College students who are already buying laptops, textbooks, and other campus gear might want to add something else to their list: renters insurance.
Insurance can help pay for personal property that has been stolen or damaged by accidents such as a fire while cooking. It offers liability insurance to cover medical and legal expenses if someone is injured or someone’s property is damaged at your location. And some policies pay for hotels and meals if a disaster renders the property unlivable.
Students may think they don’t have a lot of equipment, but replacing clothes, furniture, and electronic devices adds to the work. A stolen backpack containing a laptop, tablet and textbooks can easily cost $3,000, said John Fee, co-founder and chief executive officer of GradGuard, which markets student insurance policies.
Loretta Worters, a spokeswoman for the Insurance Information Institute, an industry group, said students living in dormitories may receive partial coverage from their parents’ homeownership policies. However, this “off-premises” coverage is often less than the homeowner’s policy benefit limit — say 10 percent. If the policy covers items up to $100,000, dorm coverage is $10,000.
“You can’t have strong coverage anywhere else,” said Karen Collins, associate vice president of personal insurance at the American Property Casualty Insurance Association, an industry group.
Some home ownership policies don’t automatically cover a student’s residency, so it’s best to confirm coverage, Mr Fees said. Homeowner policies often have a higher deductible — an amount that can be deducted from a claim payment — than a renter’s policy, he said.
Some colleges may require students to purchase insurance as part of their on-campus housing contract. And many property owners who rent off-campus apartments require students to purchase coverage, said Alexandra Alvarado, director of marketing and education for the American Apartment Owners Association, which provides services to landlords.
“The landlord has insurance for the property itself,” she said, “but it doesn’t cover the renter’s property.”
If you have a renters policy, your belongings are often insured even if they are stolen from the house. Ms. Alvarado recalled her laptop being stolen from her car while she was in college and her landlord’s policy paid to replace it.
A renter’s policy doesn’t cover everything. If someone breaks into your home and gets hurt, the policy can protect you, but if a guest intentionally poke a hole in the wall, Ms. Alvarado said, “That’s what the bail is for.”
According to the Insurance Information Institute, the median annual renter premium in 2019 was $174. Some policies cost less. Lemonade, an online insurer, offers basic policies starting at $5 per month.
Coverage details may vary by state and insurer. Make sure the policy’s maximum benefit is sufficient to cover your property. Always check that the policy pays the replacement cost of the damaged property rather than the actual cash value which may be less and that any exclusions are listed. The language of the policy can be confusing, so ask if you don’t understand something.
Ms Warters said students with items like specialized computer equipment or musical instruments that exceed their policy’s coverage amount could potentially add them at an additional cost.
A renter’s policy will typically cover water damage caused by sprinkler systems being accidentally turned off or entered through a rain-damaged roof – but not usually flood water draining off the ground. . You need flood insurance for this.
How often is water damage caused by a sprinkler system accident? “I wouldn’t call it normal, but when it is, it’s important,” said Josh Gan, director of facilities and physical environment at the Association of College and University Housing Officers-International.
Students can also accidentally activate a sprinkler by throwing a ball across the room or by hanging something on a system fixture, he said. Water can suck up a room quickly, and connected sprinklers can also damage other students’ belongings.
After a fatal fire at a dormitory at Seton Hall University in 2000, more colleges installed fire suppression systems, Mr Fees said. According to federal data, there were about 1,200 fires in on-campus housing in 2020.
Here are some questions and answers about insurance at school:
Does my renter’s policy cover my roommate’s belongings?
no Some insurers can add a roommate to your policy for a slightly higher premium, Ms Worters said. If not, your roommate will need a separate insurance policy.
Will renter’s insurance pay for repairs if I drop my laptop?
unlikely. Renter’s policies typically cover damage or destruction caused by theft of a laptop, as well as fire or other “hazards”. But putting the device down from the desk and breaking the screen is not worth it. Special laptop plans offered by some insurers and device manufacturers, or an extended warranty or service contract may provide coverage. However, consumer reports found little benefit in extended computer warranties since the cost is similar to the cost of repairs.
Can I get a discount on my car insurance if my student is studying?
Auto fares are usually higher for teenagers. But if your student is away and not driving your car, you may be eligible for a lower rate, so check with your insurer, says Robert Passmore, vice president of auto and casualty policies at the American Property Casualty Insurance Association. Hm.
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