Auto Insurance and Students Away At Collegeby Anna Glendenning | More from this Blogger 19 Oct 2007 12:55 AM Recently a Families.com member asked me about adding a college student to personal auto insurance: My son got his driver license this summer and is now in an out of state college. He is not going to drive while at school. However, when he is back for Christmas or Summer (may be for two to three weeks), he will drive our car. Should I include him in our auto insurance? Or should I include him in our auto insurance only during the period when he is back? Some agents claimed that including him all through the year will help him in the long run. That is, when he has to get his own car and auto insurance some day, it will be cheaper for him - because "he has apparently more experience". There are several reasons I would advise that you add your college son to your insurance policy as a household member. Insurance companies base the premiums on the number of miles a person drives to and from work, or if a car is only used for pleasure. Most insurance companies will consider college students who live more then 100 miles away from home without the use of a car as a lower risk. Another important thing to consider is that most college students will be considered your dependent and parents are required to complete financial aid forms until:
Most parents continue to claim their college students on their personal income taxes until their child is earning their own living and paying their own taxes. This means that in the worst case scenario if your son were to drive and have an accident you may be the one sued for the liability of your dependent child's car accident. Children away at college may not have the use of your car, but that doesn't mean they won't be driving a friends car. The agent's advice about "experience" isn't related to driving, it's about insurance experience. Insurance companies always charge lower premiums when someone has had insurance in force for the past year. Someone who has not been insured for a long period of time will always pay a higher insurance until the company can determine what kind of risk the driver actually is. Once an insurance company has "experience" with a driver they will lower the rates. That experience will also follow the driver from one insurance company to another. Adding your son to your own policy will give him lower rates now, because your company has experience with you. When he is ready to be independent and your risk of being responsible for his liability ends, he will have prior insurance coverage and not have to purchase insurance as an unknown risk to a company and pay higher rates. The difference in cost to him later can literally amount to several hundred dollars a year for basic liability coverage. I always advise parents to name their college students on their personal auto insurance policy. Primarily, because of the liability he is for you personally as a dependent and in part because of how much more affordable insurance will be not only in the future but, right now. One way to see this difference is to ask your agent to give you a few quotes. For example ask what your son's insurance would cost if your purchased an old beater and covered it for liability only as part of your household under your policy and then ask the agent to quote the same car for your son on his own with no prior insurance.
Glossary of Insurance Terms: A | B | C | D | E | F | G | H | I | J-K | L | M | N | O | P | Q-R | S | T | U-V | W-Z Families.com Blogs are for informational purposes only. Families.com assumes no responsibility for consumer choices. Consumers are reminded that it is their responsibility to research their choices properly and speak to a certified insurance professional prior to making any decision as important as an insurance purchase. Learn more about Anna Glendenning  Anna Glendenning is a mother of four. Two biological children grown and out of college, and two siblings and adopted together in 2003. Relevantinsurance tags User Comments cheechdeez (15) 11 Nov 2007 02:16 PMWhen signing auto insurance applications, usually there is a clause stating that drivers that live in household but are away at school are excluded from the policy. Check with your auto insurance company to make sure that you do not think your children are covered under your policy when they're really not. I was able to find alot of useful tools at http://www.onlineautoinsurance.com. They have a learning center too.  Anna Glendenning (4234) 02 Jan 2008 11:30 AMThis may depend on your State or your insurance company. In my state dependant children away at college are covered as long as they are named and rated on the policy. In fact, not covering a dependent college student could place parents at risk for liability. We always advise parents to keep their college student covered until the time the child is doing their own taxes and earning an income.... But--as with many insurance issues you are ALWAYS advised to talk Directly to your agent or insurance company. Insurance is regulated by each state and varies from one state to another.  Rich Andrews (276) 07 May 2008 12:54 PMMy 16 year old is getting ready to take his test for his Learner's Permit. It really scares me to think how much insurance is going to be for him. Can he get his own insurance policy, or does he have to be on my insurance? He needs to get a job. But, I'm afraid all of his money is just going to pay for gas and insurance. adrianturcsan (5) 17 Oct 2008 07:33 AMWell, this is a very good advice for parents with children who just passed their driving tests and are about to start driving dad's or mum's car, so they don't have to pay high insurance premiums and still can build up their no claims discount. But what about with those (mostly) students who have no previous insurance experience? They have to pay over a £1000 for their first couple of years. I did a bit of research and found that apparently those insurance intermediary companies can offer you the best rates, which can select quotes from the top insurance providers. Such companies as Budget can really save you time and money, so I can recommend them for you. AgencyIQ (28) 05 Mar 2009 04:51 PMIn Texas a child has to be insured on the policy and the insurance company can add them to your policy if they discover that they are not listed. When I was a captive agent we had a lot of parents who called when their rates went up at renewal because the insurance company had added them on due to a birthday or license acquisition for the child.  Manny Pacquiao (5) 06 Aug 2009 02:59 AMThere are lots of free services online now a days. Especially for insurance terms. And you should be glad because it is very useful and can save you so much time, effort and money. There are lots of websites that can offer these free services such as http://www.freeiquotes.com , geico, online-insurance-advisor, insureme, 2insure4less, and many more.. neilboso (25) 13 Dec 2009 01:28 AMThis is a very good advice for parents with children who just passed their driving tests.Thanks for sharing. PA Auto Insurance neilboso (25) 13 Dec 2009 01:29 AMThis is a very good advice for parents with children who just passed their driving tests.Thanks for sharing. http://www.localinsuresearch.com/state/pennsylvania-auto-insurance.php Discuss this article
|
Insurance categories |
Related Blogs:
