Insurance for College Students
College kids show up at school with a lot more
than a big bag full of T-shirts and jeans. They also bring a slew of
electronics—computers, printers, smart phones, iPads—that can be
expensive to replace. Your homeowners insurance will generally cover
students’ possessions if they live in a dorm, and it may provide
coverage if they’re in an off-campus apartment, as long as their primary
residence is still your home. The rules vary a lot by insurer; most
require your child to be a full-time student and under age 24.
Some insurers cap the coverage at college
at 10% of the possessions limit on your homeowners policy. So if you
have a $200,000 policy on your home with 50% of that amount, or
$100,000, for contents, your kid’s coverage at college may be limited to
$10,000. The liability limits are usually the same as for you (see Check Up on Your Home Insurance).
If your insurer doesn’t cover your child’s off-campus apartment, or
if you’d like higher coverage limits, consider a renters insurance
policy. That generally costs just $150 to $200 per year, says Melanie
Loiselle-Mongeon, an independent agent in Pawtucket, R.I. If your kid
has roommates (who aren’t related), each person needs to get a separate
renters policy.
Car insurance. Contact your insurer if your kid goes to a
college more than 100 miles away and doesn’t take a car. Your premiums
can drop significantly (20% on average at Safeco, for example), but he
or she will still have coverage when home for the summer or vacations.
If your child takes a car to school, your insurance costs will rise or
fall depending on the location.
Health coverage. Student health plans, which often cost
hundreds of dollars each semester, may have exclusions and low coverage
caps, or they may require you to get most health care through the
student medical center. Children can usually be covered under their
parents’ health insurance policy until age 26, so most families can rely
on that insurance when their kid goes to college. (You may have to
decline the college’s student coverage to avoid being charged.)
However, if you have insurance through a regional HMO with a small
network of doctors and hospitals, coverage may be limited to emergency
services if your student goes to college in another state. And even if
your plan allows for out-of-network care, you’ll probably have to make
much larger co-payments if the network doesn’t extend to the area where
the college is located. Insurers with national plans, such as Cigna,
typically have plenty of doctors and hospitals in-network around the
country. “The best course of action is to request a summary of benefits
for the new location,” says Kelly Brooke, of Cigna.
If no in-network providers are nearby, consider an individual health
insurance policy. In most states, a healthy person in his or her early
twenties can get coverage for $150 or less per month. You can get price
quotes at eHealthInsurance.com or find out about local policies at HealthCare.gov.
By buying a high-deductible policy, you can keep premiums low and
still have coverage for major emergencies (most plans must also provide
some preventive-care benefits without co-payments or deductibles). If
your child has a policy with a deductible of at least $1,200 and isn’t
claimed as a dependent on your tax return, then he or she can make
tax-deductible contributions to a health savings account that can grow
tax-free for future medical expenses.
