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Airbnb offers $50,000 insurance policy after user's 'nightmare'

August 1, 2011 |  6:01 pm

Airbnb Safety Center

Airbnb announced a $50,000 insurance policy and the formation of a 24/7 customer support hotline Monday after two users recently said their use of the company's travel services had left them the victims of vandalism and theft.

Up to this point, Airbnb -- a website that connects travelers with people who are willing to host travelers -- had been on a hot streak: It had landed high-profile celebrity and tech investor Ashton Kutcher as an advisor, as well as a funding round of $112 million, which valued the company at $1.3 billion.

In June, an San Francisco Airbnb user identifying herself as E.J. said on her personal blog that a person who rented her apartment on the website had trashed her home and stolen her jewelry, some cash and electronics, among other things. E.J. followed up that post with one Thursday accusing Airbnb of trying to get her to remove her original blog post as well as neglecting to help her recover from the "nightmare" of a situation.

Another Airbnb user, Troy Dayton, told the website TechCrunch that he too had his home vandalized by someone who had rented his apartment through the service and that he'd come home to find "meth pipes everywhere."

After a back-and-forth between TechCrunch and investors in Airbnb, Chief Executive Brian Chesky wrote a blog post Monday saying his San Francisco start-up hadn't handled its users' situations correctly and was looking to make things right.

"Last month, the home of a San Francisco host named EJ was tragically vandalized by a guest," Chesky said. "The damage was so bad that her life was turned upside down. When we learned of this our hearts sank. We felt paralyzed, and over the last four weeks, we have really screwed things up."

The CEO apologized for Airbnb's mistakes and said the last few days have given the company a "crash course in crisis management."

Chesky said that Airbnb is working with the San Francisco Police Department to set things straight for E.J. and that a suspect is in custody.

"I hope this can be a valuable lesson to other businesses about what not to do in a time of crisis," he said. "With regards to EJ, we let her down, and for that we are very sorry. We should have responded faster, communicated more sensitively, and taken more decisive action to make sure she felt safe and secure. But we weren't prepared for the crisis and we dropped the ball. Now we're dealing with the consequences."

In an attempt to "make it right," Chesky said Airbnb would launch its $50,000 Airbnb Guarantee on Aug. 15, which it says will provide up to $50,000 in insurance for any loss or damages at the property of an Airbnb "host" by someone who made their reservations through the company's website.

Next week, the site will launch a 24/7 hotline for its users to report any problems with its service or to complain about other users, he said. If an Airbnb user can't reach anyone when they need to, Chesky said he'd be reachable by email at brian.chesky@airbnb.com.

"We will extend this program to E.J. and any other hosts who may have reported such property damage while renting on Airbnb in the past," he said.

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-- Nathan Olivarez-Giles

twitter.com/nateog

Image: A screen shot of Airbnb's online safety page.

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