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Packed for college, but are you covered?

By August 9, 2022No Comments

Fall is near and that means that some big life changes might be happening in your household.  Some of you might be sending your kids off to college.  And the financial price tag for you might not just be the tuition.

During the school year, your child will be off on their own.  Living elsewhere with their possessions, no longer under your roof.  So how do you protect them (both your child and their possessions)? Perhaps renters insurance?  But to answer that question, you should probably know what renters insurance covers and then you can start to address some other variables to consider.

Renters insurance can be somewhat like your homeowners insurance except that it isn’t insuring a dwelling or home.  But most of the coverage is similar.

  1. Personal property – consider this all the stuff you are packing up in the car and taking to campus. Clothes, furniture, TVs, and those important things like laptops, cell phones and tablets.  Also, consider your child’s field of study.  Is it art or music?  If your child is going into a field that requires equipment that is more than just textbooks, you need to consider that too.
  2. Medical payments – perhaps not a huge concern if your child lives in a dorm, but off campus this could be a big one if someone gets hurt while visiting your kid’s off-campus house or apartment.
  3. Loss of use – what happens if your kid’s dorm or rental has enough damage that they need to be removed for a period of time? Where do they go?  They might need some form of temporary housing and if their school doesn’t have any, this coverage would help them cover the cost of other accommodations.
  4. Liability – You sent your kid to go off to college to learn and graduate. What could possibly go wrong?  I mean, college is all about studying.  There are no temptations, or your kid would never do anything wrong, right?  Damage to a dorm room or rental property could be covered from liability in a renters policy.  Perhaps your child’s housemate has a dog?  You certainly don’t want to be saddled with a dog bite claim.  And parties?  I have been to a kegger or two in my day.  Glad there weren’t cell phones back then.

So, at this point, you might be warming up to the idea that maybe you need to get a renters policy so what are the key things you need to consider (or questions you should ask) now that you are familiar with the coverage?

Won’t my homeowners insurance handle this?

The short answer is yes.  If your child would still legally reside with you then sure. But let’s think about the pros and cons.

Pros – it certainly would save you money.  Not a financial windfall but saves you money nonetheless and you know that it is taken care of.  However, if your child leases a property off campus you might not have a choice.

Cons – keep in mind that any claim filed is on your claim history now.  And frequency is one of the quickest ways to get a policy canceled.  You can often find a solid renters policy for $10 a month.  Totally worth it to preserve your good standing with your insurance carrier.

In addition, consider your deductible.  You might care a $1,000 or more deductible and it would become costly to replace these items.  Especially if your child has made the investment themselves.  Consider a lower deductible for a renters policy. $250 or $500.  It would increase the cost of the policy (albeit slightly) and you’ll be glad you did.

What about all those portable electronics?

Laptops, cell phones, tablets, and bicycles.  The most mobile of your kid’s possessions are ripe for theft.  But be careful, some policies will only cover these items for a certain dollar amount that might not cover the cost of replacing these.  Learn the limitations of the policy and consider scheduling these items on the renters policy.  Scheduled items can sometimes carry different deductibles and you could consider a $0 in this case.  As an aside mom and dad, look at your homeowners policy.  You have phones, laptops, and tablets too, right?  Talk to your agent to determine who you insure your own devices.

Can we just put all the roommates on one policy?

This might appear to be a good idea since you could discuss splitting the cost.  But in many instances, carriers will only let you add relatives to a policy.  And consider that the limits that you chose on a policy are now diluted between the number of roommates.  And how well do you know their roommates?  If you have a renters policy, the claim history is now your child’s.  You can’t account for how responsible the roommates might be with their property (or behavior).

What is dorm insurance, is it the same as renters insurance?

Not exactly.  If your child is living in a dorm, you may hear about dorm insurance policies.  The only coverage that it really has in common with a true renters policy is personal property. Most won’t have liability.  It really amounts to a personal articles policy.  Very limited overall.

So, what is covered when we insure personal property?

Besides the actual personal items your child owns, we answer this by discussing perils, settlements, and forms.

Perils – these are the causes of the claim.  Fire, water, theft, and vandalism are a few.

Settlement – will the items be replaced (replacement cost) or are you just taking a depreciated amount for your contents (actual cash value)?  Be very careful with this.  If you think this is a good learning moment for your kid to send them online and get a quote, you really need to double-check this.  Nothing would be worse than thinking you have a replacement cost policy and realizing that you are only getting a check for a depreciated basis that won’t cover the cost to replace that laptop.

Forms – This helps describe how broad the coverage would be to replace the contents.  Basic, broad, or special.  Always get special – always.  It leaves little room for discussion since it lists most perils as reasons you can file a claim.

For many of you, it is going to be tough to watch your kid go off to college.  But it is a big milestone so make sure that they go off protected now and in the future.  Spend the money.  There are reasonably priced policies out there to fit your needs and budget.  But always talk to an agent.  A good agent will provide you with sound advice.  We are here to help.  Call us at 513-444-2100 at any time.

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