Is your child heading off to college? Or maybe heading there next year? If they are typical of college students these days, among the things they'll bring along is a substantial haul of electronic goods, and possibly other expensive items such as sporting equipment.

It's not unheard of for a student to own a computer, a smart phone, a sound system, a television, and a digital camera. The total value of these can run into thousands of dollars. Does a separate insurance policy, separate from your homeowner’s or renter’s insurance, to cover the property they bring to campus make sense? In this article, we will look at the relevant issues and help you answer that question.

What is Covered by Homeowner’s Policies

Students living in a dorm on campus will have their personal property covered by their parent's homeowner's or renter's policy. But there are some issues to consider.

First, coverage for your child's property will typically be limited to 10% of whatever property coverage you have for your own home. So, if you have $50,000 in property coverage on your home, your son or daughter’s coverage will be limited to $5,000.

Second, the deductible on your homeowner’s or renter’s policy is likely to be $1,000 or more. That means that if a few thousand dollars’ worth of property is stolen, your recovery could be minimal (if you don't know what to do if you get robbed, consult our Has Your Home Been Robbed or Vandalized? article).

Third, what will happen to your premiums if you file a claim under your policy for a loss suffered at the college dorm? In all likelihood, they will go up.

Fourth, what if your child’s smartphone is stolen while they're off campus, like at a café? In some cases—it depends on the policy—it might not be covered unless the theft or damage happened in their dorm room.

How Does This Compare to a Dorm Policy?

College Dorm policies are different, so they're worth considering even if your property insurance affords your child some coverage.

First, you get full coverage of the value you insure the items for, not just 10%.

Second, deductibles tend to be much smaller, typically $100 or less—in some cases, quite a bit less.

Third, under most policies, your premium won't increase after you file a claim.

Fourth, coverage applies to both on- and off-campus theft or damage.

On top of all this, most dorm policies, like homeowner’s and renter’s policies, offer personal liability coverage and customized options. The latter are important if your son or daughter brings along some especially valuable item with them, like expensive jewelry or collectibles (learn more about Sublimits and Personal Property Floaters and how they affect your coverage). For an additional premium, these items can be listed separately and covered for higher amounts.

What About Off-Campus Housing?

Your son or daughter, especially after their freshman year, might be living off campus in an apartment not owned by the college, often shared with other students. In most cases, this means they won't be able to get college dorm insurance and your homeowner’s or renter’s policy will not cover them. What to do? In this case, a renter’s policy makes the most sense (for a more complete discussion of renter’s insurance, see 6 Reasons You Need Renter's Insurance).

In general, renter’s policies are significantly less expensive than homeowner’s policies because the structure (the building you live in) is not covered. What is covered is all of your personal property, personal liability, and other items, such as relocation costs in case, for example, the building burns down. Note that the policy will cover only your son or daughter’s possessions, liability, and relocation costs; it will not provide coverage for any of their housemates.

What are the Risks and Costs?

Risks vary significantly from school to school and are often similar to the risks found in the surrounding community. If your son or daughter is in a dorm in New York City, Chicago, or San Francisco, the risk of theft will almost certainly be higher—probably a lot higher—than if they will be attending college in a small Midwestern town. The premiums will reflect the risk, so they will be lower for students in low-risk locations.

Dorm insurance is usually even cheaper than renter’s insurance, which is often well under $100 a month. Some schools also have group arrangements with an insurer that allow students to buy the insurance at steeply discounted rates. When making housing arrangements with the school, be sure to ask if they have dorm insurance available for their students.

It’s Worth a Look

If your son or daughter is soon off to college, or is already there and does not have a separate policy, it’s worth looking into. Talk to the school first if they'll be staying in a dorm. If the school has nothing to offer, talk to an insurance agent—getting a quote is free (before you do, consult our 5 Questions to Ask Before Choosing an Insurance Agent). Be prepared before you call: make a list of all of your son or daughter’s possessions so you can base your decision on accurate numbers.