By Richard A. McGrath, CIC, LIA
It’s getting closer to back to school time, which means parents are busy buying their kids the essentials for college life, from bed sheets and toiletries to snacks and food for the mini fridge. However, most likely you’re forgetting about an important item to review that isn’t included on any checklist. Insurance is probably the last thing on your mind, but it definitely should be added onto your list of things to do. If you have children who are going off to college, there are three types of coverage you should consider to keep them protected while they are away: renters insurance, car insurance and health insurance.
There was an estimated 14,000 burglaries on college campuses in 2014, according to the U.S. Department of Education. On average, college students bring personal property that is worth anywhere between $5,000 and $10,000, according to The Hanover Insurance Group. With that said, it’s obvious that crime is a serious issue for college campuses. So how can you ensure the safety of your children’s personal property while they are away from home?
If your children are living in a college dorm or other type of campus housing, most of their belongings should be covered by your existing homeowners or renters insurance policy. However, it’s important that you speak with your independent agent to make sure this is the case, and to check if there are any coverage limits. Some policies might limit off-premises belongings to a certain percentage of the total amount of coverage for personal possessions. More expensive items such as laptops, jewelry and other electronic equipment may require additional protection through a stand-alone policy.
For students who are living off campus, you will need to purchase a separate renters policy to protect their belongings. A quick phone call to your agent can help you determine how much coverage is actually needed. It’s also a good idea to remind your kids to leave valuable items at home or in a local safety deposit box and to create an inventory of personal items brought to school. To download our free Home Inventory Guide, please visit http://mcgrathinsurance.com/resource-center/the-home-inventory-guide/.
Another type of coverage that goes hand-in-hand with renters insurance is identity theft protection. This will help protect your student in the event they fall victim to identify fraud or theft. The good news is that coverage is relatively inexpensive for the protection provided.
It’s important for students who have a vehicle on campus to make sure it’s properly insured. If your child will have a car while they are away at college, you should find out how this may impact your coverage. Remember, depending on where the car is parked, certain areas may be subject to higher coverage rates. Your agent can advise you on whether you will need to increase or decrease your coverage, and whether it makes sense to purchase a separate auto insurance policy for your child.
Remember not to drop your child from your auto policy, even if they won’t be using a car while away at college. Certain states like Massachusetts require continuous coverage in order to receive a preferred rating for car insurance.
If your college student is leaving their car at home and the college is located at least 100 miles from your home, then you may qualify for a discount. Additionally, if your student maintains good grades in school, they may qualify for a discount. Depending on your student’s driving record, they could receive discounts for not having any traffic violations for a certain period of time, the type of vehicle driven, and how much the vehicle is actually used. Check with your agent to determine what credits and discounts could be applied to your policy.
Currently, children can stay on their parent’s health plan until age 26 as mandated by the Affordable Care Act (ACA). However, if your college student is attending an out-of-state school, you should check with the insurance company to make sure that there are in-network providers close to campus. If there are no in-network providers, then it’s a good idea to ensure that your child has all routine preventative care visits taken care of while they are home, and make a plan for emergency situations. Be sure to remind your kids to carry a copy of their health insurance card at all times.
Another way to secure health insurance for students is to purchase coverage directly through the college itself. This is a good option for students who are 26 or older, but keep in mind that there may be limitations on claims or doctor visits.
Additionally, if you don’t have life insurance, now is the perfect time to discuss it with your independent agent. Life insurance can be used as a means to fund your child’s education in the event of your untimely passing. It can also help ensure that any significant debt you might have won’t be passed onto your family members.
You might not always be there to protect your kids while they are at college, but you can protect them from certain things with the help of insurance. Take this opportunity to teach your kids an important lesson about how insurance offers protection for the unexpected events in life, and the importance of having a trusted independent agent on your side to look out for your financial well-being.
Richard A. McGrath, CIC, LIA is President of the McGrath Insurance Agency, a division of Starkweather & Shepley Insurance, located in Sturbridge and Spencer, Mass. He can be reached at 508-347-6850 or at firstname.lastname@example.org.
This article is written for informational purposes only and should not be construed as providing legal advice.