My son (daughter) is leaving home to attend college this fall. Will my auto and homeowners insurance policies cover him (her) while at college?
This is a great question I get from time to time.
When college students move from home to their home-away-from-home - a rented dorm or apartment – insurance issues can arise and should be addressed before they leave home.
One key question that arises in discussing these issues is whether the student is still considered a resident of your household. This is a legal question, but your homeowners and auto policies both contain provisions that apply the broadest coverage available in those policies to persons who are legally considered residents of your household.
It is generally accepted that students living away from home while attending college are residents of their parents' household. Based on previous Texas court decisions, the real test is whether the absence of a person from the household is intended to be permanent or only temporary - whether there is physical absence coupled with intent not to return. This leaves a great deal of room for interpretation. There may be borderline cases that require you to think about alternatives. For example, it may be difficult to consider a 23-year-old graduate student living in an apartment year-round to be a resident of your household.
Your homeowners policy covers personal property owned or used by a resident of your household while the property is located anywhere in the world.
However, most policies limit the amount of coverage on personal property to 10 percent of the amount shown on the policy for personal property, when the property is located at another residence away from the home address.
Look at your policy and find the limit provided for personal property. Take 10 percent of that amount, and then think about the items your student has taken to college: clothes, TV, computer, other electronics, furniture, and household items. How much would it cost to replace all those items if they were all lost at the same time in a fire or other catastrophe?
In addition to the dollar limitation, some policies don't cover theft of personal property from the student's residence, except while the student is temporarily living there. This is a definite problem, especially when the apartment is owned, or rented for a 12-month term, and the student comes home for the summer.
Your homeowners policy also provides liability coverage in case a family member is legally liable for another person's injury or damage to another person's property. This coverage clearly applies to accidents at home or away from home, but some policies limit the coverage when an accident occurs at an owned or rented residence other than the family home. Some insurance companies offer liability coverage at separate residences for an additional cost.
After all of the above information is considered, it's easy to see there are potential coverage gaps in your homeowners policy when a student leaves home for college. That's why we recommend that you purchase a separate tenant or renter's homeowners policy for the student's residence, whether it is an apartment or a dorm room. The cost of such a policy is small compared to the benefits it provides.
If your student takes one of your family vehicles to college, the coverage provided by your family automobile policy follows the vehicle anywhere in the United States and Canada. This includes coverage for damage to the vehicle itself (if you have purchased such coverage on that vehicle) as well as liability coverage for injury or damage to other persons or property.
If your student doesn't take a vehicle to college, some coverage under your policy may still apply if they are riding in or even driving a vehicle belonging to someone else.
Students Who Are Not Legal Residents of Your Household
Coverage complications can arise on your homeowners or auto policy if your student for whatever reason is not considered a legal resident of your household, as was mentioned in the first part of this article. We encourage you to discuss your personal situation with us and your attorney. To be safe, we will likely recommend separate homeowners and auto policies for the student if they are not considered a legal resident of your household.