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Insurance Guide for High School Graduates Heading to College

Preparing your recent high school graduate for the personal and financial responsibilities of college is never an easy task. Among budgeting, books and moving your college-aged child into a dorm, it can be easy to forget to have a talk about insurance.

That talk, however, is something that will better prepare him or her for the future and perhaps even save parents a bit of money on their own policies.

"I feel the sooner we can begin teaching consumers about the importance of insurance, how it works, how to get the coverage they need while also getting the most for their insurance dollar, and how to control insurnace costs, the better," says Pennsylvania's Insurance Commissioner Teresa Miller.

As part of Pennsylvania's financial literacy intiative, the state developed Insurance 101 for high school students. The coursework is designed to make young students better consumers by showing them how auto insurance works, what different types of coverage costs, and how being a better driver can help keep them safe and lower costs.

Sounds like a good plan doesn't it? Chances are, though, your now-adult son or daughter knows very little about insurance. That's where you come in.

Here are a few suggestions from insuranceQuotes to help you get started:

Auto insurance

Parents and college students should do their homework regarding auto insurance.

First, contact your auto insurance provider before your child goes off to school, because the policy may need to be adjusted depending on the location of the college and whether a vehicle will accompany the student to school.

RELATED: How Much Does a Moving Violation Affect My Insurance Premiums?

If the student will be driving in another state, the minimum insurance requirements for that state may differ from those in the student's home state, so the policy must comply with both regions. Auto rates vary by geographic region, so the location of the college will affect what you pay.   

green carParents may be able to save money if their student won’t have access to the family car while at school. Parents of students attending school at least 100 miles from home and electing not to take a vehicle often qualify for a policy discount.

Talk to an agent if your child buys and registers his or her own car, because he or she may need a separate policy. However, some insurance companies offer discounts just for being a student, while others give discounts for maintaining good grades, such as a "B" average or better.

Home and renters insurance

Parents should review their home or renters insurance policy before a child goes off to school.

“Many policies will provide up to a specified percentage of the family's personal property limit for registered students,” says Acquenette Sims, an insurance specialist in New Jersey. However, there may be certain limitations. 

Some home or renters insurance policies won't cover a student in certain cases, such as when he or she reaches a certain age or when the student moves to off-campus housing.

In such cases, “a renters insurance policy will protect your child’s personal property against damage or loss and provide liability coverage in case someone is accidentally injured or their property is accidentally damaged while on your property,” Sims says.

Whether coverage is through a home or renters policy, students should maintain an updated inventory of their belongings. Parents also may want to buy additional coverage, known as a rider, to repair or replace expensive items such as jewelry, electronics, and computers, that typically come with limits. 

National Student Services, Inc. recommends focusing on insuring these four popular items students will have at school:

Televisions: Depending on the size and model, a stolen TV could be expensive item to replace as a student. All it takes is one “friend” to decide they either need a new TV or want to make a little extra money, and you’re out of one of your more prized possessions.

Be vigilant and protect your devices. 

Bicycles: When living on campus, transportation is essential and biking is a popular way for college students to get around. Typically, you’ll see plenty of bike racks outside of campus buildings and living areas, but they're not always completely secure.

Even on small campuses you might see someone in a hurry grab the nearest bike, even if it’s not theirs. Make sure to always lock up your bike. 

Jewelry: Loss of jewelry can be devastating, whether it’s something you purchased yourself or an irreplaceable family heirloom. Consider keeping a safe or a jewelry box that locks so you don’t skimp on security for your personal property!

Laptops: Most students will need a computer to work on assignments and group projects. So encourage your student to password protect desktop or laptops and to locks his or her room whenever possible to prevent potential theft.

Health insurance

Some schools may require students to have proof of health coverage in order to register for classes. Students typically have a number of options for health insurance, including a parent’s policy, a school-offered policy and an individual policy.

Student health plans are sold by an insurer that contracts with a college to offer coverage for students. The school can tell you about student health insurance options, but check to see if your child will be covered when classes are dismissed for the summer, says Alan N. Canton, owner of A.N. Canton Insurance Services in California. 

When Nicole Singletary of Frisco, Texas, enrolled her son Julian at Morehouse College, “we verified that all our medical and dental insurance was valid during his time in Atlanta,” Singletary says. The school also offered a plan, so the Singletarys added that one as well.

Under federal law, health insurers that cover dependents must allow children to remain on their parents’ health plan until age 26. However, if your child stays on your plan and will be out of state, find out whether your child will be using out-of-network health care providers while at school. If your coverage is through an HMO, check to see whether there's a service area near the school, the Illinois Department of Insurance says. 

If none of these options pans out, an insurance broker can help you find an affordable insurance plan. 

Life insurance

Because life insurance is designed to provide financial security for surviving beneficiaries, most single college students without dependents can go without it. However, anyone with co-signed debt, such as student loans or credit cards, should have life insurance to protect a surviving debt owner.

Life insurance rates for young policyholders are typically lower than if you wait to buy a policy when you're older and may not be as healthy. 

Editor's note: Tamara Holmes contributed to this story.

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