Is your kid all grown up and studying in college? Seeing your child move out of your house and into a dorm is a busy and emotional time. You’ve got a lot to think about, but there might be one thing you’ve forgotten to handle – updating the auto insurance policy.
What you need to do depends on the specifics of your situation. Here are two common scenarios.
Scenario One: They Take the Car with Them
If your kid is taking the car to college, you should contact your insurer to determine whether or not you’ll need a new policy to cover it. Keeping the car on the parents’ policy may be possible – and it’s often less expensive – but several factors will need to be considered:
- Who owns the car – the parents or the student?
- What is the student’s permanent address? In many cases, full-time college students continue to use their parents’ address as their legal permanent residence, especially if they’re only staying in the dorms for part of the year.
- Is the student studying in the same state or in a different state? Keep in mind that different states have different car insurance laws, including the minimum liability insurance requirements.
Either way, you’ll need to let your insurer know that the car will be parked in a new location.
Scenario Two: They Leave the Car Behind
College students who live on campus don’t always have much use for a car. In some cases, it might be easier to leave it behind.
In this case, you may be tempted to take your child off your car insurance policy. Doing so could lower your rates. Don’t rush into a decision, however. There are several important issues to consider.
- First, if the student will be visiting regularly – for summer break, and possibly for winter and spring breaks as well as the occasional long weekend or emergency laundry session – it seems likely that they’ll want to use the car. If so, keeping them on the policy is important for ensuring coverage.
- Coverage may also benefit them in other situations, such as by providing secondary coverage if they’re borrowing a friend’s car.
- If the parents’ house is considered the student’s legal permanent address, it might not be possible to exclude the student for a short period. In this case, it might be necessary to keep the student on the insurance policy.
- Finally, keeping the student on the policy might not cost as much as you’d expect. Many college students qualify for student discounts.
As always, it is important to notify your auto insurer of the change. Together, you can discuss the best course of action. It’s also a good time to get a new auto insurance quote and to ask about discounts you may have overlooked before.