It is a hectic and bittersweet time as your children head off to college. There are so many issues to consider that it is easy to forget one important aspect — insurance.
Insurance policies and coverage will generally change once your children are no longer under your roof. However, with some planning, those changes may be to your advantage. Review all the types of insurance policies that you have, starting with these common ones.
- Homeowner's Insurance – Make an inventory of all items your child is taking to school that you would expect insurance to replace if they were stolen. Write down all serial numbers, and take pictures for reference.
Check your homeowner’s policy for your child’s personal property coverage while living in dorms. What are the limitations on the events covered and the amount? Is accidental damage covered and under what restrictions? You may need to consider riders for additional coverage for computers, jewelry, or high-end electronics. Off-campus housing will likely require a separate rental insurance policy.
- Auto Insurance – Decide whether your child is taking a car with him or her to campus, and talk with your insurance agent about how this will change your coverage. Your agent will have to reassess the coverage based on where the college is located, what the new driving habits are likely to be, and if new registration is required. Do not forget to look into any student or parent discounts that apply.
If your student normally drives a car but is leaving it at home, you will need to decide whether to add any other drivers onto that car (if he or she is the only driver currently listed). If not, you may be able to get discounts for the amount of time it will be sitting in the garage while your child is away.
Some college campuses offer Zipcars or similar daily rental services. If your student plans to use those, find out if they are covered under your policy under the same sort of arrangement as standard rental cars and check for any loopholes. Otherwise, if your child uses these services, they may need to accept the insurance at rental.
It is almost certainly going to be collectively cheaper to keep your child on your policy instead of getting them a separate policy, unless you are higher risk than they are through past accidents or DUIs. In that train of thought, remember to counsel your child against high-risk behaviors such as texting while driving or driving drunk. You will get the typical teenage eye roll in response, but do it anyway.
- Health Insurance – With the Affordable Care Act, your children should still be covered under your existing healthcare policy. However, if your child is going far away to college, the local health systems may not be part of your existing healthcare system’s network. Take the time to check with your child’s college and your insurer to find out what is covered through the on-campus health facilities and what is covered at the nearby hospitals should anything major arise. It is possible that the better deal overall may be to insure your child separately.
Do not forget to check into prescription drug coverage and auxiliaries like dental and optical care if your current insurance package covers those areas.
We hope you do not have to use these policies at all, but if you do, it is best that you put some thought into your options. At best, you will have peace of mind, and at worst, you will be covered for any critical needs that arise.