Auto Insurance for College Students: Should your College Bound Teen Stay on your Auto Insurance Policy?

Congratulations on your teen’s acceptance to college!  It was a long road through high school, and now that the college application season is over and done with and you know where he or she is going for the next four (or five?) years, there are some housekeeping details you need to take care of.  One of them is auto insurance.

Chances are, you added your teen to your auto insurance policy when she got a license to drive, whether she was driving her own set of wheels, or pestering you for the keys to yours.  It’s expensive to have a new driver on your policy, isn’t it?  Want to save some money now that she is going away to school?  There is a possibility you can do just that, but read on, because different insurance companies have different rules.

Some auto insurers refer to a student away at college as a “distant student” or a similar term.  Each insurer defines this its own way, so get on the phone with yours and inquire.  Typically, the expression refers to a member of your household who is away at school for a long period of time and has no access to a car until he comes home for vacations, breaks and summer.  Your college student could be eligible for a distant student discount if he meets certain criteria, such as not having access to a covered vehicle while away at school, and attending school a specific distance from home.  Some of the possible requirements for the discount are:

•    The student must be over 100 miles away. (Note that some insurers want the student to be even further away to ensure they won’t be home and driving the car every weekend);
•    The student must be under the age of 23. (Some make the age under 22 or 24; some don’t specify an age, as long as he or she is a full time student.)
•    The student must not have access to a covered vehicle while at school. (That is, a vehicle covered under your policy.  He can drive someone else’s car, but it better have insurance because he may not find coverage under your policy if anything happens.)

Some insurance carriers allow the option of taking the student off the policy completely while he’s at school. They refer to this as a “deferred driver”.  This will save you even more money.  The only problem is, with some insurers you have to remember to add him back onto the policy every time he comes home, even if it’s just for a weekend, if he is going to drive. Others will cover him for those short visits, but you have to add him back for visits of a longer duration.

Since each insurance company differs both in their terminology and their requirements, speak to your agent or directly to your insurer about your options, the savings, and your child’s and your liability should there be an accident while he is “deferred” or “distant”.  If you can envision a scenario where he might borrow someone’s car at school, as noted above, you want to make sure he is (and you are) covered should there be an accident there, as well.  Your best bet is to ask all these questions up front before you make any changes to your son or daughter’s coverage.