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Determining the Right Insurance for College Students

Insurance for College Students

As a parent, you will do anything it takes to protect your family from harm. When your child heads out the door for college, it’s a significant change for everyone – and may bring Mom and Dad an entirely new set of worries or concerns. While you can’t wrap him or her in a plastic bubble and prevent any bad thing from ever happening to them, you can put a plan in place to lessen the impact of unforeseen mishaps with the right mix of insurance for college students.

The changes your family is going through might translate into adding or adjusting the insurance coverages you’re carrying for your child once they enter college. A few key considerations are their Auto and Property Insurance, which may be covered under your Homeowners Insurance as away-from-home coverage, or through Renters Insurance. You may also be wondering about any age restrictions, and when you need to take your young adult child off of your family’s protection plan.

The key takeaways about insurance for college students that will be discussed below include:

  • If your child is taking their car to college, you will need to update their Auto Insurance to reflect their new commute and/or residence.
  • If your child is not taking their car on-campus, you should ask about an “away at college” discount, but refrain from canceling their coverage altogether.
  • If your student is living in an on-campus dorm, their belongings would be covered by your Homeowners Insurance if it includes away-from-home protection.
  • If your student is living off-campus, they will need Renters Insurance for their belongings, and may already be required by their landlord to carry it.
  • Your child will not be forced off of your family’s Auto or Property Insurance at any particular age, but several factors influence when it is appropriate or necessary for them to do so.

Car Insurance for College Students

When it comes to car insurance, the first question is whether or not your student will be taking their car to college. There are plenty of arguments for or against, that largely depend on their ability to get around and the cost of doing so. If your child is going to school in a large metropolitan area with a robust public transportation system, bringing their own vehicle probably isn’t as necessary as it would be for a student in a rural or small college town.

  • If your child is taking their car to college, you’ll first need to consider state regulations for their new state of residence. Each state sets their own requirements about what coverage may be required, and the minimum amount of protection required. When you are making these updates with your insurance broker, pricing may also change based on the location of your student’s new home and length of their commute. In general, densely-populated urban areas may be riskier for car accidents (and thus, more expensive to insure) than smaller towns.
  • If your child is not taking their car on-campus, it may be tempting to drop their auto coverage altogether – but there are several reasons why that isn’t always a good idea. First, keeping continuous coverage helps keep their rates down, because they build a history of “insurability” and claim-free driving. Second, it’s likely that your student will drive their vehicle at some point during the six-month policy period, such as during fall, spring or holiday breaks at home. Third, some carriers offer an “away-at-school” discount to help you make up the difference for less time your student is spending behind the wheel.

In both scenarios, your child may also be eligible for a “good student” discount on their Auto Insurance. Even better news for parents!

Property Insurance for Dorms and College Apartments

Dorm life in itself is a quintessential college experience. Sharing a room with a roommate for potentially the first time, living on a floor with new people and fitting all of your belongings under a lofted extra-long twin bed is all part of the grandeur. While your student is busy wondering how they can pack everything in one vehicle, you can focus on protecting their belongings with the right mix of insurance.

  • If your student is living in an on-campus dorm, their belongings would likely be protected under your Homeowners Insurance If you haven’t looked at your policy since you first purchased your home, now may be a good time to do a home inventory to make sure you have adequate coverage to replace all of your belongings, in a worst-case scenario. It is also advised to discuss with your insurance broker any away-from-home restrictions or exclusions on your policy that could impact the amount your student would be able to recover for any damages. If, for example, you were carrying a $150,000 policy that capped away-from-home reimbursements to 10% of the total coverage, the maximum amount your student could recover would be $15,000 – which may or may not be adequate to replace all of their belongings.
  • If your student is living in an off-campus apartment, you should consider Renters Insurance, if they aren’t already required to carry it as a stipulation in their landlord’s lease agreement. While your child’s landlord will have property insurance to protect the physical structure of the building, this will not include any type of coverage for the contents inside of the building. Because of this shared liability, Renters Insurance is more affordable than Homeowners Insurance.

For both Homeowners and Renters Insurance, ask your insurance broker to help you identify any exclusions or restrictions on high-value items, such as laptop computers or expensive jewelry, which may require supplemental coverage.

Is It Time for Your Child to Get Their Own Insurance Policy?

As student loan debt continues to soar and recent graduates navigate the world of entry-level salaries, parents of college students and recent graduates oftentimes find themselves helping to pay for their child’s living expenses – and maybe even feeling obligated to do so. Your child is advancing into their twenties, and you may be wondering: Should I drop them from my family insurance plan, or will I be forced to when they hit a certain age? The simple answer is that there is no simple answer.

Where Auto Insurance is concerned, you could realistically keep your child on your family plan for as long as you would like. Doing so may have some cost benefits, like a multi-driver discount. If you and your child are happy with your payment, you may want to consider asking your child to take over the expense. Talk to your Insurance Broker to see if your child can be invoiced directly, or discuss a payment plan where your child will reimburse you for making the payment on their behalf. When the process becomes too complicated or frustrating to keep up with, it’s probably time for your child to consider taking on an individual Auto Insurance policy.

With Property Insurance, the lines are a little more clear-cut. If your child is living in an on-campus dorm, or any other residence where they are not considered a rent-paying tenant (such as living with a relative) AND their belongings could adequately be covered by your Homeowners Insurance policy’s away-from-home exclusions, it probably isn’t necessary to make any changes. If they move back to your home after school and bring a bunch of expensive new gadgets and clothes, you may want to readjust your home inventory to ensure you are carrying enough protection for everyone. As soon as your child becomes a rent-paying tenant, whether that’s during college or afterward, they need their own Renters Insurance policy – and the same goes for buying their own Homeowners Insurance when they become a homeowner.

Finding the Right Insurance for College Students

Having a plan in place to protect your finances when you are starting to make tuition payments, or preparing to make student loan payments, is critically important. Give yourself the peace of mind, and help your college student start off on the right foot. And don’t forget to have a conversation with your child about the importance of continuing insurance as they transition to becoming a financially independent, bill-paying adult.

At Webb Insurance, our brokers are happy to provide price comparisons to help you make an informed decision about the coverage needed for your family. Contact us today discuss your family’s changing needs. We will help you find the mix of coverage to build your student’s safety net.