Insuring Your College Student's Auto: What You Need To Know

Car insurance for college students can be expensive, with student-aged drivers between the ages of 16 and 25 deemed high risk by insurance companies. However, there are ways to reduce costs, such as staying on a parent's policy, taking advantage of insurance discounts for younger drivers, or limiting driving mileage. If a student has their own car and is the only person listed on the title, they will likely need a separate policy, which is typically more costly. Out-of-state college students may face additional requirements or restrictions when it comes to insurance, and it's essential to consider factors like the location of the vehicle, age, and driving frequency when determining insurance options.

Staying on a parent's policy

If your child is a full-time student, it's usually cheaper to keep them on your car insurance policy than to insure them separately. This is often the best option, especially if you have multiple cars or drivers in your household. By keeping your college-going child on your insurance policy, you can take advantage of various discounts, such as good student discounts, which can significantly reduce the cost of coverage. Maintaining continuous coverage for your child is essential, as it can help them build a positive insurance history and lead to lower rates in the future. This option is also convenient, as you won't need to worry about managing multiple policies and billing statements.

There are a few things to keep in mind, though. Firstly, you should ensure that your insurance company is aware of your child's accurate garaging address. This is crucial because rates can vary depending on where your child's car is primarily kept and used. Secondly, if your child attends college out of state, you must ensure that your insurance company is licensed to provide coverage in that state. Most national insurance companies won't have an issue covering your child in another state, but it's always good to confirm.

Another factor to consider is usage. If your child is not taking a car to college and will only drive occasionally when they are home, you may be able to get a discount for low mileage or limited use. Discussing these options with your insurance agent can help you find the right balance between coverage and cost. It's also a good idea to review your policy limits and consider increasing them if your child will be driving in an area with a higher risk of accidents or claims. This can provide added peace of mind and financial protection.

Remember that insurance companies consider students under 25 to be high-risk drivers, which can result in higher premiums. By keeping your child on your policy, you can often mitigate this risk and secure better rates. Staying on a parent's policy is generally the most cost-effective option for college students, and it ensures that they have the necessary coverage while allowing them to build a positive insurance history. Finally, don't forget to explore various discounts, such as good student, distant student, and driver's education discounts, which can further reduce the cost of coverage.

Getting a separate policy

Permanent Address and Residence

If your child has moved out of your home and established their own permanent residence, they will likely need to obtain their own car insurance policy. This is because insurance companies typically require that the primary address on the policy matches the address where the car is usually kept overnight. In such cases, your child will need to provide their new permanent address and update their driver's license and vehicle registration accordingly.

Cost Implications

Obtaining a separate policy for your college student can have cost implications. While it may increase the overall cost of insurance for your family, it is important to weigh this against the potential savings on your existing policy if your child is removed. Additionally, your child may be able to find a more affordable policy with a different insurance provider or take advantage of discounts specifically for students.

Insurance Coverage History

Maintaining continuous insurance coverage is important for building a positive history, which can help reduce premiums in the future. If your child has been listed on your policy for some time, removing them and starting a separate policy may disrupt this continuity. On the other hand, if your child is a new driver, starting their own policy can help them establish their own insurance history.

Insurance Rates and Zip Codes

Insurance rates can vary depending on the zip code where the car is located. If your child's college is in a lower-rate zip code, obtaining a separate policy may result in more affordable rates for them. However, it is important to compare rates between different providers to make an informed decision.

Student-Specific Discounts

Many insurance companies offer student-specific discounts that can help offset the cost of a separate policy. Good student discounts are commonly available for students who maintain a certain grade point average (usually a B average or higher). Additionally, some insurers offer distant student discounts if the college is located a certain distance away from home, typically more than 100 miles.

Ownership of the Vehicle

If your child is the sole owner of the vehicle, they will likely need to obtain their own insurance policy. In cases where you are a co-owner or have a financial interest in the car, it may be more advantageous to keep your child on your policy or include them as a named driver. Consult with your insurance provider to understand their specific requirements and recommendations.

