Student Auto Insurance Savings

Parent Cafe
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<p>Saw this article in WSJ – interesting guidance on potential ways to save money on car insurance for students away at school.</p>

<p>Section from Article: Premium Opportunities By ALEKSANDRA TODOROVA </p>

<p>Reviewing your various insurance policies will not only protect your child at school—it may help you save some cash, too. Here are few strategies to consider:</p>

<p>Claim Savings on Auto Policy
Your auto-insurance premium likely doubled—or even tripled—when your teenager first got a driver’s license. Now that he or she is heading to college, you can get some relief. As long as the campus is at least 100 miles away and the car stays at home, you should qualify for a discount on your premium, says Robert Hartwig, president of the Insurance Information Institute, an industry group based in New York.</p>

<p>Just how much will depend on how far your premiums went up in the first place: Parents usually get bigger savings for their sons than for their daughters because premiums for sons are higher, says Robert Hunter, director of insurance at Consumer Federation of America, an advocacy group in Washington, D.C.</p>

<p>If your child takes a car to campus, you can either keep him or her on your policy or have him or her purchase separate insurance.</p>

<p>The latter will allow the student to start establishing a driving record, but it likely will be more expensive than staying on a parents’ policy because any discounts—such as those for having multiple cars on the policy—will be lost. In Indianapolis, for example, it would cost roughly $400 more annually for a student to have a separate policy, than to remain on a parents’ policy, according to State Farm Insurance.</p>

<p>Either way, don’t be shy about touting your child’s grades to your insurer. Most companies offer “good student” discounts. For instance, State Farm takes 9% to 35% off a premium, depending on the student’s gender and whether he or she is kept on the policy as an occasional driver or is at school.</p>

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<p>Interesting about gender!</p>

<p>Neither S had a car in college, so they went off our insurance. They were put back on when they came home. It saved us quite a bit of money. Our insurer never inquired about their grades.</p>

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<p>One thing to think about removing them versus getting away student status is that if they drive a friend’s car and get into an accident, your insurance will kick in if the car has no insurance or is under insured with the away status.</p>

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<p>One other thing to think about–if your kid does get a car is whether to get them their own insurance + umbrella coverage if they may in the near future have significant earnings. We are having S purchase his own insurance + renter’s & umbrella policy, just because he’s in CA & there are way too many accidents & lawsuits there. One multi-car accident can really run up bills & I have noticed that when the insurance policies are higher, they DO hire better attorneys to defend the cases.</p>

<p>By the way, they DO give discounts if you buy all the policies (auto, umbrella & renter’s) with the same company (tho his is a CA company, not the company we have our auto policy with in HI). The amount S is paying for his 3 policies is lower than the amount they wanted to increase our policy for adding him as a driver with his own car out-of-state. They did give him a good student discount & also had a slightly lower rate because he has had his license so many years (tho he hasn’t really logged all that much mileage–mostly his license has gathered dust).</p>

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<p>My daughter, who is a college junior, is covered under the away status, which means that she can drive a friend’s car or drive one of our cars at home during breaks without any problem.</p>

<p>My son, who is a graduate student, is no longer on our family’s insurance and has not obtained insurance of his own because he does not own a car. The only cars he ever drives are those from the car-sharing service (Zipcar), which come with insurance.</p>

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<p>Wish there were more care-sharing services that had their own insurance. That is certainly an idea that makes sense, especially in a city that requires cars to navigate, like LA. Actually was hoping S would not need a car, but it really appears that he does. :(</p>

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<p>Taking them off and putting them back on was not an option. I tried that, and the insurance company said as long as she was still maintaining her driver’s license at the home address I had to cover her or lose her when she came home on holidays, etc. Away student worked for us best.</p>

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<p>I know I am from Canada and that insurance is different but we use allstate and when my D (18 years old) bought her car this spring I asked was it cheaper to put the car in my name and have her as principal driver or to put it in her name. The answer was to put it in her name and that way if she does have an accident it will have no effect on my policy. Then came the question of how much is this going to cost and again I was shocked. My agent told me that since my wife and I both have over 35 years of driving without making a claim that she would get the same discounts we get plus one no fault accident claim. This must be a Canadian policy but I am sure happy with it. She has brought her car (99 pontiac sunfire) to the States for college and we made sure that she is properly covered and the total cost of insurance is $750.00CDN per year.</p>

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<p>S2 is now also living away from home and has signed up for zipcar. We, too, use zipcar nowadays as S1, who needs a car for work (we don’t) has inherited our (not quite) clunker.</p>