The Four Kinds of Insurance You Should Consider for Your College Student

by Michelle Smoley, former Assistant Vice President at Chase Student Loans When I was a college student, I was clueless about insurance. All I knew was that I had to get good grades in order to qualify for the good student discount on our family’s auto insurance. My parents and I struck a deal: they would pay for my car insurance as long as I qualified for the discounted rate. If my grades fell, so would my bank account balance and my spending money. My parents explained that insurance was a necessity. My mom was a nurse and knew firsthand how expensive medical bills could be; Dad was a farmer and in order to manage his risk, he always carried hail insurance on the crops. Insurance is a means to protect oneself and mitigate risk from loss of income or assets. It makes sense that parents understand the value of insurance, but what about college students? College students may not realize it, but they are exposed to risks every day. Theft, fires, illness, and accidents can occur in the blink of an eye. There are various types of insurance available to students. While college students may not be too concerned about protecting income now they should consider protecting their assets. Today’s automobiles, technology, and student belongings are worth significantly more than what their parents had. Here are some types of insurance that college students might want to consider:

1. Health insurance: Most colleges require students to have health insurance and will provide it for a fee. If students are covered by their parents’ policy, they can provide documentation of existing coverage to the college and have the fee waived.
2. Rental insurance: College students typically live on-campus in the dorms or off-campus in a house or apartment. A rental insurance policy can cover the loss of personal belongings due to fire or theft. Rental policies are very inexpensive and many property owners will require that you have one in place before you move in.
3. Automobile insurance: Accidents happen. According to www.insurance.com, the average college student will pay $1,000 more per year than the national average for car insurance. However, college students who maintain good grades (like I did) may be eligible for discounts up to age 23.
4. Life insurance: Parents may want to consider purchasing a life insurance policy for their student if they are co-signing or borrowing private education loans. Unlike federal student and parent loans, private education loans are not discharged upon death. An inexpensive term life insurance policy might be in order.

College students are exposed to risks daily. The kinds of insurance protection described above can help mitigate the financial impacts of these risks.