When I went off to college, my focus was on what I needed to bring with me. I was going to college over 500 miles away so it was important to not forget anything. But for my parents, they had other concerns: how would they know I was protected, insurance-wise, while at college? Below are things to know about insurance and your college student.
We all know how much car insurance rises when your teenage child starts driving. The good news is that if your college student doesn’t take a car to college, you will see substantial savings to your insurance premium.
Typically, college has to be at least 100 miles away from your home to see the savings. On average, you can expect to see a 40% reduction. Even better, since they stay on your policy, they can drive the car when home on breaks and still be covered.
Of course, this only applies to you if your child doesn’t take a car to college. If they do, there are other factors, including where the college is located, that will determine what their insurance premium is.
With the passage of The Affordable Care Act, your college student can stay on your insurance until they are 26 years of age. But, this doesn’t mean there isn’t anything to worry about. Depending on where college is located, you need to determine if there are any in-network providers. Because of this, it is important to know what is covered and what is not covered by the out-of-network providers. In some cases, it might make sense to look into a basic student health policy so that they are covered should they need medical care.
In the case your student is not covered or wants their own insurance policy, you have to shop around for the best plan and price.
Your homeowners insurance will cover your college student’s belongings while out at school assuming they live on campus. Just make sure to talk with your insurance provider to make certain that there are no exceptions or changes to the policy coverage’s for your college student.
In the event your college child lives off campus, you are going to need to buy a renter’s insurance policy. Before you worry about covering the cost, understand that for a policy that will cover all of your child’s belongings, you can expect to pay around $125 a year.
Making sure you know how your health, car and renter’s insurance policies apply to your college student is a smart financial move to make. You don’t want to run into a situation where something happens only to find out you aren’t covered. Those smart with money and successful with their finances are proactive and know what coverage’s they have and how they work. Take the time to understand how your insurance works for your college student and you will be able to rest easier and know you are being smart with your finances.
Hi, my name is Jon and I run Compounding Pennies. I’ve been interested in personal finance since high school and love writing and talking about it. You can learn more about me in the Authors section of this site.