Kids Entering College? Time to Assess Insurance Needs
Filed under: In The News
The folks at the Insurance Information Institute suggest you add one more item: Make sure your child's insurance needs are covered. In a press release, they recommend creating a "dorm inventory."
That means making a list of the items your student plans to bring to school, along with its estimated value. III officials say to be sure to note specific high-value items such as computers, cameras or musical instruments and to keep receipts to document their retail value.
Having an up-to-date inventory can help determine how much insurance to purchase and get insurance claims settled faster in the event of theft, fire or other types of disasters.
III also recommends contacting your insurance agent or company representative. College may trigger the need for changes in insurance coverage, so ask about the insurance implications of becoming a full-time student and determine if supplemental insurance is needed.
Some homeowners and/or renters policies include protection for a college student's personal possessions (televisions, clothing and furniture) away from home if they live on campus and the student's property is stolen or damaged.
Other policies may limit the amount of coverage for a college student's belongings to 10 percent of the total amount of a policy's overall coverage for personal possessions.
So, if parents have $100,000 worth of personal possessions insurance for the family's primary residence, according to III, only $10,000 would be applicable to possessions in their youngster's dorm room. In both cases, the student's possessions would be covered for the same disasters that are covered in a standard homeowners or renters insurance policy. These risks would include fire, theft, vandalism and natural disasters such as a hurricane.
The student would not be covered for typical college type mishaps such as accidentally spilling coffee on an expensive electronic device.
Items such as jewelry and musical instruments may be subject to dollar limits under a standard homeowners or renters policy. If these limits are too low, parents may want to consider buying a personal property floater or an endorsement to their homeowners or renters policy.
This provides a higher amount of insurance and broader coverage. Most jewelry floaters, for instance, include additional coverage for "mysterious disappearance."
It may make sense for students to leave expensive jewelry at home or store it in a safe deposit box. Floaters for storing jewelry in a safe deposit box are generally less costly and many insurers will let you take jewelry out and wear it if you let them know in advance.
Start by teaching him that it is safe to do so.