If you have a child living away at college, youve probably been through an extensive checklist in getting him or her prepared and moved to campus for the fall semester. Amid the flurry of planning and packing, have you thought about college and insurance? Although still your dependent, your child living away from home may have additional insurance needs to protect their belongings and their well-being. Consider these areas:
Fewer than half of college students have cars on campus, so if your child doesnt have wheels, let your carrier know. Your student may be eligible for a distant driver discount, especially if the college is more than 100 miles from home. The discount may be as high as 20 percent. Keep your child on your auto insurance policy so coverage continues during school breaks and visits home.
If your child does have a car on campus, report this to your insurance carrier. Some insurers may change the price of coverage – lower or higher – based on the schools location.
Many auto insurance companies reward students for excelling at college. Good student discounts are common for maintaining at least a B average. Discounts average 10 percent, but may be as high as 20 percent.
While youre asking your carrier for the good student rate, ask about other discounts, such as taking an online driver safety program or signing a safe driver contract. Some insurers offer discounts for installing electronic programs called telematics. These electronic devices plug into the bottom of the steering column to transmit data to the insurance carrier about speed, time-of-day driving, etc., in order to promote safe driving.
If you are co-signing at a lending institution for a student loan, a term life insurance policy for your college student will protect you against a worst case scenario – the death of your son or daughter before the loan is paid in full. Many carriers offer low rates for such policies.
A plan with up to $250,000 in coverage, for example, can cost as little as $15 per month for a healthy college student or a recent graduate. The policy you purchase should be equal to the loan balance and the term equal to the estimated repayment of the loan, usually 10 to 20 years but locking in a 30 year term life insurance plan now when your college student is young and in good health, is a sound financial strategy..
Dorm Insurance or Renters Insurance
The heap of electronics, furniture, household goods, clothing, accessories and other stuff that students haul to their campus home adds up to big dollars. Be sure to take proper steps to protect their items against loss or damage.
Your homeowners policy will probably cover your college students belongings while living in an on-campus residence. Coverage usually is only 10 percent of the limit on the contents of your home, however. So if your policy covers up to $50,000 in losses, coverage for your college student may cap at $5,000, which may not be enough in the event of a massive loss.
A dorm insurance policy may be an option if your student is living in approved housing. Deductibles may be just $25, with rates as low as $140 per year. Again, the coverage may cap at $5,000, so if your student has many electronics and other pricey possessions, you may need other coverage, such as a homeowners policy floater or endorsement to cover high-value items.
If your student is living off-campus in an apartment or other rental, youll need a separate renters insurance policy. Insurance rates vary depending on the state and the amount of coverage needed.
Dependents can be covered up to age 26 under provisions of the Affordable Care Act (ACA), whether single or married. Youll need to check if your health plan provider network includes doctors and hospitals in the area of your childs college. With a Preferred Provider Network, youll pay a larger portion of medical bills out of network; with a Health Maintenance Organization, your child may have no coverage outside the network, except for emergencies.
The college may offer a student health plan with comprehensive coverage. Be sure to understand any limitations. The ACA is another option if the college town is outside your provider network. Time to purchase begins when the student starts school. Annual enrollment for 2018 runs from Nov. 1 to Dec. 15, 2017.
Taking inventory and appropriate steps now to protect your college student will ensure that you dont run into unexpected situations and will help you more fully enjoy the college years as a family.
September is Life Insurance Awareness Month (#LIAM17). Our licensed agents are available to provide you with a free quote or any information you need as you evaluate the best life insurance options for you and your family.
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