Did you know that most homeowners policies exclude property coverage for a regular resident of a household that is not named on the policy and is not a relative of the homeowner? The policy exclusion refers to roomers, boarders, and other tenants. This would mean that the property of a live-in friend is not covered under the standard homeowners policy. Only the people named on the policy and their relatives would have coverage for their personal property, such as clothing, electronics, furniture, etc. Anything that the friend owns, brings into the relationship, or buys is not covered. The same thing is true for the friend’s children. If the house burns down or is burglarized, the claim for the contents belonging to the girlfriend or her children would not be covered. The standard homeowners policy would cover the contents belonging to the insured named on the policy and his or her relatives but would not cover contents belonging to anyone else living in the house.
Another issue is liability coverage. Most homeowners policies provide coverage for the insured for an injury or property damage. It would not cover a party that is not the person named on the policy. If the named insured was burning leaves in the yard and caught the neighbor’s shed on fire, the homeowners policy liability coverage would apply. If, however, it was the girlfriend who was burning leaves, the liability coverage would not extend to her.
If the girlfriend does not have a policy which provides property and liability coverage, she could be financially ruined. This situation can be rectified
with Pekin Insurance’s endorsement HO 04 58 Other Members of Your Household, which extends the policy coverage to the household members listed on the endorsement. This endorsement also provides liability coverage for the listed household members. Another option would be for the other person to purchase separate contents coverage, such as an HO 4 Renters Policy, which would provide coverage for the belongings in any location and liability coverage as well. A third option, if both parties have a financial interest in the house itself, is to put the policy in both names or add one as an additional insured.
It is always best to advise your agent of all parties living in the household when the policy is written or later if things change.