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Explained: The difference between Additional Interest and Named Insured, and what you need to know.

Explained: The difference between Additional Interest and Named Insured, and what you need to know.

Insurance industry terms can be confusing. It also doesn’t help when the words are so similar.

Don’t take it personally. Even landlords can confuse the terms and end up asking their tenants for the wrong information.

Leading our support team, I see various types of questions and confusion around insurance, and it's our duty to help bring clarity. Among the most common mixups we come across are members asking to include their landlord or property management company in their policy as a named insured.

But in reality, they should be added as an additional interest.

When considering renters insurance, additional interest and named insured are two terms you want to understand as a knowledgeable insurance consumer. And mistaking these terms can cause significant headaches, from delays in setting up your insurance coverage to costly legal expenses.We’ll go over everything you need to know so you can set up your insurance smoothly and fully understand what your landlord requires.

  • Renters Insurance Additional Interest and Named Insured
  • Why It’s Important To Get the Terms Right
  • How To Set Up Additional Interest and Named Insured on Goodcover
  • Final Thoughts: Renters Insurance Additional Interest vs. Named Insured

Renters Insurance Additional Interest and Named Insured

These terms are frequently misused because they’re called by different names that sound similar. So what is additional interest on renters insurance? What is named insured? Let’s take a look.

Additional Interest

When you list someone as an additional interest, that person is notified of the status of your renters insurance policy. That means they can check the policy and insured status and get notified if your policy lapses or if you cancel it. However, an additional interest can’t change the policy — only the first-named insured (that’s you!) can do that.

Additional interest is also sometimes called “interested party” or “additional interested party,” but these names all mean the same thing. Many landlords want to be listed as an additional interest so they can see what your liability limits are and confirm you have an active insurance policy while you rent from them.

Landlords usually aren’t as worried about your personal property coverage. They usually only want to ensure that if you cause property damage, your insurer and policy will cover it. 

By being listed as your renters insurance additional interest, your landlord can see your insurance contract to make sure it meets the lease policy minimum requirements. Goodcover’s policies start with $100,000 in liability coverage, which satisfies most landlord’s requirements.

Now, let’s say a landlord requires standard renters insurance, but as soon as a tenant moves in, they cancel it. If a landlord isn’t listed as an interested party, they won’t know of the change. If something happens to the property, they have a problem.

That's the reason why they want to be notified about your policy.

Named Insured

A named insured on your insurance policy is a person that’s “named” in your policy. If you add a person as a named insured, they are covered by the policy, but they can also file claims and view coverage at any time. The only thing they can’t do is make changes to your policy – only the first-named insured can do that.

Named insured can also be referred to as an additional insured or additional party. It’s also known as second-named insured, as you are the first-named insured on the policy.

You might want to name your spouse, partner, roommate, or family member who lives with you as a named insured (even though they’re insured on your policy just by virtue of being on the lease).

If you want the other person to have the ability to file claims, having multiple named insureds might be useful.

Sometimes landlords or property managers will request to be named insured. However, most of the time, landlords actually mean additional interest instead of named insured.

As we’ve established, the terms seem similar, so it’s easy to mix them up. We don’t allow landlords to be named as an additional named insured,  because it could cause significant problems. Here’s why it’s not a good idea.

Why It’s Important To Get the Terms Right

Remember, these terms accomplish different goals.

Listing your landlord as an additional interest in your renters insurance lets your landlord know the status of your policy. They’ll be notified if your policy is active, lapsed, or canceled. And while all people on your lease are automatically covered on your policy, adding a second named insured gives the person the ability to file claims.

Adding your landlord or property manager as a named insured isn’t a good idea (and we don’t allow it on Goodcover). Just picture these two scenarios:

  • You name your landlord named insured, and they file an insurance inquiry for their property under your policy.
  • If you name another party as named insured and end up in a legal battle, the insurance company would have to represent both insured parties, which would be a clear conflict of interest.

Neither of these scenarios seems appealing. We’re in the business of saving you money, and that includes saving you a mountain of legal defense costs suing someone who shouldn’t have been a named insured in the first place.

If your landlord wants to be named on your policy, check to see if they mean additional interest. Chances are they’ll tell you they just want proof that you remain insured while a tenant.

How To Set Up an Additional Interest on Goodcover

Setting up renters insurance additional interest is easy on your Goodcover dashboard.

To give your landlord additional interest status, you only need the landlord or company name and email. If you don’t have an email, you can enter the physical address, and we can send them a copy of the additional interest endorsement.

Screen showing how to add your landlord or property to your policy with Goodcover.

How To Set Up a Named Insured on Goodcover

Adding a named insured to your Goodcover policy is a straightforward process. 

Although Goodcover automatically covers your roommates, partners, or family members as long as they’re on the lease, we allow you to add them as a second named insured if you or your landlord requires it (at no cost).

You can add this information during your initial quote, so it’s bound to your policy from the start. If your circumstances change, you can add or remove contacts from your Member Dashboard anytime.

Final Thoughts: Renters Insurance Additional Interest vs. Named Insured

Now that you know what renters insurance additional interest and named insured mean, you can feel confident when setting up your insurance policy.

In the end, landlords want to make sure their tenants have renters and liability insurance so they’re covered if something terrible happens.

That’s why you have an insurance company.

At Goodcover, we make insurance easy and transparent so you feel good about your coverage. Switch to modern renters insurance by getting a Goodcover quote today.


Note: This post is for informational purposes; insurance regulation and coverage specifics vary by location and person. Check your policy for exact coverage information.

For additional questions, reach out to us – we’re happy to help.

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