Insurance- Auto & Renters

In the last post I introduced the importance of college students having three types of insurance: health, auto, and renter’s, and I elaborated on the basics of health insurance. Next, here’s what you need to know about auto and renter’s insurance:

Auto Insurance
Automobile insurance covers repair bills and protects you from having to pay costly medical bills for yourself or others following a car accident. It also can protect against the costs of car damage resulting from acts of nature or in cases where another driver hits you and does not carry sufficient insurance to cover your medical and repair bills.

A full coverage auto policy includes the components of collision, damages caused by nature, fire, or theft or vandalism, and liability insurance. Liability insurance covers payments for bodily injury or property damage you are found legally liable for. When a dealer or bank is financing your car loan, a full coverage policy will likely be required. Also, almost every state requires you to carry a minimum amount of liability coverage.

It’s important to compare insurance companies before buying a policy to save money. Some companies offer good student discounts for maintaining a high GPA, and others grant discounts for having safe driving records and taking driver’s education classes. Unfortunately, car insurance is typically more expensive for drivers under 25 due to inexperience. Finally, keep in mind that choosing a higher deductible can lower your premium cost.

Renter’s Insurance
Renter’s insurance provides coverage for belongings within a rental property. The policy protects against losses to personal property within the rented space for the following situations:

  • Loss of personal items to theft or vandalism
  • Loss of personal items to fire, smoke, leaking water, and other acts of nature
  • Liability claims filed against you by someone who is hurt on the property and accuses you of negligence
  • Medical expenses of someone who is hurt in your rental unit

You first need to do some research to check and see if you need a new renter’s policy. You could possibly be covered under your parents’ homeowners policy. Your insurance needs depend on the total value of your property, and most policies require you have at least $10,000 of protection. Premiums are usually pretty reasonable- typically under $200 a year.

The bottom line is that no matter how cautious you are, accidents are still a possibility in life. Insurance is the only way to protect yourself against having to pay for these expensive incidents out of pocket.

Post written by Amanda Owens, SMMC Program Assistant