take witness statements from staff. A quote for the damage is then calculated (including the cost of not being able to rent out the room), and a request for payment sent in writing to the guest concerned. A guest’s rights in a case such as this are pretty limited, and they will have to pay or face possible legal consequences.
It’s worth noting, however, that the hotel may not make an unauthorised deduction from your credit card. If they do so, the guest is within his rights to ask his bank to reverse the charge. For this reason, more and more hotels are now adding a clause to their check-in document stating they reserve the right to make a charge against a guest’s credit card. This is one way of covering themselves in case of malicious damage to hotel property by a guest.
Does Hospitality Industry Insurance Cover Damage By Guests?
In certain instances, where damage is accidental and reported to the hotel by the guest, the hotel can claim against their insurance. Insurance policies differ from provider to provider, so it’s essential to make sure your coverage meets your needs. Most reputable insurance companies will tailor make packages for their clients, so can include coverage for any non-standard risks.
Your standard insurance coverage should protect against the following:
- Legal liability arising from the injury to, or death of, a guest, or the loss of, or damage to, their personal property.
- Property owner’s liability
- Product liability
- Booking cancellations
- Damage to landscaping and water features
- Food and drink poisoning
Depending on the nature and location of the hotel, additional cover can be arranged for such things as:
- Game viewing vehicles
- Golf carts
- Buses and shuttles
- Hunters’ liability
- Breakout or relocation of wildlife, or attack by game
At CC&A Insurance, we offer expert advice based on your individual requirements. We assess your particular risks and exposures and recommend specific insurance products to cover those risks. Our advice is based on over 200 years of combined industry experience, so if you’re looking for comprehensive hotel insurance, contact us today.