Whether you live on campus or off, you're going to want to protect your stuff from fire, thieves, vandalism, and more. Renters insurance is the solution.
When you're preparing to leave for college, one of the last things that's likely to be on your mind is renters insurance.
You certainly aren't alone if this form of insurance barely registers on your radar. After all, only 37 percent of American renters currently pay for a renters insurance policy, according to a 2014 poll conducted for the Insurance Information Institute by ORC International. (This compares to the 95 percent of homeowners who were found by the same study to have a homeowners insurance policy.)
The 63 percent of renters who ignore renters insurance do so at a pretty great risk, though, as it could protect them—and their bank accounts--from a whole host of perils. Among them: damage and destruction caused by fire, lightning, hurricanes, or even things like vandalism and burst water pipes. Theft also is covered by most renters policies, as are liability and additional living expenses (in the event that you're forced to move out because of a storm or fire, for example).
The following cautionary tales should make it crystal clear why college students need renters insurance. Students living off-campus, and not in dorms should pay extra attention.
If you experienced any of the unfortunate events detailed above, renters insurance would have protected you from most, if not all, of the costs usually associated with them.
That's because, as mentioned earlier, renters insurance generally offers the people who buy it—whether they're college students or not--three basic types of protection:
Your stuff is covered if they're stolen or damaged or destroyed by disasters named in your policy.
This aspect of renters insurance protects you if someone is injured while in your dorm, apartment, or house. Specifically, it covers both medical expenses related to those injuries as well as legal fees that could follow in their wake (such as if the friend who put his hand through your TV decides to sue you).
If you're forced to move out of your apartment, dorm, or house, this is what you'll rely on for assistance. It typically covers the cost of a hotel or similar accommodations while you wait for the okay to return home.
That's hardly all there is to know about renters insurance, of course—or what it has to offer college students, or why they should spend money on it.
Here are a handful of noteworthy cases in point:
Despite what you may think, renters insurance isn't expensive—especially when compared to other kinds of insurance like health and life. In fact, it's pretty cheap, with most policies costing somewhere between $150 and $300 per year. What you pay will depend on the location of your apartment or house, as well as its size and the coverage amount.
Before you can figure out how much coverage you need, you'll probably want to create an inventory. This list should include everything you'll be taking with you to college.
An inventory also will come in handy if you need to repair or replace any possessions that are damaged or stolen.
Thankfully, making an inventory isn't hard. In fact, some students may not need to do much more than come up with a pen-and-paper record of their possessions. A few extra options, says John Marques, senior vice president of property pricing and product manager for Chubb Personal Insurance, are to "take pictures of [your] electronic gear, record the serial numbers, and store receipts in a safe location. That way you have the proper documentation should a loss occur." For a few more tips and tricks related to creating an inventory, read our article Create an Inventory of Your Possessions for Homeowners Insurance Claims.
Considering the belongings you take with you to campus probably are just as likely to be stolen as they are to be damaged or destroyed, Marques recommends making sure they're "locked down" whenever possible.
"Laptops, digital cameras, other electronic equipment, and private documents should be secured in a safe when not being used," he says. "Although these high-ticket gadgets and sensitive papers can still 'walk' unless the safe is bolted to the ground, this will most likely deter a common thief or a dormitory neighbor with sticky fingers."
Even though renters insurance is cheap, there are many students who will avoid it. Some just want to (or need to) hold on to as much of their hard-earned cash as possible.
If that describes you, and if it's prompting you to consider sharing or splitting a renters insurance policy with one or more roommates, you're going to want to put the kibosh on that line of thinking right now.
For starters, renters insurance is designed to be used by individuals and families. It's not made to be used by two (or more) unrelated people. In fact, although some companies will allow two people who are married to each other to be named on a single renters policy, that's as far as they'll go. So, if you live in a house with three or four friends, you're basically going to be forced to buy your own policy if you want to protect all of your stuff with this kind of insurance.
Even when you find yourself in a situation where sharing a policy (with a single roommate) is possible and maybe seems appealing, though, you're probably going to want to avoid it. For more on why this is, read our article, "Why You Shouldn't Share Renters Insurance with Roommates."
A lot of people ignore renters insurance because they mistakenly assume their landlord's insurance will cover their belongings in the event of a disaster or mishap. Unfortunately, that's not the case. "The landlord’s insurance obligation extends only to the apartment building or house occupied by the renters," Marques explains. "Each renter is responsible for insuring his or her personal property."
This piece of advice is intended mostly for parents, although it's sure to be relevant for some students, too, as riders and endorsements often can be added to renters insurance policies as well as homeowners policies.
At any rate, Marques suggests you or your parents may want to pick the brain of your agent about additional amounts and forms of coverage that may be worth buying while you're away from home. This could involve bolstering the liability portion of a homeowners or renters policy, or it could mean purchasing an endorsement or rider that better protects certain high-value belongings that exceed the limits of a standard policy.
If you're living in a dorm or another form of on-campus student housing, you might not need renters insurance. Not if one or more parents have a homeowners policy.
This homeowners policy will have to offer "off-premise coverage" for you to benefit from its protections while at school, though, so have your parent or parents check with their insurance agent before start relying on it.
Note: your parents' homeowners policy will cover only a portion only provide of what it offers them and their possessions. For example, if the policy in question covers $100,000 of your parents' personal property, it'll probably only cover 10 percent—or $10,000--of off-premises property.
And, your parents' policy may place caps on certain items, like jewelry or electronics. It's common for those caps to cover both items that are in parents' home plus those that are elsewhere.
Given the above, you'll probably want to leave some of your more expensive items at home—or pay for an endorsement or floater to be added to the policy so it'll expand its coverage.
Many young adults "head to school armed with their laptops, tablets, flat-screen TVs, video-game systems, bikes, musical instruments, and other expensive items that can be stolen or damaged," Marques says. If you're a parent, "it’s important to … discuss with your agent or broker the equipment your child is [taking to college] to make sure you have enough coverage, or whether you need to add endorsements for any high-value items."
As soon as you move out of student housing, though, and start paying rent, you're going to have to go it alone in terms of insurance, too.
In other words, your parents' homeowners policy no longer will cover you and your stuff, so you'll need to start paying for renters insurance.
Speaking of which, if you're currently in the market for this type of insurance (or you will be soon) and you'd like to compare renters insurance quotes from a handful companies, go here.
Also, if you are or are going to be a college student, or if you know a college student (or a student-to-be), consider reading two related articles: "College Students and Car Insurance" and "College Students and Health Insurance."
A: Actually, you can—if their policy includes "off-premise" coverage and if you live in a dorm or other student housing. If you move off campus, though, or otherwise start renting an apartment or house, you'll need to purchase renters insurance.
A: No, it wouldn't. Your landlord's insurance is there to protect the structure of the building in which you're currently living. So, basically, the walls, floors, ceilings, and other related components. If you don't have renters insurance and you aren't covered by your parents' homeowners policy, you won't be covered if, say, a fire destroys your apartment and all of your stuff.
A: As long as you have or can make between $150 and about $300 per year, you should be able to afford this type of insurance pretty easily.
A: Wrong. Well, actually, in some cases you may be allowed to split a renters policy in this way, but you're likely going to want to pass on the opportunity. This kind of situation can cause all sorts of headaches that can be avoided by buying your own renters policy.
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