Discounts for students

Students can avail of several discounts when it comes to auto insurance. Firstly, staying on a parent's policy can be a good way to reduce costs. This is possible even if the student goes to college out of state, as long as the parent is listed on the title of the car. However, if the student owns the car and is the only person listed, a separate policy will likely be needed, which is usually more expensive.

If a student plans to live at home while studying, they can remain on their parent's policy if they don't own the vehicle they'll be driving. If they will be living on campus or renting, they should check with the insurance company to see if they need separate coverage. Even if a car isn't being taken to college, it's a good idea to stay on a parent's policy to be covered during breaks. Parents may even get a discount if the student keeps their car at home while they're away.

There are also discounts available for students with good grades, known as 'good student discounts'. GEICO, Progressive, and State Farm all offer these, with GEICO and Progressive requiring a "B" average or better, and State Farm offering a discount of up to 25% for students in the top 20% of certain national standardized tests.

A 'distant student discount' is also available from Progressive for those aged 22 or younger who attend a school that is 100 miles or more from home and don't have a car there.

Students under 21 can also get a 'driver training discount' if they take a course in safe driving or driver education.

Other discounts include the 'resident student discount', where parents can get a discount if their child is away at school but keeps their car at home and remains on the parent's policy. There's also the 'multiple policy discount', where insurance companies offer reduced rates for those who purchase more than one policy, such as an auto policy and renters insurance.

Additionally, some insurance companies offer discounts to members of certain fraternities, sororities, honor societies, or other student organizations.

International student insurance

International students in the U.S. can usually drive with a valid driver's license from their home country and an International Driving Permit (IDP). An IDP translates your driver's license information into 10 different languages, but it is not a replacement for your license. You must carry both to legally drive in the U.S.

International students are often charged more for auto insurance policies because they usually do not have a driving history recorded with a U.S. agency. The cost of car insurance for international students is, on average, $393 per month. However, after three years of driving in the U.S., international student auto insurance costs will drop.

If you are an international student, the first place you should check when seeking car insurance is your university's international student association. The international students' organization will likely provide you with a list of companies that offer coverage for international students. These companies are familiar with your situation and will be able to set you up with a policy quickly.

The exact coverage you need for your auto insurance policy depends on where you live. Different states have different minimum coverage requirements. Most states require bodily injury liability and property damage liability. Some also require uninsured/underinsured motorist coverage and personal injury protection. If you are leasing your car or paying off a loan, you may be required to purchase collision coverage and comprehensive coverage.

As a college student in the U.S., you may be eligible for a good student discount from some of the largest car insurance companies. Many companies also offer distant student discounts for drivers who are away from home and, therefore, not driving as frequently.

Primary address considerations

When it comes to primary address considerations for college students and their auto insurance, there are several factors to take into account. Firstly, it's important to understand that a college dorm or student housing is not considered a permanent residence. In the eyes of insurance companies, students living in such accommodations are still considered residents of their parents' homes and should remain on their parents' or guardians' policies. This means that if your student will be living in a dorm or student housing, their primary address will be your home address, and they can stay on your insurance policy.

However, if your student will be living off-campus in their own place for more than six months of the year, they will likely need their own insurance policy with their new address as the primary residence. This is because insurance companies view the primary residence as where an individual lives when they are not in school. If your student has their own vehicle, they will be required to get their own insurance policy and list their new address as the primary residence.

In cases where you and your student are both listed on the vehicle's title, they have the option to either remain on your policy as a driver with a different garaging address or obtain a separate policy with you listed as a co-owner and the appropriate garaging address.

It's worth noting that some states and insurers may require out-of-state college students to have their own separate car insurance policies. Therefore, it's essential to clarify with your insurer whether your student needs their own policy based on factors such as the vehicle's location, the ZIP code, and whether they are living on or off-campus.

Additionally, if your student is not taking a car to college and will only be driving when they are at home, they should remain on your insurance policy. This ensures they are covered when driving your vehicles during school breaks.

Frequently asked questions