Students who are already buying laptops, textbooks, and other campus equipment might want to add something else to their list: renter’s insurance.
Insurance can help pay for personal property that is stolen or damaged by accidents like kitchen fires. It provides liability coverage to help cover medical and legal costs if someone is injured in your home or someone’s property is damaged. And some policies pay for a hotel and meals, if a calamity renders the property unlivable.
Students may think they don’t have a lot of equipment, but the replacement of clothing, furniture, and electronic gadgets all add up. A stolen backpack with a laptop, tablet and textbooks can easily total $3,000, said John Fees, co-founder and chief executive of GradGuard, which markets student rental policies.
Students living in dormitories may get partial coverage through their parents’ home insurance policies, said Loretta Worters, spokeswoman for the Insurance Information Institute, an industry group. This “off-premises” coverage, however, is often less than the owner’s policy benefit limit, say 10%. If the policy covered personal effects up to $100,000, coverage for the dormitory would be $10,000.
“You might not have such strong coverage anywhere else,” said Karen Collins, assistant vice president of personal lines at the American Property Casualty Insurance Association, an industry group.
Some homeowner policies don’t automatically include a student’s residence, so it’s best to confirm coverage, Fees said. Homeowner’s policies often have a higher deductible — an amount that’s subtracted from paying a claim — 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 landlords who rent off-campus accommodation 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 on the property itself,” she said, “but that doesn’t include the tenant’s property.”
If you have a tenant’s policy, your belongings are often covered even if they are stolen away from home. Ms Alvarado recalled that when she was at university her laptop was stolen from her car and her rental policy paid to replace it.
A rental policy does not cover everything. The policy can protect you if someone trips and gets hurt in your apartment, but not if a guest intentionally punches a hole in the wall, Ms. Alvarado said: “That’s what the security deposit is for.”
The average annual tenant premium was $174 in 2019, according to the Insurance Information Institute. Some fonts cost less. Lemonade, an online insurer, offers basic policies starting at $5 per month.
Coverage details may vary by state and carrier. Make sure the maximum policy benefit is high enough to cover your property. Always check whether the policy pays the cost of replacing damaged goods rather than the actual cash value, which may be lower, and whether it lists any exclusions. Policy language can be confusing, so ask if you don’t understand something.
Students with items that exceed their policy’s coverage amount, such as special computer equipment or musical instruments, may be able to add them for an additional fee, Worters said.
A tenant’s policy usually covers water damage caused by accidentally triggered sprinkler systems or rain entering through a damaged roof, but not usually by flood water flowing from the ground. For that, you would need a flood insurance Politics.
How common is water damage caused by irrigation system misadventures? “I wouldn’t describe this as common, but when it happens it matters,” said Josh Gana, director of facilities and physical environment for the Association of College and University Housing Officers-International.
Students can mistakenly activate a sprinkler by hitting a ball around the room or snagging something on a device in the system, he said. Water can soak a room quickly, and attached sprinklers can also damage other students’ belongings.
After a fatal dormitory fire in 2000 at Seton Hall University, other colleges installed fire suppression systems, Fees said. There were about 1,200 fires in on-campus housing in 2020, according to federal data.
Here are some college insurance questions and answers:
Will my tenant’s policy cover my roommate’s belongings?
No. Some insurers can add a roommate to your policy for a slightly higher premium, Worters said. Otherwise, your roommate would need a separate policy to be covered.
Does renter’s insurance pay for repairs if I drop my laptop?
Not likely. Renter’s policies typically cover laptop theft as well as damage or destruction by fire or other “perils.” But dropping the device from a desk and breaking the screen is not permissible. Special laptop plans offered by some insurers and device manufacturers, or an extended warranty or service contract, may provide coverage. consumer reports found little benefit in extended computer warranties, however, because the cost is similar to the cost of a repair.
Can I get a discount on my car insurance if my student is away at university?
Car rates are generally higher for teenagers. But if your student is away and not driving your car, you may qualify for a lower rate, so check with your insurer, said Robert Passmore, vice president of auto policy and claims at American Property Casualty. Insurance Association.