Introduction
Many investors in the UAE worry about one thing when starting a short-term rental business: "What happens if a guest damages my property?"
This is a valid concern. You have invested a lot of money into furnishing your apartment or villa. The good news is that Dubai has strict rules to protect owners. The Department of Economy and Tourism (DET) has clear frameworks for safety.
With mandatory insurance, security deposits, and clear reporting rules, your property is safer than you think. This guide explains how to handle guest damages in Dubai and the steps you must take if accidents happen.
The First Line of Defense: Mandatory Insurance
Operating a holiday home in Dubai without insurance is against the law. The DET requires all licensed holiday homes to have full insurance coverage.
This is different from normal home insurance. A holiday home policy covers risks related to paying guests. These policies usually cover three main things:
- Building Damage: Issues with the structure caused by accidents.
- Contents Damage: Protection for your furniture, appliances, and decoration.
- Public Liability: Coverage if a guest gets hurt while staying in your property.
Platforms like Airbnb offer their own protection (like AirCover), but this does not replace local UAE insurance laws. You cannot rely only on the booking platform.
Understanding Security Deposits
A security deposit is the best way to pay for small accidents. In Dubai, it is standard to take a refundable deposit. This money is held during the stay and returned after check-out if there is no damage.
What can a security deposit cover?
- Broken plates or glasses.
- Stained sheets or towels that cannot be cleaned.
- Lost keys or access cards.
- Extra cleaning needs (messier than normal).
You cannot keep the deposit money without a reason. You must show proof of the cost to replace or fix the item. Professional management agencies usually handle this for you.
The Difference Between 'Damage' and 'Wear and Tear'
Problems often happen when owners mix up 'real damage' with 'normal wear and tear'. Under UAE rules, you cannot charge guests for the natural aging of the property.
Examples of Normal Wear and Tear (You cannot charge for this):
- Faded curtains from the sun.
- Small marks on walls from suitcases.
- Worn edges on a rug.
- Loose door handles from regular use.
Examples of Claimable Damage (You can charge for this):
- A red wine spill on a white sofa.
- A hole in the wall.
- A broken window.
- Burn marks on a table or carpet.
Knowing the difference helps you avoid arguments and legal disputes.
Step-by-Step: What to Do When Damage Occurs
If you find damage after a guest leaves, you must act fast. Insurance companies and booking sites have strict time limits (often 24 to 48 hours).
1. Document Everything Immediately
Do not clean up yet. Take clear photos and videos. You need "before" photos (from check-in) and "after" photos (showing the damage).
2. Check the Inventory List
A signed check-in list is your best tool. If the guest signed a paper saying the TV worked at check-in, and it is broken at check-out, you have proof.
3. File the Report
- For Minor Damage: Tell the guest immediately. Explain why you are keeping part of the deposit. Show them the receipt for the replacement.
- For Major Damage: Call your insurance provider right away. They will tell you which forms to fill out.
4. Police Reports
In Dubai, some claims require a police report:
- Theft or Vandalism: If items are stolen or broken on purpose, you must file a report with the Dubai Police (often via their app).
- Fire: Any fire damage needs a report from the Dubai Civil Defence.
5. Use Licensed Contractors
Always use licensed UAE companies for repairs. Insurance companies might reject bills from unlicensed handymen. Keep all official invoices.
FAQ: Common Questions About Guest Damages
How much should I charge for a security deposit?
The amount depends on your property. A studio apartment will have a lower deposit than a luxury villa on the Palm Jumeirah. Management companies set these rates based on market standards.
Can I get money for lost rent while the property is being fixed?
Some insurance policies cover "loss of income" if the property cannot be used (like after a fire). However, for small repairs, lost rent is usually not covered. Check your policy details.
What if the guest refuses to pay?
If the damage costs more than the deposit and the guest won't pay, you can use the booking platform's resolution center. If that fails and the amount is large, you may need to file a case with the Dubai Rental Dispute Center (RDC).
Do I need a police report for a broken window?
If it was an accident, usually no. But if it looks like someone broke in or did it on purpose, a police report is required for insurance.
How does a property manager help?
A property manager handles everything: checking guests, collecting deposits, inspecting the home, and filing claims. This saves you time and stress.
Conclusion
Guest damage can be stressful, but Dubai's laws are designed to help owners. If you have the right insurance, keep good records, and know the rules, your risk is low.
If you want peace of mind, hiring a professional management team ensures these steps are followed perfectly for every stay.
Curious about how much your property could earn with professional management? Get a free estimate today.