It’s Back-to-School time! Time to go through the kids’ closets and hope that capris are the next fashion fad for growing boys; time to post all those “First Day” pictures on social media; time to groan over the college tuition bills, and time to read your Automobile and Homeowners’ policies… wait, what?
If your son or daughter is heading off to college to start their next chapter in life, your Home and Auto coverage may be the last thing on your mind. However, it’s important to know what your insurance policies say about college students living away from home.
First, let’s take a look at your Homeowners’ policy. In general, a Homeowners’ policy will provide coverage for an insureds’ Personal Property anywhere in the world. The first question you need answered is, “Is my college student living away from home still considered an ‘insured’?” On most Home policies, as long as your child’s primary residence is still your home, the child continues to be defined as an “insured” and, therefore, her personal property is insured while she is living away from home to attend college. Some Home policy forms also require the child to be a “full-time” student and under 24 years old in order for coverage to be afforded. However, unless endorsed, the policy will only cover 10% of the Coverage C (Personal Property) limit for property located anywhere other than the residence premises. If your child is living in a dorm room, 10% is probably adequate to cover her personal belongings in her room. If your child is renting an apartment, in which you own all the furnishings, you’ll want to consider endorsing your Home policy to provide more coverage, or, better-yet, obtain a Renters’ policy for that location. A Renters’ policy will also provide additional liability coverage for the rented location that you would not be able to obtain on your Home Policy.
What a relief to know that the $2,500 laptop computer you just bought her for college will be covered on your insurance, right?! Well, maybe. A standard, unendorsed, Home policy provides Named Peril coverage for Personal Property. Theft is probably one of the most likely causes of loss for a laptop and, good news, Theft is a Named Peril. (Noted: There is no Theft coverage for students away at school for the first 45-60 days, depending on your policy.) However, Accidentally-Dropped-And-Danced-On and Beverage-Poured-Over-Keyboard are not Named Perils. To obtain more comprehensive coverage for laptops and computer equipment you will need to make sure your Home policy is endorsed properly.
Now, onto the Automobile policy. You might think when your child leaves for college, without a vehicle, that you can save some premium dollars by removing her as a driver on your Automobile policy. However, in order to protect your assets and your child’s future earnings, she needs to remain on your Auto policy. Just because she did not take a vehicle to school with her, does not mean that she will not drive, or occupy, a vehicle. Keeping her on your policy provides auto liability coverage that will help protect her when she is driving a friend’s vehicle that isn’t adequately insured, or if she comes home for a weekend and wants to use your car. In addition, staying on your policy also provides her with continuous insurance coverage, which will be beneficial when the time comes for her to get her own Auto policy. Many carriers offer a distant student discount for full time students who are away at college more than 100 miles from your home, so you may be able to save some premium dollars even though you are keeping her listed on your policy. Another great way to save money on your insurance premium is through a Good Student Discount. Good Student Discounts are not just for your high schoolers. Undergraduates, and even Grad students, depending on their age, can see fairly substantial savings simply by maintaining a “B”, or better, average.
As you can see, when it comes to how mom and dad’s Personal insurance will cover their college-bound child it’s, well, personal. Coverage is going to largely depend on what form your policies were written on, what endorsements were included, and who the carrier is that writes the policy. We may not have a solution for that huge tuition bill, but we can help you protect you and your child from possible gaps in your insurance coverage.