Similar to homeowner's insurance, renter's insurance covers the cost of replacing your items if they are lost or stolen in a covered event, but this type of insurance can also cover your costs if you need to temporarily move to a hotel. Renter's insurance also covers liability and medical costs if someone is hurt in your home. While many college students and parents ignore or neglect this type of coverage, it can be a very wise investment. Renter's insurance is actually one of the most affordable types of insurance! Keep reading to find out if you need renter's insurance as a college student.
What you stand to lose
For most students, college is the first time you will live by yourself, with no parental supervision, living by your own rules. While this is exciting, it also means there's a bit of risk. Your roommate could forget to lock the door, leaving you vulnerable to theft. A study buddy could knock over a pot of coffee onto expensive electronics, such as your phone, laptop, or tablet during a late night study session. A party could get out of control and result in damage to your property.
Many people assume they don't have enough expensive items for insurance to be worth it, assuming it's for wealthy folk with original artwork and jewelry. The truth is, if you add up all of the items you own, you may quickly find that your new brand new computer, smart phone, portable speakers, and other items add up to quite the price tag. Having these items covered by insurance means you'll only have to pay a deductible and then file a claim to have your costs covered. It can mean the difference between replacing your brand new laptop with a notebook and pencil and being able to afford buying another one.
Some policies will even protect your insured property outside of your dorm or apartment. For example, if someone breaks into your car and steals your laptop, auto insurance doesn't usually cover this but some renters insurance policies will!
How insurance works for college students
As a college student, how insurance works will depend on whether you live on campus or off.
Living in a dorm
If you live in a dorm while at school but legally call your parents' house home, you are probably already covered through your parents' homeowners or rental insurance. Your parents' insurance agent should be able to determine if you're already covered or if you need to be added. Like all insurance, there will be limits to what is covered, so it's important to inquire about these limits and make sure you understand them. If it sounds like they're not enough, you can inquire about rental insurance specifically for college students living on campus (dorm insurance). In most cases, your covered for up to 10% of the amount on your parents' policy for their own property.
Once you move off-campus, you're no longer covered under your parents' insurance. This is when renter's insurance comes in handy. Renter's insurance covers damages to your personal property, personal liability and medical expenses, and it can also cover additional living expenses.
If someone breaks into your apartment and steals all of your electronics and other expensive items, renter's insurance can ensure you are able to replace all of these items. Or, if you have a party and someone slips and hurts themselves, renter's insurance can cover their medical bills. If someone gets hurt in your apartment and the court decides you are responsible, renter's insurance can cover the claim. If your entire building is destroyed in a fire and you're forced to live elsewhere, the right policy can cover the cost of a hotel, meaning you'll be able to continue your studies with limited interruptions.
Renter's insurance isn't a cure-all though. There are limits to what is covered and exceptions that you should understand. A good insurance agent will go over these with you and answer any questions you have.
If you have a roommate, they won't automatically be covered on your policy. You will need to make sure they're named on the policy. Any guests in your home though will be covered.
Make sure you understand your coverage and what's included and what isn't. For example, flooding won't be covered. If you decide to turn your apartment into an AirBnB, these folks aren't covered. That said, your renter's insurance can be customized to meet your needs, so if you have fine jewelry and you want it covered, you only need to let your insurance agent know.
What is not typically covered by renter's insurance: any damages caused by criminal behavior won't be covered, flooding isn't covered but renter's can buy flood insurance, and certain breeds of dogs may be excluded from your coverage. Expensive items such as artwork or jewelry are not automatically covered either but can be added on by talking to your insurance agent. If you injury yourself in your apartment, you'll need to rely on your own medical insurance.
You also need to make sure you understand what happens if you file a claim. Unless you choose otherwise, you will receive the cost value of the item stolen or lost. For example, if you originally bought your laptop for $1,900 and it's value today is only $250, you will only receive $250. If this doesn't work for you, ask your insurance agent about replacement cost insurance, but know that this will cost more.
The National Association of Insurance Commissioners reports that renters insurance costs between 15 and 30 dollars a month! What you pay will depend on your location, the size of your rental, your possessions, and other factors including your credit score and if you choose to have replacement cost insurance and etc.
Renter's insurance is one of the most affordable types of insurance but not all college students will need it. Those living in dorms are likely already covered, but students living off-campus may want to consider adding this small expense to protect all of their items in the event of an accident, human error, or other disaster.
Read more about why we think everyone should consider renter's insurance and get a quote online. There are zero obligations and we are happy to answer any questions!