09/06/2023
Here is some useful information if you have a child attending college!
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The Insurance Services Office homeowner's insurance policy HO-3 form, HO 00 03 03 22, provides coverage for children who are away attending college full-time (as defined by the college) and who are under the age of 24. Insurance companies consider full-time college students to be children who are residents of their parent's home who are temporarily residing away at school. Therefore, these students are provided with coverage under their parent's homeowner's policy. The policy will provide coverage for personal property, personal liability, and medical payments.
Regarding coverage for personal property, the policy will provide insurance coverage for the personal belongings of college students when they are living in dorms. Most homeowner's policies limit the amount of coverage for off-premises personal property to 10% of the total coverage available for personal property under the policy. Therefore, for example, if a policy provides $40,000 in total coverage for personal property, the total amount of coverage available to cover the personal property in a student's dorm room would be $4,000. Since many students take expensive belongings with them when they go away to college, the parents need to consider whether the amount of coverage that they have is adequate or if they may need to increase it or change it in any way.
The typical homeowner's policy form also provides personal liability insurance coverage for the student under their parent's policy. This will provide coverage for the student for legal defense costs or coverage for an accident that causes bodily injury or property damage. The coverage does not apply to accidents resulting from automobiles, boats, or aircraft. The typical homeowner's form will also provide coverage to the student living away at college for the medical expenses of others resulting from injuries that occur while they are at the student's dwelling.
The HO-3 form provides limited coverage for damage to property that is in the student's care, custody, and control. The form states that the insurance does not apply to property damage to property rented to, occupied by, or used by, or in the care of the insured. Accordingly, if damage occurs to the student's dorm room, the HO-3 would not provide coverage.
It is very common for college students to move into off-campus housing and not live in the school's dorms. This living arrangement may be treated differently by insurance companies than the full-time student who lives in the dorms that are provided by the college. Students who live in off-campus housing may need to obtain their own rental insurance policies, since their parent's homeowner's policies may not cover their personal property that is located there. In this situation, all of the details of the rental need to be explored in order to ensure that the student is adequately insured. This will include such items as the size and location of the apartment, any roommates that they may have, the contents of the apartment and whether the student will return home or reside in the apartment after the school year ends. The agency can check with the parent's insurer to find out if there would be coverage for the student living off-campus under the parent's policy, or if a separate insurance policy should be obtained to provide coverage.
Another issue to discuss with a customer who has a child away at college is the car that they may have been driving when they were living at home. Does the parent own the car or is it in the student's name? If the student does not take a car with them to college, and they are insured under their parent's policy, it may not be prudent to take them off the policy to reduce costs. This way the student will be covered if they are going to be using the car when they are home from school or if they drive a friend's car while they are away. If the car is in the student's name and it is not taken to college, some insurers will provide a discount if the car remains at home and is over 100 miles away from the college. If, however, a car is taken to college by the student, the auto insurance company should be notified about the location where the car will be garaged, whether it is titled in the name of the parents or the student. The location where the car is garaged may either increase or decrease the auto insurance premiums. Another issue to consider is that if the student is regularly allowed to use a car owned by someone else while they are away at college, they would not be covered under their parent's auto policy for an accident that occurs while they are driving that car. There would be coverage under the policy maintained by the car owner, but there would be no excess coverage available under their own parent's policy. ISO offers an endorsement, PP 03 06 09 18, Extended Non-Owned Coverage – Vehicles Furnished or available for Regular Use, that would add excess coverage for a student who has access to a car. The parents of a student away at college may want to consider adding this coverage to their insurance.
