Review coverage for college students - Insurance - Brief Article

USA Today (Society for the Advancement of Education), August, 2002

Students heading off to college, especially for the first time, face many insurance issues they or their parents may not have considered, the Financial Planning Association, Denver, Colo., cautions:

Renter's insurance is probably the most-overlooked form of coverage when a student heads for college. Students today tend to own more valuable personal items in their dorm or off-campus apartment than in the past, and campuses are not immune to theft or damage. The Independent Insurance Agents of America estimates 100,000 property crimes occur on campuses annually. (That doesn't count off-campus crimes.) Beyond clothing and bedding, a student's room may contain a DVD player, television, computer, and stereo equipment. Students in apartments will likely have additional items such as kitchenware and furnishings.

The school or landlord will not cover loss of these contents in such events as fire or theft. The parents' homeowner's policy may or may not include the items. For students living in college housing, policies usually take care of contents up to 10% of the coverage of the parents' policy. For example, if the parents are covered for $75,000, the student is limited to $7,500. See whether your policy will cover contents and to what dollar maximum. You may need to buy extra coverage through your carrier or even buy a separate renter's policy.

On the other hand, your homeowner's policy probably will not cover contents in off-campus housing. You will most likely need to buy a separate renter's policy. Some policies will let roommates share the policy. Renter's policies are affordable, with annual premiums running $150 to $200 for coverage of $15,000 in personal property and $100,000 to $300,000 in liability.

Health insurance. First, find out what coverage your own medical policy will provide for your child, particularly if he or she is going to school out of state. It may not cover anything but emergency care. If the policy will still cover your child for routine care, it may require the student to switch to a primary care physician closer to where he or she is going to school, or you may need to get local referrals for his or her out-of-state care. Age is another factor. Policies generally stop coverage for offspring once they reach a certain age, even if still a dependent. That cutoff age typically is 23, but could be earlier. Policies will frequently not cover a child who is a part-time student.

If you don't have your own medical coverage, or your policy's coverage is limited, consider student health insurance that many colleges now offer. Typically, it's affordable, though coverage may be limited (such as none during summer break), with high deductibles. The student may be able to see a doctor or nurse for free or a nominal fee at the student health center, though more extensive care such as X-rays usually will cost.

Auto insurance. Seven in 10 students have cars at school, according to the Independent Insurance Agents of America. What impact having a family car at college will have on premiums depends in part on where the student goes to school. In some cases, coverage could go up; in other cases, it could go down. Regardless, failure to tell the carrier that your child has a car at school could jeopardize subsequent claims. Students earning good grades can help reduce premiums.

If your child lives away from the house and doesn't have a car at school, talk to your insurance agent to see if you can get a premium reduction now that he or she isn't a regular user. You could save hundreds of dollars or more, particularly if you have been paying high premiums for teenage drivers and the student is going to school far from home.

Life and disability insurance. Ideally, you should already have sufficient coverage to ensure that your offspring will be able to finish college should you die or be disabled. Packing your student off to college may be a good reminder in the event you haven't looked at those policies lately.