Coronavirus - cancellaitons - and how to respond to guests

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Sunbeam
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Coronavirus - cancellaitons - and how to respond to guests

Post by Sunbeam »

EDITED: I've removed my original questions because so much has changed over the last few days that it is out of date.

Basically was asking how to explain to guests that they should claim on insurance when there is a travel ban rather than expect to move a holiday or get a refund.

But today (18 March 2020) the FCO has updated their advisory:

The Spanish government has now ordered that hotels and short-stay accommodation (such as short-stay campsites or caravan parks) must close by Tuesday 24 March.

I tried to add a link but can't figure out how to - but checkout the UK FCO

Thanks to all and best wishes
Last edited by Sunbeam on Wed Mar 18, 2020 9:54 pm, edited 3 times in total.
zebedee
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Post by zebedee »

From what you say, the insurance company have not refused the claim, but are looking to minimise their loss by asking if a holiday can be deferred.

It is not for you to determine the definition of what a state of emergency - that is for the insurance company.

Your points are all clearly argued, and I particularly agree with you with regards to people you employ.
I would reply explains things as clearly as you have done in your post.
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CSE
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Post by CSE »

Officially it is not a state of emergency.
Officially it is a state of Alarm. there 3 levels of measures where the State can take control in Spain.
https://www.boe.es/legislacion/document ... INGLES.pdf

It has not stopped travelling as many Madrileños have taken flight from the city to their vacation homes.
https://www.lavozdegalicia.es/noticia/s ... 490301.htm
https://www.laverdad.es/murcia/cartagen ... 27-nt.html
https://cadenaser.com/emisora/2020/03/1 ... 32983.html
This will not stop the spreading of the virus.
Never try to out-stubborn your guests.
Sunbeam
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Post by Sunbeam »

Thank you Zebedee for your comments.

And thank you CSE - especially the very useful link to the Spanish Constitution in English - page 32 explains the three different levels of alert. Also for the other links.
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Bassman
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Post by Bassman »

I just start a new post in the France section of the forum regarding this, as i had guests cancelling Thursday evening who were supposed to arrive the next day. They are asking for a full refund!
costa-brava
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Post by costa-brava »

There is another factor that you need to check out that affects the economics of the situation. I am fairly sure that the UK and its residents are now totally out of the EEC for tax purposes in 2020. So the tax you pay on your earnings goes up from 19.5% to 24%. Also I think you cannot claim any costs of utilities etc. You have to declare and pay taxes on the full rental price.
Also, if you have cancelled bookings, you will obviously have more weeks where the property is empty and so will have to pay tax on the Spanish "perceived capital gains" that they call "renta imputada". As a very rough rule of thumb this equates to earnings of approx. 1% of the value of your house with 24% tax. This is then proportionate to the time it is not rented. It's madness but you only pay this tax for the time you are not getting earnings from the rentals.
So I believe there is a lot of virtue for UK owners in Spain in holding guests to insurance cover wherever possible.
Sunbeam
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Post by Sunbeam »

Costa-brava: thanks for reply - good point for those resident in UK with Spanish homes.

On reflection I should probably have posted this in the Spain section.
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CSE
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Post by CSE »

Up date
https://news.sky.com/story/coronavirus- ... n-11956983

If you do give a refund part or whole it could hold you in good stead when this blows over. Those prospective guests may return later or tell friends or relatives just how sympathetic you are.
Never try to out-stubborn your guests.
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Bassman
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Post by Bassman »

CSE wrote:Up date
https://news.sky.com/story/coronavirus- ... n-11956983

If you do give a refund part or whole it could hold you in good stead when this blows over. Those prospective guests may return later or tell friends or relatives just how sympathetic you are.
If your still in business!
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CSE
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Post by CSE »

Keeping the money will not help either.
Never try to out-stubborn your guests.
Sunbeam
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Post by Sunbeam »

To put it in perspective - the cost to each guest is a small percentage of their annual income. For us it is our whole annual income if everyone wants a refund or a holiday deferred to next year.

Can a guest imagine what it would be like to wake up one morning and be told they wouldn't be paid for the year.

Perhaps it is the insurance industry who should be "flexible" on what constitutes a reasonable cancellation. Lockdown in Spain so no bars, restaurants or sights to see, not allowed unnecessary journeys - but no actual air travel ban....but the holiday is in effect ruined.
Gazpacho
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Post by Gazpacho »

Unfortunately, most of our bookings are from HA, so I'm assuming that guests will cancel before the 2-month cut off time for cancellation (we have a strict cancellation policy). For those who don't, I have no intention of giving refunds. We have, as usual, incurred considerable costs over the winter and spring in preparation for these bookings (maintenance, redecoration, replacement of items etc) and I will point this out if people ask for refunds.

This is our only income and we are facing a very difficult year. It's possible that HA and AB think that owners are all rich people renting out their homes for a little extra income that they can well do without. This is very far from the truth.
hydroland2
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Post by hydroland2 »

Gazpacho wrote:Unfortunately, most of our bookings are from HA, so I'm assuming that guests will cancel before the 2-month cut off time for cancellation (we have a strict cancellation policy). For those who don't, I have no intention of giving refunds. We have, as usual, incurred considerable costs over the winter and spring in preparation for these bookings (maintenance, redecoration, replacement of items etc) and I will point this out if people ask for refunds.

This is our only income and we are facing a very difficult year. It's possible that HA and AB think that owners are all rich people renting out their homes for a little extra income that they can well do without. This is very far from the truth.
Exactly. I certainly don't want to be hard on my guests, but as it stands my guests at least have the funds to afford a holiday. I don't. I'm pretty disgusted with HA's attitude to property owners over this.
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CSE
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Post by CSE »

There not going to be guests in Spain or Italy* for a while. Some counties either have banned travel to or recommend not travelling to Spain.
Once in Spain there now travel restrictions. So no using the car to visit the closed bars, restaurants, beaches, tourist events or sights. :shock:
Some food items are running low. Queues are forming at the shops that are allowed to remain open.
Plus folks are feeling uneasy and do not wish to travel. This may well continue after this event has ended. There is a hit economically for more then just your business. Maybe you will find the local amenities not operating in the near future or maybe closed permanently. That is because they cannot take a hit like this.
Airlines may go bust or cut back on routes.
Folks who have work now may not do soon, that will also hit the market place.

The impact of this is not gong to be over after a short time period. Best have a some sort of plan yourself.

* It is possible that other counties to maybe follow with a lock down too. :(
Never try to out-stubborn your guests.
Sunbeam
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Post by Sunbeam »

That is a very relevant point that will help guests understand our predicament Gazpacho.

It is good to see that there is a consensus to apply the strict cancellation policy - even though it is difficult to do.

With regard to worrying about garnering good will from guests and their friends and family, by offering money back – we rarely get repeat guests or recommendations - we attract adventurous guests who normally go somewhere different each year. So this is not a concern for us.

(15 March 2020) The UK has issued a travel advisory against travel to Spain which is good news for our guests due next week - they can claim costs back on their insurance.
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