Liability in the Share Economy Airbnb, Uber (Originally Posted by Sean Cecil Nov 10, 2015)


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Liability in the Share Economy

Originally Posted by Sean Cecil Nov 10, 2015  (0 Comments)
Today I read this tragic story about a father who died from injuries incurred in an accident at a Airbnb rental. For those who don't know, Airbnb, like its peers including Uber, are part of the "Share" economy where people make some money on the side from renting out their homes, offering a lift to a stranger, etc. Unfortunately, as detailed in the story, these disruptive businesses of the internet age are often far ahead of regulators, sometimes leaving customers in compromised positions. In many cases, insurance policies exclude damages from any commercial activity, leaving the question of liability up in the air.
Share economy businesses such as Uber and Airbnb are filling a market, but not without controversy. Taxi drivers, subject to a heavily regulated trade, rely upon the exclusivity of their business model to make a living- if anyone could slap a taxi sign on their car and start picking up fares, nobody could make a living doing it. Similarly, in cities such as New York and San Francisco where housing is at an extreme premium, houses and apartments are being removed from the housing market because owners can make more money in short term rentals (often to the anguish of their neighbors), increasing the difficulty and expense working people face in finding a place to live that is reasonably close to where they work.
It will be interesting to watch regulators catch up with this new business paradigm. In the meantime, these companies are potentially liable for placing convenience in front of the best interests of customers. As described in the article, when Airbnb makes money off of short-term rentals without ensuring the safety of the premises, there is a good chance they will have to pay for calamities that inevitably ensue.
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