College Students Need This Insurance, Hands Down

About 20.2 million students attended a U.S. college or university in the fall of 2015 and some were without the insurance they needed.

Depending on the individual student's circumstance, students this coming year might need to buy renters insurance and forgoing a necessary policy is not a good idea. Higher education is already expensive and losing personal property or being sued could be financially devastating without renters insurance.

Most colleges and universities require undergraduate students to live in a dormitory on school property for at least one year. Those students living in a dorm are probably covered by the homeowners or renters insurance policy of their parent or guardian -- as long as they have the same permanent address.

However, some homeowners or renters insurance policies will not cover personal property in a dorm room, leaving students in a pickle.

Insurers generally don't allow students to purchase a renters insurance policy for a dorm room, even though they are, in essence, renting the room from their college or university. The good news, is that students don't have to leave their belongings uninsured. Some insurance companies offer small, separate insurance policies specifically designed to cover personal property in a dorm room.

The policies for dorms are generally pretty cheap. Even less expensive than the average annual renters insurance premium in the U.S., which is $187.

Students And Off-Campus Housing
College and university students who live in off-campus housing almost always rent a house or apartment and those who do, need to purchase renters insurance. Not getting a renters policy when needed could prove to be a serious error.

If students don't forget about renters insurance entirely, it's easy for them to try and rationalize not getting a policy. Students typically have little or no income during the school year and don't usually have many personal belongings.

There are two problems with that: Students almost always underestimate the value of their personal property and how vulnerable they are without liability coverage.

Most students have a laptop, television, furniture, clothing and jewelry or other belongings that could easily total $10,000 in value or more. To ensure they have too much or too little coverage, students should make a detailed list of their belongings. Insurance companies usually offer a number or personal property limits to accommodate renters which students can choose from.

The list will also be beneficial to have in the event a student ever needs to file a claim. Policyholders have the best chance of getting a full claim payout requested when they list specific items and values for each.

In addition to protecting their belongings, students need to protect themselves in the event they are sued or their off-campus rental unit becomes uninhabitable.

Even an unviable lawsuit against a student can still cost thousands of dollars or more. And in the event a student loses a lawsuit and is ordered to pay damages, their liability coverage will also cover those costs. Liability coverage is, arguably, the most valuable part of a renters insurance in terms of the policy's cost.

Students living off-campus might also benefit from loss of use coverage, which covers the cost of some living expenses if a rental unit becomes uninhabitable. No matter how responsible a student might be, a careless neighbor or natural disaster could force them to leave their home. In that case, a renters insurance policy will cover the cost of a hotel, meals and sometimes transportation until they can return or find a new home.