College is a big step toward gaining greater independence as a young adult. With this comes the responsibility of learning how to protect your assets while creating a financially secure future for yourself. And, this step could also trigger your first experience with insurance coverage, or help you learn about different types of insurance coverage you aren’t familiar with. Before packing your bags and heading off to start your new college adventure, take a few minutes to review the following frequently asked questions (FAQs) both college students and parents ask about insurance coverage, namely auto insurance and renter’s insurance.
Do I need renter’s insurance when I go to college?
This isn’t a simple “yes” or “no” answer. It depends on a few things.
- Are you under 26 years of age, enrolled as a student, and live in on-campus housing or with your parents? If so, your parent’s homeowners insurance will likely cover your personal property, such as a computer, television, bicycle, and furniture, if it is damaged, destroyed, or stolen. You’ll likely not need a separate renter’s policy.
- Check with your parent’s homeowner’s insurance agent or insurance company to make sure, though, because aspects of their policy may be different than a general policy. For instance, sometimes the personal property coverage is reduced to 10% of the contents coverage limit if personal property is off-premises (meaning you wouldn’t be reimbursed the full amount of your policy limit if the property was kept off site at a dorm).
- Will you be living in off-campus housing, such as an apartment or condo? If so, you’ll need your own renter’s insurance policy to cover your personal property and liability exposures. Your landlord’s insurance will not cover these…neither will mom’s or dad’s.
Can I stay on my parent’s car insurance policy when I go to college?
As you’ll quickly learn, as with most insurance-related questions…there are few “yes” and “no” answers…it usually “depends.” In this case, it depends on many variables, such as whether you’ll be taking a car to school? Will you be driving the car while at school? Will you be driving a friend’s car while at school? Will you be going home on the weekends/holidays and driving a car during that time? Will you be a passenger in a car while enrolled in school? These questions are prime examples of how helpful an independent insurance agent can be to you and your family. Your local agent is an expert in insurance! Rely on their advice and you won’t go wrong.
When deciding whether or not to stay on your parent’s auto insurance policy, most experts agree that it’s probably best to keep young adults, such as most college students, on the policy. This is especially true if you, the student, plan to take a car to school, or if you’ll be commuting to school or going home on the weekends and holidays and will likely drive a car during that time. This provides a safety net in case you need to drive a friend’s car while at school, such as in the case of an emergency, or in the unfortunate event you are hit by a car while riding a bike, walking, or while riding as a passenger in a vehicle.
If the premium seems high due to your age, ask your parent’s agent or insurance company if there are good student discounts available or any type of distant student discount that might help lower the cost.
If you will not be taking a car to school and are certain you will never drive a car while a student, it might be worthwhile to consider removing you from your parent’s auto insurance policy. We urge you and your parents to have a sit-down discussion with your insurance agent to make sure you are considering all the facts and possible ramifications of this decision. Again, if you were to be injured by another vehicle while riding a bike, walking, or riding as a passenger in another car, you will want to make sure you are covered for any potential medical costs. Even if you and your parents ultimately decide to remove you from their auto policy, be aware that many insurance companies will not allow a licensed driver in the household to be removed from the policy once he or she has already been listed on the policy. This action would be company-specific, so be sure to check with your insurance agent.
While these FAQs may answer some or all of your questions, it is still best to review your individual insurance needs with an independent agent. Your agent will review the current coverages that apply to you and make sure you’re adequately covered. And, it’s never too early to build a relationship with a trusted insurance advisor…a relationship that will serve you well as you embark on more milestones in the coming years.