And why your landlord is having you list him as one.
When you purchase a renters insurance policy, you have the option of naming an interested party, also known as an additional interest or party of interest. An additional interest is notified about changes to your renters insurance policy, for example, if you cancel your policy or don’t renew it. Why would you name an interested party? And what is the difference between an interested party and and an additional insured?
You can add additional interest or interested party or party of interest after you purchase your renters insurance policy. You simply contact your insurance company and say that you want to add an additional interest. Some insurance companies will allow you to name an additional insured online; others will want a phone call or even a fax — it depends on your company.
When you add the additional insured, you will need to provide the name of the party and also an address so that they can receive updates about your account. Before you call, make sure you get the correct address from your landlord, property management company, or your lease. Some companies use outside agencies to monitor their insurance certificates, so the address to list on your policy may be different from the leasing office.
An additional interest that is listed on your insurance policy does not receive any insurance coverage and does not affect your premiums. The additional interest simply gets alerted if you cancel or don’t renew your policy. It doesn’t cost anything to add an interested party.
When you name an additional insured, however, you are extending the coverage of your policy to another person, like a live-in partner or a roommate. Adding an additional insured to your policy may increase your premiums.
Read more about renters insurance and roommates.
If your landlord or property management company requires that you purchase renters insurance, then it’s very likely they will also require you to list the management company as an additional interested party on your renters insurance policy. Some landlords may just require to see proof of insurance, but many will want to be listed on the policy as an additional insured so that they will get a notice if you ever cancel the policy, lower your coverage, or if you don’t renew it.
The reason your landlord wants to be listed as an interested party on your renters insurance policy is the same reason he wants you to get renters insurance in the first place: protection, both for you and for him.
There are a few explicit ways that you getting renters insurance is good for your landlord, and requiring that you name him as an additional insured or an interested party just means that he can be sure that your policy is in force and that the coverage is in place.
Reasons why landlords require renters insurance, and require being named as additional insured:
The personal property coverage of your renters insurance policy ensures that you have protection in case your belongings get destroyed — many tenants without renters insurance don’t know that their landlords aren’t liable for their personal property, and by requiring renters insurance, your landlord ensures that you know that and will have no reason to try to get him to pay. (Similarly, the additional living expenses provided by your renters insurance policy ensure that you have a place to stay if the building burns down — and that you won’t try to get the landlord to pay for your expenses).
The liability coverage of your renters insurance policy means that if you damage or destroy the building through negligence, your landlord can sue you, knowing that your renters insurance policy will pay for your legal feels and that your liability coverage would pay for the damage to the building (or at least, for his out-of-pocket deductible).
The liability and medical payments offered by your policy also protect the landlord. This coverage means that if a guest gets hurt in your apartment or gets bitten by your dog, they have recourse to go to your insurance company and won’t go after your landlord.
Policygenius can help you find the right renters insurance company and the right amount of coverage. Get a free renters insurance quote.
About the author
Logan Sachon is the co-founder of The Billfold, a groundbreaking personal finance site for millennials that was named one of Time's 25 Best Blogs of 2012. Her work has been published in New York Magazine, Glamour, The Guardian, BuzzFeed and more.
Policygenius’ editorial content is not written by an insurance agent. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for you.
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