Millions of young people are turning to roommate agreements to afford property costs. Living with a roommate often proves financially secure. However, it does have its drawbacks. If you don't plan for this unique scenario, there's a chance that all parties on the deal might lose out. What, therefore, can you do to put security first when starting to live with roommates?
Getting a roommate will involve planning. You both will occupy the same space, and you must respect it. So, it is up to you to set a few ground rules and do your homework before simply rooming with just anyone. At the top of your to-do list should be a note to require the roommate to carry renters insurance.
Why a roommate needs renters insurance
In most roommate agreements, the parties who share the home will also share some of the costs. They might split rent and utility bills and share upkeep responsibilities. They could also share possessions. Thus, all roommates have a financial investment in the home. They all therefore need insurance that reflects their status as renters or owners.
If you will invite a roommate into your space, consider their personal risks. This person will have their own belongings. They will also bring specific liability risks into the house. In most cases, renters insurance will help them protect themselves. It can usually contain:
Often, you or the property owner should require the roommate to carry coverage. That will guarantee that they have protection as soon as they move into the home.
- Possessions insurance to cover the roommate's own belongings in the home.
- Liability coverage to insure the roommate's risks of causing harm to other people. If the roommate causes property damage or injuries to others, this coverage can help.
Your Own Insurance Responsibilities
Once you decide to get a roommate, you'll often have to take a look at your own dwelling insurance. The type of and the changes you need in coverage will depend on your specific ownership status.
If you own a home, and begin to rent to a roommate, speak to your homeowners insurance agent. Often, your policy won't automatically extend to any of the risks applying to the roommate. So, if your roommate triggers the need to file a claim, you might find that you have no help. Even so, you often still have recourse through other mechanisms.
- Sometimes, you can add a roommate to your existing homeowner's policy. Keep in mind, however, that this might trigger an increase in your policy limits and premiums.
- Your insurance provider might need you to require the renter to get renter's insurance. Again, this is to extend a personal degree of coverage to the individual.
If you rent the property from a landlord yourself, you'll likely have to carry your own renter's insurance. Still, both renter and roommates will likely appear on a lease. Therefore, both need their own protection. In most cases, separate renters should not try to insure each other on the same policy. The only exceptions might be in the cases of spouses or partners who become roommates.
So, before starting a new roommate agreement, contact your insurer. Ask them what steps you need to take to adjust your policy to still cover you. Sometimes, you'll need to take no action. Yet, it is never worth losing coverage by neglecting to check with your insurer.
Vetting and Preparing for a Roommate
At times, your new roommate might be a close friend or an acquaintance. Other times, it might be a stranger who moves in. Regardless, living with someone means an entirely new relationship. You must do everything to make sure you both take responsibility in the property. Therefore, vetting your new roommate will prove critical.
- Ensure the new roommate carries renters insurance. Provide this proof to the landlord.
- Both parties should sign and acknowledge a lease. The lease should state the renter's move-in and move-out dates and rent due. It should also list any upkeep responsibilities.
- Verify the roommate's social schedule. They might have a relationship, or a group of friends who will visit frequently. You need to establish ground rules for proper conduct in the home.
- Check to see if this person has a pet. Pets bring extra liabilities. Therefore, insurance policies might need updating should a pet move in.
- You can often perform background checks on the new roommate. This might enlighten you to qualities that might not make for a good living agreement. Still, if you intend to perform a check, you must obtain the roommate's permission.
Of course, do not forget that you have your own responsibilities, too. Talk to your roommate. Learn more about how you will share responsibilities. Figure out what practices you might need to adjust to be more comfortable with one another. The more you can compromise, the more comfortable life might prove.
We've got you covered. Peachstate Insurance can help you get a renters insurance policy to cover your personal belongings. Contact us for a fast, free quote right now.