Last week I was wearing an NYU T-shirt at my daughter’s high school field hockey game. During half-time, a mom from the opposing team approached me and asked if I had a kid at NYU. When I told her I was a graduate, she said, “Can I ask you a question about health insurance? My daughter is going there in the fall, and the school is charging us $800 for university health insurance.”
I can tell you that the health services at NYU were free to me–my parents did pay for the coverage, and offered a range of care. Once I shared this with this parent, who was unsure how her own health insurance would translate to New York City doctors or hospitals there, she replied, “OK, now I feel better about spending that money. It seems like money well spent.”
That got me thinking about other kinds of insurance needs that college students may or may not have. So I came up with a list of 7 different insurances and tips for how they apply to a child in college.
1. Compare your health insurance coverage with the college’s. Let’s start with the biggie and one that’s on my mind, now that my daughter is a high school senior. I know that some time in the next 365 days we’re going to have to get her own health insurance card. That way if she gets sick at school and needs to go to the hospital, she has proof of insurance.
However, with the health care reform law, I don’t think we have to pay extra for university- or college-sponsored health insurance as long as we can provide proof that our daughter has health insurance through us–usually a photocopy of the insurance card that you submit to the school. What I need to figure out is if she will still be able to use the same campus health services as students who paid for insurance through the school if we opt out of using their insurance in favor of our own. You should do a similar investigation for your own college students and their health insurance needs.
2. Check out the Dental School. In my opinion there’s no need to worry about dental insurance, since dental cleanings occur twice a year. And with college schedules, chances are your child will be home twice in the year–usually six months apart–and you can squeeze in a dental appointment then. What I would suggest looking into is whether or not the university where your son or daughter is studying has a dental school. When my husband was a graduate student at the University of Michigan, he could get dirt-cheap cleanings and other dental work done at the dental school–the dental students have to practice on someone! This could be a good fallback option for having dental work taking care of on campus without having to worry about dental insurance.
3. Check for auto insurance discounts. A recent Associated Press article on insuring college kids said that your auto insurance costs could go down if your child is attending college more than 100 miles away from where you live and isn’t bringing a car to school with him or her. I’m guessing you benefit financially from this arrangement simply because your college student won’t be driving at all during the semester, and therefore isn’t at risk of a car accident or anything else that would involve auto insurance. If this scenario describes yours, be sure to touch base with your insurance company to see if you can get a discount now that the young driver is no longer using your car on a daily basis. Also, many companies offer “good student” discounts so let them know when your son or daughter makes dean’s list!
4. Read your homeowner’s insurance policy. Your homeowner’s insurance may cover the theft of or damage to any of the more expensive items that your child brings to college, such as a laptop computer or jewelry. You may also consider buying a separate renter’s insurance policy in your child’s name. These cost up to $200 per year. No matter how you handle home insurance, be sure to photograph and document what he or she takes to college so that upon returning for summer break, you know what’s still there and what may have been lost, damaged, or stolen.
5. Look into travel insurance. Ever since I witnessed a sick passenger being airlifted from a cruise ship we were on many years ago, I have been a big believer in travel insurance, sometimes known as trip insurance. While you may think of these policies as for vacations only, they make a lot of sense if your student is going abroad for a semester or traveling somehow related to his or her studies.
Some travel insurance policies cover a trip that is curtailed due to illness or an accident. Others allow you to get reimbursed if you cancel before even leaving home. You may even be able to buy this kind of insurance through the college or university. Whichever office handles study abroad is the one where you should inquire first about travel insurance.
6. Consider life insurance for your student. No one expect to lose a child, but it happens. If you, the parents, have cosigned for expensive loans or maybe you’re shouldering the weight of $50,000 a year for tuition, you need financial protection if something fatal happens. It sounds dark and disturbing to even consider taking out a life insurance policy for your child, but for about $100 a year, it could be a peace-of-mind investment.
7. Sign up for tuition refund insurance. I’d never heard of this kind of insurance until that same Associated Press article mentioned it. This insurance helps you recoup the cost of tuition, should your child get so ill that she can’t finish school, or a parent dies and he needs to leave school for family reasons. Here’s what FinAid.org, a financial aid website, had to say about tuition insurance:
Tuition refund insurance is generally not recommended for college students except when the student has a serious illness that may force the student to withdraw from school. However, tuition refund insurance plans may include a preexisting condition exclusion of 6 months to a year that can preclude coverage in such situations. Some plans will waive the preexisting condition exclusion after 6-12 months of coverage. Since most 17-20 year olds are healthy, tuition insurance is often not financially worthwhile, but does provide peace of mind.
Leah Ingram is the founder of the Suddenly Frugal blog and the author of 14 books, including Suddenly Frugal: How to Live Happier and Healthier for Less (Adams Media, 2010) and Toss, Keep, Sell: The Suddenly Frugal Guide to Clearing Out Clutter and Cashing In (Adams Media, 2010). Leah appears regularly in frugal-living segments on the “10! Show” on NBC10 in Philadelphia and is a blogger for the NBC Universal website Home Goes Strong. Recently, Leah launched a new frugal venture called Philadelphia on the Cheap. This site focuses on deals, discounts, and freebies in the Philadelphia area—where she lives with her husband, two teenage daughters, and dog. Follow her on Twitter @suddenlyfrugal
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