Is My Kid Covered? The Need for College Students to Have Insurance

Insurance is one of those topics parents forget during the transition to college. The goal is getting students settled in a dorm or an apartment. Parents do not question coverage until receiving a phone call that says, “Mom I dropped my laptop” as Kiplinger Personal Finance writer, Jane Bennet-Clark writes. The fact is over 80 percent of students may not have adequate liability insurance to protect against property loss. Also, 1 in 7 has little to no health insurance, according to the Independent Insurance Agents of Texas (IIAT). Insurance needs change at different stages of life. It is no different for your child, whom you know better than anyone. Picture your kid on campus in an unsupervised environment. What calamities might ensue? Revisit your health insurance policy, auto insurance policy and homeowner’s insurance policy.

Parents should add up all the valuables a student brings to campus – netbook, smart phone, mp3 player, bike, textbooks, etc. A property inventory checklist is available to download at the National Association of Insurance Commissioners (NAIC) website. Homeowner’s insurance covers 10 percent of personal property away from home. IIAT says a policy with $100,000 worth of coverage on personal property provides $10,000 to students on campus. To be eligible, the student must be covered under the homeowner’s policy and be a legal resident of the household.

Be aware that some property insurance policies only cover full time students under the age of 23. This means gaps in coverage as course loads vary between semesters. Parents can purchase separate property insurance coverage to curtail a higher deductible and filing multiple claims, according to Bennet-Clark. Safeware.com offers $1,000 worth of student laptop insurance for a year at an affordable rate with no deductible.

Consider renter’s insurance for a college student living off campus. It safeguards property in case of theft, fire and assorted disasters. Renter’s insurance also provides liability protection against damage to an apartment or injury to another person on the property. Get renter’s insurance if you are asked to cosign a lease. Most landlords insist parents cosign when students lack credit. Sometimes the landlord only wants one name on the lease, even if multiple students rent the apartment. In those instances, Bennet-Clark says have each parent sign an agreement to cover any damages to the property caused by his child.

Health Insurance for college students is another biggie. Verify that you child is covered. A survey said 84 percent of parents assumed family health insurance plans covered students throughout college, according to IIAT. This is true for fulltime students under the age of 23, meaning 12 credits per semester and 6 in the summer. This is not true for graduate students or part-time students.

If your child is a first year student, NAIC offers the following advice. Give a copy of the health insurance card to your child. Explain referrals and approvals that may be necessary for treatment. Parents insured with a home maintenance organization (HMO) should determine if the college student will be in the service area. If not, the college student will probably receive emergency care, but may have to go to a doctor inside the HMO service area for non-emergency treatment. Similarly, parents insured by a preferred provider organization (PPO) can expect the insurer to pay out-of-network levels if the child is outside the network. Sometimes seeking treatment in the network service area is not an option. When this situation arises, think about enrolling in the college’s health insurance plan.

A college does not always allow first year students to have a car on campus. There are potential gaps in coverage even if your student doesn’t plan to bring the car. He may borrow a car or be a passenger. In those cases, IIAT says a Named Non-Owner Auto-Policy covers driving related activity like riding in a car. If your college student plans to have a car on campus, compare rates. The rate for auto insurance can increase or decrease depending on location. NAIC urges parents to ask about the rates for the college location before deciding to keep the student’s car on the family’s auto insurance plan. Remember to ask about grade based discounts too. Your auto insurance company may provide a discount if your child maintains a certain G.P.A. Sometimes it pays to brag.