College is a new milestone that comes with more responsibility. If you are a parent deciding to keep your child on your plan or a college student driving a car to school under your parents’ insurance, it is important to understand the insurance terms and how you or your child is protected. So today, we will uncover the importance of safe driving, where you drive, and the decision to stay on your parents’ plan. 

Car Insurance: Terms & Definitions

To understand how your car insurance protects you, it is vital to know what premiums, deductibles, and policies are, as well as the types of car insurance coverage that college students should have.

• Premium – The price you pay to an insurance company in exchange for coverage of your car and yourself.
  • The cost of the premium can be higher for college students, as they are more inexperienced and have higher chances of automobile accidents.
• Policy – The plan itself that offers several types of coverages for automobile situations.
• Claim – Is what you “file” by calling your car insurance company, letting them know you will need to use your policy to cover accident damages. This allows the insurance company to help pay for a portion of the damage.
• Deductible – The money you pay before the insurance company covers the rest of your claim. Deductibles are usually chosen at the time of choosing a policy.
  • For example, if your deductible is $500, and the cost to repair your car is $2000, you pay the $500 upfront before the insurance company pays for the remaining $1500.
• Coverage – Is what protects you and your car from damage, ranging from liability, uninsured/underinsured, comprehensive, collision, and personal injury protection.

How to Decide to Stay or Leave a Parent’s Policy

This decision is on a case-by-case basis. Overall, the cheapest option is to stay on your parents’ plan. But this might not be the most convenient given your new location. If you move to a rural area, policy rates might be cheaper compared to a metropolitan area. Also, if your parents do not have the best driving record, getting your own might lower policy costs if you are a safe driver. The best way to decide is by getting car insurance quotes from agencies, as there may be discounts for college students. 

Ready to start exploring insurance policies? Check out our blog on debunking myths on auto insurance to help you choose the right plan! Also, be sure to check out our blog, What Affects the Cost of Your Car Insurance Premiums?, for more information. At Safeside, we are committed to providing quality service to suit everyone for their long-term protection and well-being. Learn more about us and contact us today to get started!