Choosing any insurance can be intimidating due to the number of options and types available. What is it for? What are its protections? In what instance is it needed? Regardless, it is essential for college students to understand the need for it and how insurance can protect them and their assets.
Two Kent State University professors with expertise in insurance gave Kent State Today readers advice on how to navigate the world of insurance with a focus on students.
Auto Insurance
One of the most important types of insurance all individuals should have is auto insurance, as it is not only a legal requirement, but it is also crucial for anyone behind the wheel.
Each state has different requirements for liability coverage, which is the mandatory insurance you are required to possess for incidents involving others, but Ohio’s minimum limits range from $25,000 to $50,000, depending on the type of coverage—property damage or bodily injury liability.
Linda Ruse, assistant professor at Kent State University at Salem and program coordinator for the insurance studies major, said these limits are the minimum. She suggested students investigate higher limits due to the cost of cars, to better insulate your liability. She encourages students to visit the Ohio Department of Insurance website, which outlines all requirements and how coverage works.
Shawn Rohlin, Ph.D., director of the Center of Entrepreneurship and Business Innovation in the Ambassador Crawford College of Business and Entrepreneurship, details two of the most common types of auto insurance, comprehensive and collision.
Rohlin, who was most recently featured in an article from WalletHub, said comprehensive insurance covers aspects that are usually not within your control, like theft or natural disasters. Collision insurance is best suited for covering your own repairs.
“If you are driving a car that is not expensive, then that cost is very little because generally you have a deductible,” Rohlin said. Essentially, a deductible is the amount you must pay out of your own pocket before an insurance company assists.
There is also another type of coverage Ruse suggested students look into, which is uninsured motorist.
“If you are driving your car and you are hit by someone who is at fault, and they do not have liability coverage and you carry uninsured motorist coverage, it will pay you what their policy would have paid you for your bodily injury claim,” Ruse said. She added that you can also purchase uninsured motorist coverage in Ohio for your vehicle damage.
Health Insurance
Students, did you know you may be entitled to stay on your parents' health insurance plan until the age of 26?
“I think that’s great because it is typically much cheaper,” Rohlin said. “But usually when you must start incurring your own health insurance and usually people get it through their job.”
Health insurance is essential, and Rohlin said college students are a part of the groups that are the most uninsured. But he points out that attaining this type of coverage is relatively easy.
“The health insurance industry knows that college students are pretty healthy, so typically it is not that expensive to insure someone who is young,” Rohlin said.
To research health insurance policies, Ruse suggested students look to the Health Insurance Marketplace for more information.
Renters Insurance
Many students live in apartments or houses that they rent. Ruse said a renter’s policy can cover personal possessions in the event of a fire or other covered perils. A renter’s insurance policy also provides liability coverage if a guest is injured at your apartment or if your dog bites someone.
Another type of insurance that Ruse said students should consider is inland marine coverage.
“It is a special coverage for some of your valuable property,” Ruse said. “If you have an inland marine policy, you put a piece of property on it, like your computer, and it covers you for just about anything that happens to that piece of property.”
Insurance is essential because it provides you with the security you may need at some point during your life.
Ruse recommended resources that will guide you on checking different policies, like The Zebra or NerdWallet, to compare rates.
With students being first-time buyers, some things can affect the process of getting insurance.
For example, having a poor credit score, lapses in coverage, or violations such as a DUI could possibly lead to rejection of an insurance policy.
“You might be referred to a high-risk insurance company if that happens,” Ruse said.
Ultimately, both Rohlin and Ruse emphasized that insurance is all about managing risk. If you take the time to research the right coverages and secure a policy, you are setting yourself up for success by protecting yourself and your assets for the future.
Learn more about the John S. and Marlene J. Brinzo Center for Entrepreneurship.