If Your Kid is in College, You Need to Read This

 By Catherine Powell

It’s a bittersweet thing when your child goes off to college.  On one hand, it’s a right of passage.  On the other, it can leave a void in any parent’s life.  Other than waiting for Spring Break to have your college student return to the nest laden with laundry, there is something else I’d like to suggest you do to help while away the time.  That’s because even though your grown child no longer lives under the same roof, he or she is anything but independent.  Even more important than helping them pay their way through college is for every parent to make sure that their needs are met.  One of those needs concerns insurance. 

1.      Wheeling and Dealing –As far as the insurance industry is concerned, whether your college kid lives in or out of state, they’re still considered a member of your household.  That means he or she can still be covered under your auto insurance policy.  Unless your child uses your car to commute to and from classes, you don’t have to list him or her as a daily driver.  This fact alone could save you a pretty penny on your premiums.  Even when your child returns home for visits, your coverage will still be in effect, unless you loan your car to your child for an extended period of time, such as during summer break to commute to and from work.  On the other hand, if you bought your college student a car, he or she will be required to register and insure it under their own name, even if you decide to pay the premiums yourself.  Either way, if your college kid is on the honor roll, let your insurance agent know this since some insurance companies offer a discount for students who have a high grade point average.

2.      The Dorm Room Blues – Living in a dorm room is less than what you’d call plush. If you thought your child’s bedroom was untidy when they lived at home, dorm life usually puts this concept on steroids.  Not to mention that many dorm rats let their friends and neighbors wander in and out at will.  The reason I point this out is to remind all you parents out there that all the expensive electronics, musical instruments and keepsakes your high school graduate took to college can be at risk of loss or theft.  That’s the bad news.  The good news is that you may be able to use your homeowner’s policy to cover your college student for losses incurred on and off-campus.  Some carriers allow parents to apply as much as 20% of their personal property protection to their college student.  That means if you have $100,000 of personal property coverage, up to $20,000 of it can be used for their benefit, even if your student decides to study for a semester abroad.  (Check with your agent for limits and exclusion.)

3.      Time to Do Your Homework – To make the most of this provision, you need to do a little homework.  To start with, you should inventory the belongings your child takes to college.  This should include receipts, photographs, and serial numbers of the items, along with the purchase price.  While you probably aren’t going to take the time to itemize everything your college-bound kid takes to college, you’d be well advised to scrupulously itemize everything with a value of $1,000 or more. 

4.      Should you consider purchasing renter’s insurance for your college student? – Since homeowner’s policies have strict limits on how much coverage is extended to particular items in your student’s possession, you might like to consider purchasing renter’s insurance to beef up the coverage.  Whether your college student is living on or off-campus, a renter’s policy is a cost-effective way to provide added [rotection.  For as little as $10-20 per month, a renter’s policy not only covers personal possessions but liability and some medical coverage as well. 

5.      What’s the best way to provide full medical coverage for your college student? – There are several ways to approach this subject.  The first is to find out if the college offers a student health plan.  If not, you can apply to have your coverage extended to your son or daughter until their 26^th birthday.  Then they are required to file independently. If you do decide to carry them under your plan, you need to make sure your student understands the coverage and network provided by your carrier.  Going outside the network could cost you dearly if they deviate from your healthcare plan.  Another option for out-of-state students is to have them apply in their state of residence for a Marketplace plan.  If your student does this, they need to include your income on their application.  You should also ask if both you and your student are eligible for a tax credit and/or a discount based on your household’s combined income. 

6.      What Color is Your Umbrella? – If you currently have an umbrella policy, the included liability protection may also extend to your college student.  That means that in the case of an auto accident or if an unfortunate incident were to occur at a party hosted by your child, they would be covered.  If another student or a guest were injured during or immediately after such a party, not only could your son or daughter wind up being sued, so could you.  If you have an umbrella policy in effect, ask your agent about the limits and exclusions.  If you don’t have such a policy, consider getting one.  For less than $500 per year, you will have up to $2 million in added liability coverage, which should help you sleep a little easier until your college student graduates.  

Catherine Powell is the owner of A Plus All Florida, Insurance in Orange Park, Florida.  To find out more ways to save on flood insurance, check out her website at http://aplusallfloridainsuranceinc.com