Renters insurance and roommates: who’s protected?

Roommates (usually) make for great company and often come with the bonus of shared home life costs. You split the rent, share the chores and binge-watch the same shows. But when it comes to renters insurance, it may be better to go it alone.

One of the most common questions we hear about renters insurance is “should my roommate and I share one renters insurance policy?” The short answer is – it’s simpler if you don’t.

Renters insurance policies will cover you, your spouse or partner and any children living with you. But friends, housemates and anyone else not related to you or your partner? They’re not covered unless you add them as an "Applicant" when you’re signing up for insurance. Even if you add your roommate as an “Applicant” there are some common challenges shared policies encounter that you may wish to consider:

Claims can get complicated and costly

Let’s say your roommate files a claim because their laptop was stolen at school while you were working across town. Even if you had nothing to do with it, their claim becomes part of your insurance history if you’re both named on the same policy. Looking ahead, your roommate’s legitimate claim could lead to higher premiums for you or, in extreme cases, make it hard for you to get insurance on your own.

Shared policies mean shared payouts

Let’s say a storm wrecked your patio furniture. If your claim is approved, the insurance payment will be made out to both you and your roommate. This means you’ll need your roommate’s approval and signature to cash the cheque and you’ll have to agree on how to split the funds. This gets tricky if:

• You’re no longer on good terms
• One of you has moved out of the house
• You own higher-value items, like all the furniture, while they only moved in with a few jeans and t-shirts.

It can also create complications when it comes to dividing the cost of the premium itself, especially if your possessions are worth significantly more than your roommate’s.

Roommates come and go

You may be best friends forever – but chances are that one of you will move out before the other. If you share insurance and your roommate moves out, you’ll need their consent to remove them from the policy. If they don’t respond to your request or they disagree, things can get messy. Worse, if you submit a claim while they're still technically part of the shared policy, they can be entitled to part of the payout even after they’ve moved out of the home.

Shared coverage limits may leave you short

Let’s say your shared renters insurance policy includes $20,000 for additional living expenses if your place becomes unlivable due to a really unfortunate event. That might sound like a lot of cash, until you realize you need to share that amount with every roommate. Ever try to book a hotel or Airbnb in peak summer season? If you can find one (fast), it will likely cost you hundreds of dollars a night. So, if you and your roommates need to stay somewhere for a few months, that $20,000 will quickly vanish.

Everyone’s stuff is different

Who owns what? If you haven’t talked about it with your roommates, now’s the time. Use our free Personal Property Calculator to make a list of everything you and your roommates’ own. This will help you realize how much insurance coverage you each will need. It will also help you avoid disputes if an insurance claim needs to be made later on. And once you’ve compiled your list, take photos and ideally keep receipts of every item you own.

A smart and simple solution is…

Each roommate should get their own renters insurance. This way, you’re only responsible for making your own claims, you only pay your own premiums, you don’t have to badger roommates to help pay the premium each month and you’re all just responsible for your own belongings. Your own policy will makes things clear and way less stressful if life sends an unwanted surprise your way.

More affordable than you think

At BCAA, we make it easy and affordable, with basic renters insurance starting at around $20/month. Plus, you’ll save 5% when you buy online and another 10% as a BCAA Member. Get a renters insurance quote online in as little as 5 minutes and make sure your coverage is built to protect you and your stuff.