FRIDAY, SEPTEMBER 23, 2016
Saying the last goodbye in the dorm parking lot, you realize more than ever that you can’t protect your child from every risk. It’s time to let go.
But back at home, you can assemble a strong financial safety net. Knowing what your current insurance will pay for — and whether you need to buy extra coverage — is a good first step.
Here’s how to evaluate your auto, homeowners, life and health insurance needs as your kid heads to college.
If your kid doesn’t take a car to school:
If your kid asks to take a car:
- Ask your insurer about an away-at-school discount. Some companies offer a price break if the college is at least 100 miles away from your home.
- Keep the student listed on your policy, so your son or daughter has coverage at home on breaks, says Scott Johnson, manager of Marindependent Insurance Services LLC in Mill Valley, California. Maintaining continuous auto liability insurance also keeps rates down over the long haul.
Car or no car, don’t forget about the good-student discount. Many insurers offer one for maintaining at least a B average.
- Consider the risks. “It’s the first time away from home. Why throw a vehicle into the mix?” Johnson says.
- Let your insurer know if your child takes a car. Some insurers might reprice the policy based on the school’s location, Johnson says. Your coverage price might go up or down.
Homeowners or renters insurance
Your child’s stuff will be covered under your homeowners or renters insurance in a campus dorm. Check your policy for details. Some policies limit coverage for belongings away from home to a percentage of the total amount of coverage for all possessions, according to the Insurance Information Institute. Typically there are also coverage limits on expensive items such as computers. Talk to your insurer about buying extra coverage for these items if necessary.
Students who live in off-campus apartments will need their own renters insurance policies. Renters insurance covers belongings and, like homeowners insurance, provides liability coverage if your kid inadvertently harms someone and is held responsible.
Make sure your liability insurance includes personal injury coverage, Johnson says. If not, you can add it for a small price, he says. Among other things, personal injury coverage would pay for legal defense and settlement costs if your son or daughter were sued for posting something objectionable on social media.
More changes are ahead as your child gains independence. Review your insurance policies annually to make sure you have the right coverage.
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