3 Important Tips for Insuring Your College-Bound Student

This article is sponsored by Anderson Insurance Agency.

Many 18- and 19-year-olds in our community are saying goodbye to high school and preparing for their next steps in the adult world, often in new locations away from home as they pursue college or other new endeavors. This transition can bring with it important questions about less glamorous topics.

For instance, are kids still under their parents’ insurance? All of it? Who is responsible for medical bills if a young man or woman gets hurt in an accident? What if they cause an accident of some kind?

universityThese kinds of questions aren’t necessarily fun to sort out, but answers to them are necessary to ensure a smooth transition.

As a mom of a 20- and 17-year-old, Ann Anderson of Anderson Insurance Agency understands that life can get complicated through this transition. She's passionate about helping parents navigate these late teen and early adult years. Anderson mentions,

Even when kids turn 18 while they're still in high-school, they're considered adults at that point. How do you make that transition?

According to Anderson, moving away to college only adds to the complexity. She advises parents to think about questions like, ‘What if my kids get sick or injured while away at college. What about liability?’

Anderson lists three areas that parents should particularly examine as their teens get ready to leave home for college in order to ensure a smooth transition, peace of mind, and financial security.

Power of Attorney

young adultEspecially in an era in which information, and particularly medical information, is so carefully protected, a parent’s power of attorney can make the difference in a frightening or uncertain situation.

Without powers of attorney, parents of young adult children often have their hands completely tied over financial or medical issues. Hospitals can’t release information if someone is injured. Anderson shares,

Even if a parent is paying the tuition, a college financial office can’t tell them anything about a student’s bills or payments without the student’s formal permission. Obviously, it’s important to consult an attorney and figure out exactly what exact paperwork needs to be signed and what powers of attorney might be helpful in an individual situation.

Anderson encourages parents to particularly ask an attorney about how to go about ensuring that parents have medical powers of attorney, decision-making rights, and information releases that they may need to help support their adult children while away from home.

Renters’ Insurance

The second key item that parents and young adults need to discuss with their agent is renter’s insurance. Anderson says,

When children are away from home, most insurance policies consider young adult children as still part of a given household. This can be good, but it means that the deductible of the household applies to their items at school.

Anderson goes on to explain that a renters insurance policy can lower the general deductible and protect against theft, fire, water, etc. It can also protect against accidents that kids cause through negligence. Anderson urges,

Sit down with your agent and just talk about your situation and potential issues. If your kid gets hurt being negligent, there can be insurance issues. If they cause damage, parents can be liable. A good agent can tell you how to protect yourself and your child. Particularly ask whether your umbrella insurance extends to your child’s dorm room.

Life Insurance

There's a final, larger issue that Anderson is particularly passionate about.

It’s such an uncomfortable thing to talk about and no one wants to think about worst-case scenarios, but I feel really passionate about this.

Life insurance, Anderson explains, is actually a product that Farmers provides for children as young as a few weeks old. Anderson says,

If a child is less than 10 years old, the premium can be less than $20 a month. This potentially could be their life insurance policy for their entire life. Later, Farmers can create policies that grow inside the original policy, but the premiums are frozen.

Anderson points out that this can be especially useful if for some reason something unfortunate happens that prevents children from being able to get life insurance later on as adults.

college studentThe cash inside the policies can also grow, tax-free, Anderson points out, and act as a sort of protected savings account. Anderson concludes passionately,

We plan for so many things as parents. We plan for soccer club and prom and getting into the best colleges. Shouldn’t we be willing to set aside $25 a month to ensure that they're set up for life?

If you aren’t sure where to turn for some of the answers to the questions raised by Anderson’s advice, set up an appointment with Anderson Insurance Agency to get some real answers and clear direction.

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