Graduation can be both exciting and scary as high-school seniors and parents move on to a new stage of their lives. Preparing for college, finding a job and a place to live are just a few of the tasks graduates will face this summer as they ready themselves for life after high school.
During this hectic period, families can easily overlook needed adjustments to insurance policies that cover their young adults.
“Graduation is a time to celebrate achievement and a bright future for graduates,” said Karl Newman, NW Insurance Council president. “It’s definitely not the time to find out you don’t have enough coverage, or the right coverage, if an accident happens.”
Often, a family might not need more coverage, just changes in the way coverage is set up. NW Insurance Council encourages teens and parents to call their insurance companies or agents to discuss their insurance needs after graduation day.
Here are a few scenarios that should raise a red flag for graduates and parents:
• A high school or college graduate permanently moves away from home. This creates a possible coverage problem for personal property, since a child must reside in the parent’s household for the child’s personal property to be covered under the parent’s Homeowners policy. If the graduate permanently relocates, he or she may need an inexpensive Renters Insurance policy. If the student lives in a school dorm room, however, he and his personal property are covered under his parent’s policy.
• A high school or college graduate takes a summer job as a delivery person for a pizza parlor and uses his or her own car (or one owned by parents) to make deliveries. Because many personal automobile insurance policies exclude deliveries, this creates a coverage problem for damage caused in an accident that happens while delivering pizza.
• A high school or college graduate gets involved in a volunteer program transporting young people, the homeless or the elderly from one place to another and uses his or her own car (or one owned by the parents). The parents could be liable for injuries or property damage that occurs while their son or daughter is driving.
• A graduate gets a job and starts driving a family car much more frequently. If the car is insured through the parents, this could create a need for coverage adjustment because some policy options specify that the car will not be driven to work or will only be driven a limited number of miles per day.
It’s important that families check with their insurance company or agent to understand how coverage may need to be updated. A few minutes adjusting coverage can prevent long-term headaches for you and your recent graduate.
For more information on insurance for graduates, contact NW Insurance Council at 800-664-4942.
NW Insurance Council is a nonprofit, public-education organization funded by member insurance companies serving Washington, Oregon and Idaho.