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How to Get Renters Insurance When You Have a Roommate
Does my renters insurance cover my roommate?
In most cases, no. Unless you manually add an individual to your policy, renters insurance only applies to you (and your belongings). Any damage sustained to your property, or loss due to theft, only covers those named on the policy. If you have to temporarily relocate while your apartment is being fixed, you’re the only one who can be reimbursed with additional living expenses.
[ Next: What Does Renters Insurance Cover? ]
Can I share my renters insurance with my roommate?
Some policies allow you to add on a roommate to your policy, but it’s generally not recommended for many reasons. In most cases, it’s better to each have your separate policy. If you want to add a roommate, you must both be on the lease to qualify. You can’t add a friend or family member who is temporarily staying with you or subletting a room.
Also, check the terms of your lease agreement. In most cases, the renters insurance clause requires everyone on the list to have coverage. While you can determine whether that means separate or shared policies, it does underscore the importance of explicitly listing each roommate on a shared policy. Otherwise, you run the risk of not being covered during an event and breaking your lease agreement, all at the same time.
What should I know before sharing my renters insurance policy?
There are several reasons why it’s more beneficial to have your policy instead of sharing with a roommate. First of all, filing a claim is easier because you know exactly where you are in the process, rather than relying on a roommate’s timeline. Having your renters insurance policy ensures you get the entire coverage limit for each category applied to your belongings. For example, if there is a fire and your policy only covers $1,500 in electronics, you can apply that full amount to your things, like your laptop, television and stereo. The same holds true for additional living expenses if you ever need to vacate the property temporarily.
[ More: Does Renters Insurance Cover My Pet? ]
In addition to your actual coverage, sharing renters insurance can impact your financials in other ways. Your credit score impacts the amount you pay for a premium. If your roommate has a significantly lower credit score, sharing a policy may not save you money at all. Any claims filed by your roommate will remain on your insurance claims history for up to seven years. Anytime you apply for any other type of insurance, you could end up paying for more if you have too many claims in your history (even if your roommate filed a report without you).
Questions to ask your roommate before sharing a policy
Talking to your roommate about sharing a policy can be tough. Here are some conversation starters to make the best decision for both of you.
- How is your credit score? If your scores are vastly different, one of you may save more money rather than sharing.
- Who is going to apply? One person will need to be in charge of submitting a shared policy application.
- Once a plan is chosen, how do we add the other roommate to the policy? Accidents can happen anytime, so the primary policyholder must add the roommate right away.
- How long do you plan on living here? If this is a short-term living arrangement, you may not want to bother sharing a policy since one roommate may move out shortly.
These questions can help open the door to talking about sharing a renters insurance policy and explaining why separate policies are probably worth it.
Pros and cons of sharing renters insurance with a roommate
|May save on premium.|
Only have to submit one application.
|Could meet coverage limits more quickly.|
Claims history follows you for five to seven years.
Is renters insurance cheaper if I share it with my roommate?
Finding the cheapest renters insurance is important to many people, especially with high rents and an unstable economy. The Simple Dollar is committed to guiding you on living a frugal life and reaching financial stability.
Even if you split a renters insurance policy with your roommate, you may not save money in the long run. Look at it this way. The average renters insurance policy is about $180 a year — or $15 per month. By splitting the policy with your roommate, you could save $90 a year, paying only about $7.50 a month. That’s not a huge difference in your monthly budget. Now think what would happen if a major event does occur, and you actually have to use your policy to buy new things. You have to split the coverage limits with your roommate, which means you could have thousands of dollars less to work with.
Is sharing my renters insurance with my roommate worth it?
You may end up saving a few dollars each month by sharing renters insurance with your roommate, but it’s not worth the risk. You’ll limit the amount of reimbursement money you receive, regardless of the value of your belongings compared to your roommate. If you’re considering renters insurance for college students, remember that students living in a dorm are typically covered by their parents’ insurance policies. The only time college students renters insurance is required is if you’re living off-campus.
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