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What is a breakage deposit?

A breakage deposit, also known as a security deposit or damage deposit, is a sum of money paid by a guest in advance of their stay in a vacation rental, hotel or other types of accommodation. This deposit is a form of insurance that covers any damages, losses, or extra cleaning costs incurred during the guest’s stay, such as broken or missing items, stains on the carpet, or excessive dirt or dust.

The deposit amount can vary depending on the accommodation and the length of stay but typically ranges from a few hundred to a few thousand dollars. If no damages or extra cleaning are required, the deposit is usually refunded to the guest after their stay. However, in case of damages, the deposit will be used to cover the cost of repairs or replacements.

A breakage deposit acts as a way for the property or company to protect themselves against any damages or losses caused by the guest during their stay. It also encourages guests to take good care of the property and to leave it in the same condition as when they arrived.

While some property management companies or hotels use a Damage Waiver instead of a Breakage deposit, which is a non-refundable fee that can be added to the total cost of the stay, the purpose of this fee is to cover any damages or additional cleaning costs that may occur during the guest’s stay.

It’s important for guests to fully understand the terms and conditions of the breakage deposit or damage waiver, including the amount and conditions under which it will be refunded or retained before they book their stay.

💡 Looking to implement a damage deposit for your vacation rental or hotel? Download our house rules template here to get started on protecting your property.