Learn About Tenant's Insurance for College Students

Wednesday, March 19, 2014

College StudentFew parents and even fewer students think about tenant's insurance when it comes time to ship off to school. This may be a mistake since tenant's insurance can actually provide a surprisingly high level of coverage for relatively cheap, because of how few claims are made. According to Canada Home Inventory, the national average cost for tenant's insurance is only $14 per month, in which customers receive tens of thousands of dollars worth of coverage.

 

What should I look for in a policy?

There are three elements of tenant's insurance that you should be aware of when you're comparing policies, according to Laura Adams, MBA in an article for QuickandDirtyTips.com. They are:

  1. Personal Property Coverage - This covers the items that your student own and pays to replace them should something happen, like theft, fire or water damage. When you're considering personal property coverage, you'll have to calculate the value of the items your child owns. There are two options here: cash value and replacement cost. The former will cover you for the money that you would have received had you sold the item. This means that if you bought an item for $1000 three years ago, you'll receive the money that you would have gotten by selling it today - significantly less. For a slightly higher premium, you can purchase a policy that covers you for replacement cost. You might still not receive the full $1,000 in this case, but you would receive enough to buy another of the same item.

  2. Liability - most renters don't think about their potential legal liabilities, but this part of a policy is extremely important. If your student accidentally starts a fire, for example, he or she could be liable for the damages to the property. If someone were to get injured on the property, the medical costs could also fall upon your student. A good tenant's insurance product will cover this liability.

  3. Living expenses - not all tenant's insurance policies cover living expenses in the event that your child cannot live in the property as a result of a claim, but this is also an important element. For example, if water damage were to make so that your student couldn't live in the unit they rented, a tenant's insurance policy that included additional living expenses would cover him or her for the extra cost of living somewhere else in the interim.

Additional consideration

In order to make the buying and claims processes easier for tenants, The Insurance Bureau of Canada suggests that your student keep an updated list of possessions. This will help to facilitate the claims process in case something happens, meaning that your student will get their damaged possessions replaced faster. School can be a fast-paced environment, so the faster expensive items like laptops get replaced, the faster he or she can get back to studying.

It is possible that your home insurance policy provides limited coverage for possessions while your student is away at school - in this case the personal property coverage element of a tenant's insurance policy would be less important. Whether you're student is covered and for how much he or she is covered varies by insurance provider and policy, so the best thing to do is to check with your insurance representative before your child goes off to school.

The last thing that you want to deal with when your child is going off to school is a potentially stressful financial situation - especially one that can easily be avoided with a little planning. Considering the low cost of tenant's insurance, it very likely may be the best choice for your family.

Few parents and even fewer students think about tenant's insurance when it comes time to ship off to school. This may be a mistake since tenant's insurance can actually provide a surprisingly high level of coverage for relatively cheap, because of how few claims are made. According to Canada Home Inventory, the national average cost for tenant's insurance is only $14 per month, in which customers receive tens of thousands of dollars worth of coverage.

<h2>What should I look for in a policy?<h2/>
There are
three elements of tenant's insurance that you should be aware of when you're comparing policies, according to Laura Adams, MBA in an article for QuickandDirtyTips.com. They are:

  1. Personal Property Coverage - This covers the items that your student own and pays to replace them should something happen, like theft, fire or water damage. When you're considering personal property coverage, you'll have to calculate the value of the items your child owns. There are two options here: cash value and replacement cost. The former will cover you for the money that you would have received had you sold the item. This means that if you bought an item for $1000 three years ago, you'll receive the money that you would have gotten by selling it today - significantly less. For a slightly higher premium, you can purchase a policy that covers you for replacement cost. You might still not receive the full $1,000 in this case, but you would receive enough to buy another of the same item.
  2. Liability - most renters don't think about their potential legal liabilities, but this part of a policy is extremely important. If your student accidentally starts a fire, for example, he or she could be liable for the damages to the property. If someone were to get injured on the property, the medical costs could also fall upon your student. A good tenant's insurance product will cover this liability.
  3. Living expenses - not all tenant's insurance policies cover living expenses in the event that your child cannot live in the property as a result of a claim, but this is also an important element. For example, if water damage were to make so that your student couldn't live in the unit they rented, a tenant's insurance policy that included living expenses would cover him or her for the cost of living somewhere else in the interim.

<h2>Additional consideration<h2/>
In order to make the buying and claims processes easier for tenants, The Insurance Bureau of Canada suggests that your student
keep an updated list of possessions. This will help to facilitate the claims process in case something happens, meaning that your student will get their damaged possessions replaced faster. School can be a fast-paced environment, so the faster expensive items like laptops get replaced, the faster he or she can get back to studying.

It is possible that your home insurance policy provides limited coverage for possessions while your student is away at school - in this case the personal property coverage element of a tenant's insurance policy would be less important. Whether you're student is covered and for how much he or she is covered varies by insurance provider and policy, so the best thing to do is to check with your insurance representative before your child goes off to school.

The last thing that you want to deal with when your child is going off to school is a potentially stressful financial situation - especially one that can easily be avoided with a little planning. Considering the low cost of tenant's insurance, it very likely may be the best choice for your family.