Processes in Microsoft 365 for setting up Office apps, redeeming product keys, and activating licenses.
Hi Lesley, No, that is not how it works. You can install Office on all of your devices. See: How sign in works in Microsoft 365 - Microsoft Support You will be able to see and work on your files on all of the Devices.
You share your Microsoft 365 Family with up to 5 other people. See: Share your Microsoft 365 Family subscription - Microsoft Support
They can also install Office on all of there devices.
But none of the other member or you can see or work on other peoples files. Please come back for any clarification. It will make sense when you get the idea.
PS: other members use their own Microsoft Account to install Office when you send them a share. So, nobody has access to other peoples Office.