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Who’s Liable When an Airbnb Stay or Uber Ride Ends Badly?

November 10, 2015, 9:46 PM UTC
Photograph by Getty Images

Upstart companies like Airbnb and Uber face a number of challenges as they take on incumbent businesses. One issue that is already complicating their huge ambitions is ensuring customer safety —and the question of who is responsible when things go wrong.

Over the weekend, journalist Zak Stone wrote a harrowing account of his family’s vacation at a house in Texas booked through Airbnb that ended with his father’s death while on a rope swing on the property. The tree branch used for the swing broke off and fell on his head.

Stone’s story—and tragic loss—is a stark reminder that under these companies’ shiny mobile apps lie fundamental dangers. The companies insist they are not responsible, for the most part, while their customers are usually unaware of the legal nuances involved.

This isn’t the first time an Airbnb booking has had a bad ending. In 2011, a host’s home was completely trashed and burglarized by her Airbnb guests while she was away. Although the company denied responsibility at first, invoking its status as simply an online marketplace, it eventually reversed course.

Airbnb offered to pay for the damages and instituted a $50,000 guarantee to hosts for any losses (the coverage has since been increased to $1 million). Co-founder and CEO Brian Chesky recently told Fortune that he realized the principle of the matter was too important for the company to do nothing.

In March, an American man booked a home in Salta, Argentina, and then ended with a two-night stay in the hospital after he was attacked by the host’s dog. Airbnb only agreed to pay for his medical bills after the New York Times reached out about the case.

Meanwhile, a young Massachussetts man claims he was sexually assaulted in July by his host in Madrid after Airbnb refused to give his mother the listing’s address after he contacted her about the danger or call the police. Instead, Airbnb directed her to call the Madrid police department.

And after a woman died from a carbon monoxide leak in a Taiwan property in 2013, Airbnb instituted a program for free smoke detectors and carbon monoxide detectors for U.S. hosts. The company doesn’t inspect properties listed in its marketplace, but rather offers safety recommendations on its website.

MORE: Protesters occupy Airbnb HQ on eve of San Francisco vote

This year alone, Airbnb told Fortune that customers have submitted 50 injury claims in the U.S., although it declined to comment about their nature. An Airbnb spokesperson said:

“We were shocked and heartbroken when we learned about these incidents and we continue to keep these guests and their families in our thoughts. Nothing is more important to us than safety. Over 60 million guests have stayed in an Airbnb and we are proud that accidents are incredibly rare. We know that every industry, every community, and every city grapples with safety issues and no one has an absolutely perfect record, but that’s what we strive for and we’ll keep working as hard as we know how to make our community safer for everyone.”

Uber has also faced its fair share of cases of involving liability. On New Year’s Eve in 2013, an UberX driver in San Francisco hit and killed an eight-year-old girl crossing the street with her family while waiting for a new fare. Uber, which also maintains that it’s simply a marketplace that connects independent drivers and passengers, eventually settled the case with the family for an undisclosed amount.

Nevertheless, Uber and other startups have been wary of getting too involved in these cases from fear of setting legal precedents and implicitly taking responsibility. Though they’ve both had insurance policies in place for a few years now, Uber and its rival, Lyft, still face questions of liability involving accidents or drivers assaulting passengers. Critics have long accused ride-hailing companies of failing to complete thorough background checks on their drivers. Both Uber and Lyft have responded that the checks are as complete as possible.

Turo, which until last week was known as RelayRides, a marketplace that lets people rent out their cars to strangers, already had an insurance policy in place when a customer died in an accident in 2012. However, instead of passing off responsibility, it discouraged the car owner’s insurance company from covering the claim and instead let its own coverage handle it, according to the New York Times. The company wanted to avoid entangling the car owner’s insurance company and any potential impact on other customers who rented their cars through its service.

Though Turo’s responded differently from its fellow sharing economy startups, one theme is constant when things go bad. These companies are working to strike a balance between operating legally and minimizing incidents while steering clear from as much scrutiny as possible.

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(An earlier version misspelled Turo’s name. The story has been corrected.)