Additional Insured vs Additional Interest: Understanding Your Policy

Additional Insured vs. Additional Interest: Understanding Your Policy

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Additional Insured vs. Additional Interest Explained

Additional insured and additional interest are two very different roles that a person can play as a part of your insurance policy. In short, an additional insured is covered by your insurance, while an additional interest is not. However, when you make policy updates, the insurance carrier will still inform the additional interest. 

With this in mind, keeping these similar-sounding insurance terms straight is very important! Let’s take a deeper dive into what they mean and how to use them.

What Is An Additional Insured?

An additional insured is someone who gets coverage from your insurance policy. Their name isn’t on the policy, and they typically aren’t responsible for paying the premium. However, they do still enjoy the benefits of your policy.

Additional Insured On Your Home Insurance

When it comes to home insurance, the additional insured is often a household member. A great example of this would be a retired senior living with their son and daughter-in-law. As a household member who is covered by the home insurance policy, that retiree is an additional insured.

Additional Insured On Your Auto Insurance

Auto insurance is similar! If your sister often borrows your car and you’d like her to get liability coverage through your auto policy, she would be added as an additional insured.

Additional Insured vs. Additional Interest
Which One Will Impact My Premium?

increasing cost

An additional interest on your insurance policy will not impact your premium! An additional insured will increase your premium slightly.

What Is An Additional Interest?

An additional interest is someone who has a financial interest in the property that you’re covering with your insurance policy. In other words, they’ve got skin in the game! They don’t get policy coverage, but they will get updates when you make any changes or updates to it.

Additional Interest On Your Home Insurance

With home insurance, this usually comes into play with landlords and renters. For example, if you’re renting a home, the landlord may ask for you to list them as an additional interest on your policy. This helps them confirm that you stay insured without giving them the power to adjust your policy or get claim payouts.

Additional Interest On Your Auto Insurance

For an auto insurance policy, having an additional interest is less common. For example, if you drive a company car, the company may ask for you to list them as an additional interest on your auto policy. This could also apply to a co-owner who doesn’t actually drive the car. When it comes down to it, the goal is to keep everyone in the loop who has financial interest in the vehicle.

If You’re Ever Confused, Talk to an Expert

Insurance can be a giant headache. TGS Insurance is here to help! Our expert agents know the right questions to ask to find you the answers you need about your insurance policies. If you would like to learn more about your home or auto insurance, or if you want to make sure that you’re getting the best deal possible on your insurance, chat with an agent today!