Given the price of property and rents in Luxembourg, more and more people are opting for a more economical solution: shared accommodation. Indeed, if you want to rent on your own in Luxembourg today, the average rent is €1,600 per month (1).
Shared accommodation can be defined as several people renting the same accommodation (a house or an apartment). It can be described in two different ways:
- There is one lease for each room of the house: each tenant has his/her own private space and they only share the common areas such as the living room, the kitchen and the bathroom.
- There is one joint lease for all the co-tenants, and they are all named on the one and only lease. In this case, the co-tenants do not have a private room provided in the lease and it is up to them to arrange how the rooms are shared out between them. The same applies to the rent, which in this case is shared, and it is up to the co-tenants to divide it between themselves. This is still the most commonly used method in Luxembourg today.
Because of increased prices, shared accommodations are no longer popular just amongst students. It is also increasingly popular with young working people and with people living alone who want human contact, and lower rent and utilities.
(1) https://data.public.lu/en/datasets/loyers-annonces-des-logements-a-luxembourg-ville-par-quartier/
As an owner or tenant, it is important nowadays to protect your home against the various possible risks, such as theft or fire. Although in Luxembourg home insurance is not compulsory for tenants, it is still recommended to take out an insurance, for your own peace of mind. Indeed, when you live in shared accommodation and damage occurs, each person may be held responsible for the loss. This is particularly true if there is a joint and a solidarity clause between the co-tenants. For this reason, it is advisable to insure yourself against any losses which may occur in your home.
There is currently no legal framework for shared accommodation. However, as a co-tenant, insuring your accommodation does at least enable you to cover your room, the communal rooms shared with all the co-tenants, as well as your personal belongings.
What differences are there between traditional home insurance and home insurance for shared accommodation?
Strictly speaking, there is no home insurance policy for shared accommodation, but there are several solutions.
In general, insurers offer ‘shared home’ insurance, where the co-tenants share the cost of the insurance between them, and each room is insured under the same policy. The home insurance policy therefore contains all the names of the different tenants and will cover the entire surface area of the rented apartment or house.
This home insurance provides all the protection which a standard home insurance policy - such as Home - can offer. However, the difference lies in the fact that the insurer specifies, in a clause, that the contents of the accommodation are insured in accordance with ownership. This means that each tenants’ personal belongings are insured separately in the policy.
It is also possible for each co-tenant to take out home insurance individually. However, in the event of a claim where the co-tenants are not insured with the same company, settlement of the claim may be more complicated.
Finally, the landlord may take out rental risk insurance, the cost of which will be reflected in the utilities.
Each co-tenant must also take out separate legal liability insurance.
If home insurance for rental risks is not included in the utilities, the best approach is to take out home insurance with the same insurer in order to facilitate settlement in the event of claims, and to avoid disputes with the other co-tenants.