Does Your College Student Need Renters Insurance?

With pricey tuition to pay and books to buy, renters insurance isn't exactly something that most college kid's think about, but in some cases that could be a big mistake.

Students who live on campus typically don't have to worry about renters insurance: Their parents' homeowner's insurance policy should cover the loss or damage of most items as long as the policy includes so-called 'off-premise coverage.'

However, once you move off-campus and start paying rent, you are no longer covered by your parents' policy.  While renting the Landlord will typically cover the building but not the tenant's belongings.  The Landlord is not responsible for any of the tenant's damaged or stolen items. Also, if one roommate has a renters insurance policy, don't expect it to cover all the other roomates stuff, too. Most rental insurance policies only cover the belongings of the policyholder.

So what does renters insurance cover? There are three basic types of protection: personal possessions, liability and additional living expenses.

Personal possession protection covers your belongings if they are lost or damaged due to a fire, vandalism or theft among other things.

Liability protection kicks in if, say, your dog bites the neighbor, or someone slips and gets hurt while at a party at your place. It not only helps cover any medical expenses but, in some cases, can pay for your legal fees if you get sued.

Meanwhile, if you are displaced by a storm or a fire, additional living expenses coverage will typically cover the cost of a hotel, or a temporary rental until you can move back home.

The cost of renters insurance is typically pretty affordable -- on average, it costs $184 a year -- but the amount will vary depending on the location and size of the rental unit and how much coverage you need, according to the National Association of Insurance Commissioners.