Keynotes by Casago

Steve: 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.

I'm here today with John Slaughter
from rental guardian, talking about

the Costco protection program.

Welcome, John.

Hey, Steve.

How are you?

Pretty good, . So today we're talking
about the Costco protection program and

how it benefits the Costco homeowners.

And I guess for the very first
question, we should probably ask you.

John, what is the Costco
Protection Program?

Speaker 2: 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.

Steve: 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.

So for number one, can you explain
how the buying power of Costco?

was used to create this
program for our homeowners?

Speaker 2: 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 But at the same time, whether
a franchise had one property

or 10, 000 properties, they all
had access to the same coverage

to deliver to their homeowners.

Speaker: So, for number two,
you put liability coverage.

Speaker 2: 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.

Speaker: 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.

And.

As a homeowner, having that extra
million dollars of liability

is just a lot of peace of mind.

Speaker 2: 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.

Speaker: So you said that the third
thing we need to know about the Costco

protection program is structure coverage.

Speaker 2: 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.

And so instead of just a stovetop
fire, it's a full kitchen fire.

And that is now not just a $2,000 claim,
but it's a 25,000 or $250,000 claim.

And so what this program brings to
the table is $1 million of structure

coverage to be able to protect the
structure of the home against those

types of risks that can occur.

Speaker: It's so great to have.

So for number four, you said of the
things that homeowners need to know.

Speaker 2: 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.

Um, traditionally found in a vacation
rental or a short term rental that

could be damaged, whether it was the
floors, cracked tiles, as well as

carpet stains, all the way up into
the appliances, tables, chairs, TVs,

lamps, refrigerators, stuff like that.

Speaker: 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?

But our broker here was able to
call Rental Guardian and get the

Costco Protection Program started.

And sure enough, the entire
couch was covered 100%.

The homeowner was so happy.

Her name is Linda.

She got a brand new couch.

It's already in, hassle free.

And she's already back to renting,

Speaker 2: 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.

I mean, it's just a value of the program
and what it's meant to do, which is

protect the contents of the unit.

Speaker: Yeah.

So for number five, we
have bed bug coverage,

Speaker 2: 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.

Also, put the guest up into another
accommodation, and then, you

know, get the exterminators out
there, get rid of the bed bugs.

Then they're going to replace the soft
furnishings that were impacted, and

then they're going to be able to, if
the next rental is impacted, after 72

hours and the home is still down, being
treated for the bed bug situation,

and not ready to rent again, then they
can also start claiming lost revenue.

Speaker: Such an important program.

You know, we've had some bed
bugs happen over the years.

And it can be devastating.

Speaker 2: It really can.

Speaker: Yeah.

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

You

Speaker 2: know, I start
to squirm a little bit.

Did you see me squirming in my chair?

Speaker: 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?

Speaker 2: 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.

Speaker: Yeah.

Speaker 2: Yeah.

Speaker: 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,

Speaker 2: is

Speaker: through

Speaker 2: the grocery store.

That boggles my mind.

Speaker: 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

Speaker 2: had never seen
a bed bug myself either.

Like a myth.

Yeah.

Yeah.

Yeah.

Are they real?

Are they not real?

Speaker: Yeah.

Speaker 2: Trust me.

If you get them, they're real.

Oh man.

Speaker: 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.

Secondary coverage.

Speaker 2: 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.

Of course, that typically would not cover
commercial rental activities, but because

this program is, is available through
the Costco property manager, they are

additionally insured as a homeowner and
they can use this from the time the guest

checks in to the time the guest checks
out, which is when they need the coverage.

Otherwise it's.

It's the traditional homeowners policy
would be in place for, you know, when

they use it or whatever the case might be.

But when the commercial rental
is in there, check in, check out

the right coverage is in place.

Speaker: 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?

And it's fantastic to have this
secondary coverage with a product

that's specifically designed for the
short term rental industry negotiated

by Costco to have this coverage in
case your own insurance company doesn't

cover it, or the coverage is exhausted,
or if it's something out of the norm

that Your normal insurance company
wouldn't know how or want to cover.

Speaker 2: 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.

Speaker: 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.

Policies are a per booking policy, and
maybe you can explain what that means.

Speaker 2: 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.

I used to say three to four times,
I was told that the most recent show

that I was at In Boise, Idaho that
somebody was quoted up to 10 times as

much as they would normally pay for a
traditional homeowners policy That's

a lot of money and it's per year.

And so you basically whether you rent
your home 25 of the time or 30 or 50 or

70 you're basically paying for an entire
year With no break given for the time

that it's not rented with our program.

It's per booking So there's two things
that are super important to know

number one You You're only paying
for the time that you're using it.

And number two, it's not a million
dollars in liability per year.

It's a million dollars per booking, which
means guest number one files a lawsuit.

There's a million dollars to cover that.

Guest number two causes a kitchen fire.

There's a million dollars for that.

are astronomical numbers when you
think about it, because you go

from say 1 million, 2 million, 3
million, maybe per year to a million

per booking to cover those things.

It just means that you have literally
protection when you need it most and

you're only paying for what you use.

Speaker: 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?

Speaker 2: 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.

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

Speaker 2: 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.

There's no paperwork to fill out.

There's nothing that you need
to do other than to say yes

to a Costco property manager.

And even this is something
that we didn't cover.

Let's say for instance, You're in a
neighborhood or a town that needs a permit

and you have to show liability coverage.

We can also then, because of this
program, provide that form to be able

to send that into that entity to be
able to get that permit taken care of.

So because you work with Costco,
you get access to this program

and it's just second to none.

Speaker: 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.

Speaker 2: Appreciate that.

Speaker: Thanks again.

Speaker 2: Yeah.

My pleasure.