Congratulations Class of 2012: Now It’s Time to Graduate to Your Own Insurance!
It’s a rite of passage for college students to don cap and gown and march for graduation ceremonies- in fact, according to the National Center for Education Statistics (NCES), nearly 1.8 million students will graduate with a bachelor's degree in 2012. As those 1.8 million make the transition from undergraduates to careers, pursuit of advanced degrees or back into mom and dad's basement, it's critical that they understand how walking across that stage may have changed their insurance needs.
While every individual’s needs are unique, here are five basic insurance coverages that all college grads should consider, to see if they apply:
A shiny new car, whether owned or leased, holds appeal for newly employed college grads. Auto insurance helps cope with the expenses of accidents, vandalism or theft. A lender or leasing company that finances the vehicle will require auto insurance. Car accidents can create large liabilities for a driver, so the liability portion of auto coverage helps protect the bank account. Plus, auto insurance covers many legal expenses if a driver is sued. If a graduate who already owns a car is moving, where they keep and register the car, especially from one state to another, can impact coverage. It's important for new graduates to let their insurance agent know about these moves to make sure their current coverage will still apply, or if they'll need a new policy.
Under the new federal health care law, children can remain on their parent's health insurance policy until age 26. With unemployment and underemployment high among those in their early twenties, this can provide many recent grads with health insurance until they are able to get it through their employer or an individual policy. Individual policies can be pricey and differ significantly in coverage, so talk with Dukes-Moore Insurance Agency about what makes the most sense.
Homeowners or renters insurance
College grads starting out may not own a home yet, but may rent a residence. To make sure their possessions are protected, homeowners and renters insurance offer comprehensive coverage whether at home or traveling. Liability insurance included in renters and homeowners coverage also helps protects against the risk of being sued. There usually are limitations on renters coverages within a group house—a typical post-graduate arrangement—so it is important to understand the details of a policy.
New grads may find a job with an employer that offers group term life insurance coverage. However, those with children may find it worthwhile to buy additional term life insurance or permanent life insurance, which builds cash value over time.
This is a vital but often-overlooked insurance coverage. It provides income when a person is injured or disabled, whether on the job or off. A Dukes-Moore Insurance Agency professional can calculate the right amount of coverage to help a person live while recovering.
New college grads may want to lean financially on their parents’ insurance coverages as long as possible (though mom and dad might feel a little differently!). While that makes sense, it’s not always viable. For instance, auto insurance companies will require an owner or lessee of a car to carry their own coverage. There are plenty of insurance policies out there that new grads won’t need, unless there are special circumstances, such as air travel insurance, contact lens insurance or cancer insurance. Typically, it is better to have comprehensive policies like renters or health.
Parents of new graduates also should take this time to review their own insurance portfolios, as there may be opportunities to reduce their premiums when child moves out of the home.
Dukes-Moore Insurance Agency can help new grads and their families navigate these waters, to provide sensible coverage that won’t break the bank.