Insurance Considerations for Parents with College Kids

In today’s world, college students arrive on campus with more than their clothes, notebooks and pencils. They usually come with an arsenal of electronic gadgets. Laptops, smart phones, mp3 players, tablet PCs, printers and other devices are usually in their luggage. In some cases, today’s college students may not even live on campus. They may live hundreds of miles from their campuses. However, every college student has more expensive learning supplies than students in the past did. The belongings of college kids living in dorms will usually be covered under a homeowners insurance policy. Full-time students living off campus may also be covered if their primary residence is still their parents’ home. Insurers have several other qualification criteria, and they usually place a maximum age limit of 24.

Although the liability limits of a homeowners insurance policy usually apply equally to covered college students, many insurers place a 10 percent cap on the possessions limit. However, some insurers may not have sufficient provisions to cover college kids in certain situations. Many parents want to purchase additional coverage to ensure their kids will be taken care of. A renters insurance policy is often the best solution. It usually costs between $150 and $200 annually. If a child will be living with roommates, the policy will not cover the roommates’ possessions. Another important possession to consider is a college kid’s car.

Parents should ensure their kids are fully covered when going to college. Rates will fall or rise depending on the school’s location. Some students may opt to attend college without taking a car. This is especially true for students who attend college in large cities where efficient bus systems exist. When this happens, parents should contact their insurers if the campus is at least 100 miles away. In many cases, parents receive a discount totaling up to 20 percent. However, students will still be covered on holiday visits and during summers at home.

Another important consideration is health insurance. Many college kids are known for making poor nutritional choices, experiencing high stress and not getting enough sleep. These factors can add up to more trips to the doctor. As a rule, student health plans offered by schools are very limited. They are expensive, have low cap amounts and may require students to seek care only on campus. Since children are usually covered by their parents’ medical insurance, most parents opt to rely on this type of coverage. However, children of parents with limited HMO plans may only be able to seek emergency treatment on campus. This could mean much higher bills or higher copay amounts.

An individual health insurance policy may be the best option for parents who have limited HMO plans. At about $150 less per month for one individual, these plans are affordable. Premiums are lower with high deductibles. Students with plans featuring a deductible of $1,200 or more may open a health savings account and make contributions without tax penalties.

Another consideration for college students is identity theft insurance. Typically, this coverage is limited. It cannot prevent parents or students from becoming victims of identity theft, and it doesn’t cover financial losses directly.  However, it does give coverage for the cost of reclaiming you or your student’s financial identity.  For instance,it may cover the costs of making copies, making phone calls, mailing documents, lost wages, and attorney fees.  Parents should check first to see if their homeowners policy includes identity theft insurance while the student is away from the family home. If a student is renting an apartment, ask if his/her renters insurance covers identity theft, or if that could be added to the policy. 

To learn more about insurance options for college students, discuss these issues with an agent.

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