Insurance Blog
Wednesday, 23 August 2017 18:46

Does Your Your College-Bound Child Need Renters Insurance?

What You Need to Know About Dorm & Renters Insurance For College Students

If your college-bound student will be living in a dorm or other campus housing, her belongings may be covered under your homeowners or renters insurance policy. However, the Insurance Information Institute (III) says that some policies limit coverage for belongings while your student is away from the your home. Dorm insurance protects your student's personal property against damage or loss, and renters insures both of you in case someone is injured while on non-campus residences.


Do Students Need Renters Insurance?

A college student who is under 26 years old, enrolled in classes, and living in on-campus housing, may be covered under your homeowners/renters insurance policy. But, even if a student is a dependent under his or her parent's insurance, the student's personal property, in many cases, is not covered if the student lives off-campus. Furthermore, coverage for on-campus losses depends on the insurance carrier and your insurance deductible. (See: Choosing The Right Coverage.)

College students living in off-campus housing are ideal candidates for renters insurance, since many students bring thousands of dollars worth of personal items, such as electronics, a computer, televisions, gaming devices, bicycles, and furniture with them to their home away from home. As a renter, It is their—  or perhaps your — responsibility to provide coverage for these valuable items. The landlord’s insurance does not cover their personal property in the event that it is stolen or damaged as a result of a fire, theft or other unexpected circumstance. 

Choosing The Right Coverage

An important factor to consider when choosing renters insurance is actual the cash value vs. the replacement cost coverage.

Actual cash-value coverage will reimburse the cost of the personal property at the time of the claim, minus the deductible. It’s important to account for depreciation when considering this coverage option. For example, if a stereo system were stolen from an apartment five years after the stereo was purchased, the policyholder would be reimbursed for the current value of the system.

Replacement cost coverage, on the other hand, will reimburse the full value of the new stereo system after submitting purchase receipts. While the up-front cost is greater, you are more likely to receive accurate compensation for your possessions.

What Are My Policy Options?

You have three options when choosing coverage for your student:

  1. Your Homeowners Policy
    Your homeowners policy will typically cover your offspring while they are living in on-campus at no extra cost. But the coverage is usually only 10 percent of your limit on the contents of your home. So if your policy covers up to $50,000 in losses, your student’s belongings are covered for only up to $5,000. Your insurance carrier may cover your child's belongings under your policy depending on their age and student status. However, you will still be responsible for your deductible.
  2. A Separate Renters Policy
    A renters policy costing $11 to $22 per month on average, depending on the state, will be necessary if your child lives in an apartment off-campus because your homeowners insurance won’t extend there. Premiums vary based on the amount of coverage needed.
  3. Dorm Insurance Policy
    A dorm insurance policy may be your best option for your on-campus student because deductibles are as low as $25, vs. $500 to $1,500 on home insurance policies. Also, your home coverage should really be reserved for bigger claims involving damage to the structure and contents, not smaller losses like a purloined computer. A $5,000 policy with a $25 deductible might cost $140 per year.

Is There A Real Threat Of Loss Or Theft?

It’s wise to research reported thefts and burglaries where your student will attend college, as the rates vary widely by school and location.

According to FBI data, the University of California, San Francisco, had the highest crime rate in 2015. Its 421 burglaries and larceny thefts for a student body of just 3,170 extrapolate to a rate of 13,281 per 100,000 students. In Massachusetts, the top three colleges and universities with the highest theft rates in 2015 were Boston University, Harvard University and Northeastern University. The FBI’s 2015 Crime in the United States statistics lists theft and loss rates for reporting universities and colleges by state.

What Happens If We Have A Claim?

When you submit a claim, the insurance company will ask for proof of purchase with the purchase price, as well as model numbers and serial numbers. It's a good idea to take photos or video footage of any personal possessions for documentation — be sure to store this information in a secure, off-site location.

How Can We Prevent Theft And Loss While At College?

No one wants to experience a loss either at home or away at school. Here are five ways to help minimize your student's chances of becoming a victim of theft while away at school.

  1. Leave valuables at home. Keep expensive items at home — especially those with nostalgic value that can’t be replaced. 
  2. Don’t leave items unattended. Your student may be unaware that thieves are everywhere, such as school’s library. He might be tempted to leave 
belongings, such as cellphones and laptops, unattended for a few minutes... but that's all it takes for a thief to abscond with unattended items.
  3. Keep financial documents in a safe place. Credit and debit cards should be kept in a thin wallet in a secure location. Anything with an account number, Social Security number or date
 of birth on it should be stored in a safe place, such as a locked drawer.
  4. Locks for laptops. A laptop security cable lock generally works by affixing one end to your laptop and the other to any secure object, like a desk leg or anchor affixed to the desk or wall, and accessing it only via a combination lock or key.
  5. Limit sharing of keys. Encourage your son or daughter to share keys with roommates only. 

How Do I Find Out My Best Options For Dorm Or Renters Insurance?

Give us a call at 800-590-5383. In a matter of minutes, we'll review your homeowner's policy with you to help you make the best decision for your child while away at school. 

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Sources: NAIC, FBI, Consumer Reports

Read 1265 times Last modified on Thursday, 05 October 2017 14:20

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