Understanding the Casago Protection Program with John Slaughter.

Welcome to Keynotes, a podcast just for Costco homeowners. This is where we explore how to get the most out of your relationship with Costco, learn tips and tricks on how to make more income with your property, and learn a little bit about the short term rental industry along the way. I've been a vacationer since my twenties, and the team has finally let me have this podcast so I can share everything I've learned with you. I'm your host, Steve Schwab. And this is keynotes keynotes.

The Costco Protection Program was custom built for Costco homeowners to protect them against the day to day damages and liabilities and risks that come from renting your home as a commercial business.

And so, John, you gave us eight things that homeowners should know about when it comes to the Costco Protection Program, and I'm just going to go right down the list and ask you about each one, if that's okay. Sounds good.

Yeah, absolutely. So because Costco, uh, at the time we've created this program had just over 3, 000 units um, we were able to aggregate everyone as a whole instead of underwriting each Costco franchisee individually. And so what we're able to do is drive down the pricing of the program to be able to deliver a world class program unlike any other.

So, for number two, you put liability coverage.

Liability is such an important component of the program. And there's a million dollars of coverage for liability to protect against things that can occur when somebody gets injured and the guest claims that the homeowner and the property manager and everybody involved in the process was liable for their injuries. And so, with this program, it covers that up to a million dollars.

You know, I just, last week, got a call from a friend, not part of Costco, but you know, somebody in the industry, He had somebody fall down his stairs and they broke their back. And he had to call the homeowner and let them know. And so now the homeowner was concerned. He didn't know quite what to do next. I told him, you know, let's have a discussion. And we, we walked through the steps, but he didn't have this protection.

It really is. And whether a homeowner has their own liability coverage that will stand up in a commercial situation, or whether they have their own homeowner's policy, this will protect as a service from the time the guest checks in to the time the guest checks out up to a million dollars for those liability claims that come in. It's such a great product.

So you said that the third thing we need to know about the Costco protection program is structure coverage.

Yeah, you know, I'm sure homeowners when they're thinking about renting their home as a business, two things hit their mind. What happens if somebody gets hurt and what happens if somebody causes a fire or there's water flood or overflow or something of that nature. And the structure of the home is when a. Situation occurs where the damage is not just to an appliance, but to the structure of the home, meaning it's gotten into the studs.

It's so great to have. So for number four, you said of the things that homeowners need to know.

You know, the contents is sort of the day to day damages that can occur from a guest being on site and not being familiar with how to run the appliances or whether or not the TV is a swivel TV when they're trying to eat dinner at the table and they pull it off the wall accidentally and cause those damages. So think of it as anything that's inside the home.

Here in Scottsdale, we just had an incident that the Costco Protection Program covered. It was for a leather couch, and there was a massive water damage on a leather couch, unrepairable. And the homeowner was really concerned like, Oh my gosh, I got a few thousand dollars for this rental, but now I'm going to pay a couple thousand dollars for this couch. This is obviously not a good business deal going on here, right?

you know, that's a great situation that talks to the value of the program. The contents protection is up to 25, 000 of total coverage. There is a 5, 000 limit for any one item. You said she just renovated the home too. So it was like six months old. And now all of a sudden you're thinking you're gonna have to come out of pocket for that. And the property manager was able to file a claim. Get it reimbursed quickly and replace that sofa.

Yeah. So for number five, we have bed bug coverage,

our favorite thing. Yes, you know, nobody likes to talk about bed bugs and they can certainly be a reputational risk with reviews and things of that nature. The cool thing about this program is that there's 15, 000 of bed bug protection. And what that does is it allows the Costco property manager to act quickly, get the exterminators out there and remove the bed bugs first and foremost.

Such an important program. You know, we've had some bed bugs happen over the years. And it can be devastating.

It really can.

Yeah. By the way, are you itchy right now talking about bedbugs? You

know, I start to squirm a little bit. Did you see me squirming in my chair?

Yeah, I was, I felt like I needed to scratch my hair every time you said bedbugs. It's not good. It has a creepy feeling. Yeah. Do you know the number one way that bedbugs come into homes?

You know, I was going to, and I typically say that it's, uh, somebody stopped off at a hotel somewhere and they were brought to them in a suitcase.

Yeah.

Yeah.

Yeah, I mean they travel through suitcases and things like that, but the number one way that bed bugs come to our homes, to include vacation homes,

is

through

the grocery store. That boggles my mind.

Yeah. Fruit. Fruit. Yeah. The reason why bed bugs exploded again was because they changed the law about pesticides. And so they reemerged when they changed the laws. So that's why we have this bed bugs again, because growing up, I'd never seen it, but I

had never seen a bed bug myself either. Like a myth. Yeah. Yeah. Yeah. Are they real? Are they not real?

Yeah.

Trust me. If you get them, they're real. Oh man.

So for number six, I didn't quite understand what you meant by this. So I'm going to ask you to help explain it better.

So that pertains to if the homeowner has a commercial grade coverage already in place, then this program would back it up and be a secondary coverage to be able to provide additional coverage for if the limit was exhausted on the first coverage or there was a claim that was over the amount and this coverage would kick in. What's great about this program is, is that it can also act as a primary coverage if the homeowner keeps their traditional homeowner's policy.

It's so important. You know, I can't tell you how many times I've always wondered, you know, will my insurance cover me on this? And a lot of. insurance policies for residential, even if you change it over to letting them know that this is a vacation rental, there's always that question in the back of your mind, how are they going to play this out?

Yeah, that's such a great way to be able to talk about the program is, is that it was created specifically for this niche. And in that, it is something that is unlike anything else. It's not going to cover anything, but Guests checking in to a vacation or short term rental and from the time they check in to the time they check out the specific coverage that's needed to cover against the risks and the perils that can come from renting a home as a business. This is there to take care of that.

Yeah, there's only really a charge when guests are actually in the property, not in between. And that brings us up to number seven, that the.

Sure, so traditional, either commercial coverage or something of that nature will be per year. And many times, if a homeowner has tried to go and buy a commercial coverage for specifically short term vacation rentals, they've seen how expensive it can be.

Yeah. It's perfectly designed for what we're doing here. And I'm really proud to be offering this to our homeowners because it's important that if our homeowners are here to rent and earn income from this to minimize those liabilities that are coming towards them, right?

You don't know what you don't know until one comes along and those things can be very, very, very expensive. So a program like this serves that need and protects you when you need it most.

John, our last one, number eight, exclusive to Costco.

So basically what that means is we only work with. professional property managers. And this program was created for Costco property managers to then be able to deliver to their homeowners as additionally insured. And what that means is that if a homeowner were to try to call us directly, we aren't able to work with them and there would not be a program available to them like this. So the value is, is that when you work with a Costco property manager, you get access to this amazing program.

John, thanks so much for coming on. I really appreciate your time and I know our homeowners will appreciate it. You're always so much fun to talk to. Really enjoy it.

Appreciate that.

Thanks again.

Yeah. My pleasure.