August is here, and the start of fall classes is just around the corner. I usually have a couple of phone calls from clients whose son or daughter are about to head to school and they want to confirm that their stuff is covered. The answer is usually yes, but there are a couple of considerations worth confirming. Let’s view this in light of where the student will live.
Dorm Room: If your son or daughter will live on-campus in a dormitory they don’t need renter’s insurance. Most home insurance policies provide coverage for personal property off premises which includes items stored in a dorm room, storage unit, etc. The amount varies by home insurance carrier, but typically falls in the 10% to 20% of the personal property or contents amount.
For example, a home insured for $200,000 will have contents coverage ranging from 60% to 75% of the home’s value or $120,000 to $150,000. The amount of off-premises contents coverage will range from $12,000 to $30,000, which should be more than enough coverage for the typical dorm room.
The only caveat is anything lost or stolen is subject to the home insurance policy deductible. Texas home insurance policies have an all other perils deductible of $1,000 to 1% of the home’s dwelling value or $2,000 if there’s a 1% deductible for a home with an insured value of $200,000.
Items such as smart phones, laptops, tablets, and musical instruments can be scheduled on most home policies. Scheduling an item on a home policy simply means listing the item or items for their stated value under the scheduled items portion of the policy. This is optional coverage on most home policies and will be a small cost to add it. It also usually means there’s either no deductible or a small deductible such as $100.
Apartments & Rent Homes: Many students move into an apartment or rent a home after the first or second year at school. Your home insurance policy may cover this too, however, you may have to extend the liability coverage to a second location or home for you to be protected if someone does something “entertaining!” If your home policy won’t extend liability coverage to your student’s new abode, I recommend renter’s insurance. This may also be required if your student is going to school out of state.
Renter’s insurance policy rates are determined by the amount of the contents coverage, what type of home the student is living in, where the home is located and protective devices such as fire and burglar alarms. The cost of a renter’s policy will range from $150 to $300 a year. Common deductibles are stated in dollar amounts such as $250, $500, and $1,000 depending on the carrier.
If they have roommates living with them, each roommate will also need their own renter’s policy, as renter’s insurance only covers the items owned by each individual person. Renter’s policies also provide personal liability coverage for your student which is needed should someone get hurt when visiting the apartment or home, even if they are not invited.
Students attending an out of state school will need to get a renter’s policy specific to that state and from an agent licensed in that state. For those students attending school abroad, they’ll need coverage which is written in that country. Share where your student will attend college along with your questions, comments, and experiences with me on my Facebook, Google +, or LinkedIn pages. I’d love to hear from you!