Students begin heading for college this week and classes will start in the next week or two. Along with the clothing, furniture, decorative items, and supplies they’ll be taking, there will also be smart phones, tablets, laptops, mini fridges, microwaves, coffee pots, game consoles, and a host of items to outfit the new dorm room or apartment.
What’s the best way to insure the personal property your student takes with them? This largely depends on where they’ll live, but there are actually two ways to approach this; your home insurance policy or a renter’s insurance policy.
Dorm Room: If your son or daughter will be living on-campus in either a dormitory or in a sorority or fraternity house, there’s no need for a renter’s insurance policy. Your son or daughter’s items are usually covered by your home insurance policy. Most home insurance policies will cover up to 10% of the personal property or contents amount off-premises. Off-premises can be contents in your car, a storage facility, a dorm room or room in a Greek house. For example:
- A home valued at $200,000 will have contents coverage ranging from 60% to 75% of the home’s value or $120,000 to $150,000
- Off-premises contents coverage will range from $12,000 to $15,000
- This should be more than enough coverage for the typical dorm room
The only caveat is anything lost or stolen of your student’s personal property will be subject to the home insurance policy’s deductible. For Texas home insurance policies, the deductible will range from $1,000 to 1% of the home’s dwelling value. In the above example, the home policy deductible will be $2,000 if there’s a 1% deductible.
In instances where the student is taking electronics, smart phones, or musical instruments, I recommend scheduling them on the home policy. Scheduling items on a home policy simply means listing them for their stated value under the scheduled items portion of the policy.
Most home insurance policies have the option to schedule electronics, smart phones and musical instruments your student takes with them. If they are damaged, lost or stolen the deductible will be only $0 to $100 instead of $1,000 or 1%. The cost to schedule these items is nominal, and much less than it costs to replace them. Be sure to include printers, accessories, and software costs with scheduled laptops and tablets.
Apartments & Rental Homes: If your student will live off campus in an apartment or rent a home with friends, they will be better served with a renter’s insurance policy. It will cover them for losses such as a leaking water pipe, fire, etc. in addition to if an item becomes lost or stolen. It will also provide personal liability coverage if someone is hurt on the apartment or home’s premises.
Renter’s policy rates are determined by the amount of the contents coverage, what type of home the student is living in (apartment or home, brick or wood exterior, etc.), where the home is located (large city such as Dallas, Fort Worth, Houston, Austin or a smaller town such as College Station, Lubbock, Abilene, etc.). There are discounts for protective devices such as fire and burglar alarms. Rates are usually in the $150 to $300 range with deductibles of $250, $500, and $1,000 being common.
If your son or daughter is going to school out of state and you pursue a renter’s policy, you’ll need to get one that’s specific to that state and from an agent that’s licensed in that state. For instance, if you have a child attending the University of Oklahoma, they’ll need an Oklahoma renter’s policy written by an agent that’s licensed to write insurance in Oklahoma.
If you elect to simply have your home insurance cover your student’s property, there’s no need to have a state specific alteration to your home policy. Your student’s property will be covered in any state in the US. If they are attending school out of the country, then seek coverage that’s written in that country.
What did you do for your college student? Share your experiences, comments, advice, and questions with us in the comments section of our blog or on our Facebook page. I’ll answer all questions and our readers will appreciate the advice of those that have gone before them!