Many college parents have gotten the call. “Mom, my bike was stolen,” or worse, “the fire sprinklers went off in my dorm and my computer and iPad were ruined by the water.”
This year, instead of dealing with the cost of replacing stolen or damaged property, college parents have a convenient and easy answer: renters insurance that contains useful and relevant features for students.
51% of college parents are concerned that theft of personal property could affect their child’s ability to be successful. Before your child heads off to college, come up with a plan for protecting your student’s personal items while there. Just in case something happens during midterms, you’ll be able to act quickly and get your student back on his feet without interrupting his studying.
Insurance is a way to protect your student’s belongings financially in the event of a covered loss, like theft or damage. Like you protect your home with homeowners or renters insurance, your student may also benefit from personal property and liability coverage while away at college.
Does your student really need renters insurance? If your family can afford to replace your students belongings should anything happen, you may not need the coverage. However, for many college families, that can be a large, unexpected expense on top of tuition. Also consider the unique risks students face at school. More than 30,000 burglaries are reported annually related to college students, including 15,000 residence hall burglaries, according to government data. And each year, fire departments respond to over 3,800 fires in dormitories, fraternities, sororities, and barracks, according to the NFPA. That’s about one per campus, every year! The threat these risks pose to your student’s property can be mitigated with certain insurance plans.
Evaluate Existing Coverage
Many parents may have some protection through their homeowners insurance. However, many families don’t realize the limitations homeowners insurance may present when covering a child away at college.
There are several key limitations to be aware of when considering relying on your homeowners insurance during the school year. These can vary from policy to policy, as well as from situation to situation. If you are considering using your homeowners insurance for protection at college, it is important that your family check on these possible coverage limitations to avoid going unknowingly uncovered. Read through your policy or call to speak with your agent to understand what your policy will cover for a child at school.
If your family does not have homeowners insurance or your student is not eligible under your homeowners insurance or renters insurance, a renters insurance policy for your student can be a cost-effective alternative that oftentimes offers more and more relevant coverage for a lower price.
When reviewing your homeowners policy, there are several things to look for to ensure it will provide adequate coverage at college.
- Check Full-Time Requirement: Review your policy’s eligibility requirements to see if there are any restrictions related to student status – many homeowners policies will cover full-time, but not part-time, college students. If your child is at risk for dropping below full-time status, your child could lose the protection offered by your insurance during the semester. In addition, many homeowners policies, personal property away from the principal residence will be covered only up to ten percent of the policy’s limits.
- Check On-Campus Only Restriction: Homeowners insurance policies will only cover eligible students living at school in on-campus housing. Coverage does not normally extend to off-campus housing and can expose your student and family to unexpected losses. If your child is living off-campus, be sure to consider renters insurance, especially since events at the apartment could affect your liability exposure.
- Check Age Limits: Also check your policy for any age limits that may exist. Coverage is not normally available for adult children who are not enrolled full-time in college, however, some policies provide coverage to full-time college students under the age of 26.
- Check your Deductible: Many families now have a $1,000 deductible for homeowners insurance claims and as a result, small claims by your student may not practically be covered. Most renters insurance policies have a deductible as low as $100 per claim.
Is Renters Insurance Right for Your College Student and Family?
Though your child may be eligible for some coverage under your homeowners insurance policy, the nuances of your homeowners coverage can be costly. That could be part of the rationale for 28 state insurance commissioners recommend that students seriously consider renters insurance for their college students.
Even if your student is eligible to receive personal property and liability protection under your homeowners insurance, for an affordable cost, renters insurance is a practical way to protect your investment in a college education. According to the Insurance Information Institute, the average annual cost of a renters insurance policy in 2012 was $187 (the most recent data available). In that case, if you choose a low deductible, say $100, if your student has to file a claim, the out-of-pocket cost for the premium and the deductible will be less than your typical homeowners deductible.
More than property coverage, true renters insurance provides both personal property and liability coverage for your student. Therefore, be sure to identify a plan that is not just property coverage but real renters insurance.
Certain colleges and universities now recommend renters insurance coverage for their students and make it convenient for campus residents to purchase. To determine what coverage your student will need while at college use this inventory calculator to identify the cost of replacing them if they were stolen or damaged.
In addition to calculating your coverage needs correctly, be sure to consider a renters insurance plan that includes other relevant features that benefit college students such as:
- Replacement Cost: look for a plan that replaces items at replacement cost, not the depreciated value of the item, and one that has electronics coverage up to the policy limits.
- Protection Beyond Campus: Consider whether worldwide coverage makes sense for your student, if they are planning on visiting friends studying abroad or going on Spring Break.
- No Difficult Student Restrictions: Such as requiring your student to provide a FICO credit score or be 18.
Before the school year begins, be sure to speak with your insurance agent who can help you understand the nuances of your homeowners coverage. You may also want to consider a student-specific plan designed for college life, like GradGuard Renters Insurance, which includes liability and full-replacement cost coverage.
Planning ahead and doing your research can help protect your family financially from losses and damage to your student’s personal property while at school. However, if you choose to protect your student, be confident that you are well prepared to help your student achieve their goal of completing a college education.