Insurance Primer for Recent Grads
College graduation took forever, didn’t it? First you waited through years and years of school, and then hours and hours through the commencement ceremony. But you made it. You’re a college graduate about to take on the world!
It’s exciting, but it can also seem a bit overwhelming. There’s so much you don’t know, and it probably seems like everyone else has it all figured out. If they do, it’s because they had help. Someone gave them information and told them what to do. We may not be able to help you with all of life’s challenges, but we can help you with your insurance! Here are a few things every new grad needs to know about insurance.
Get Renters Insurance
If you’re not living at home with your parents, you need a good renter’s insurance policy. Some landlords will require it, but there are better reasons than that to make sure you don’t procrastinate or skimp on it. If your apartment is broken into, lightning hits the roof, or a pipe breaks and floods, your landlord’s insurance isn’t going to replace your stuff. That’s your job.
Before you think you don’t have enough stuff to warrant renter’s insurance, do a little math. Add up the cost to replace your computer, phone, tablet, television, game system, your furniture, clothes, and anything else in your home. It’s a lot more than you realized, right? Renter’s insurance can help you pay to replace your stuff.
When you buy renter’s insurance, want to get a policy that offers replacement cost coverage. This means you’ll get the amount it will cost to replace your stuff. If you pick “actual value,” you’ll receive a lot less. Keep a record/inventory of your stuff by taking pictures or video and storing them in the cloud so you can show it to your insurance agent if you need to file a claim.
Don’t Skimp on Auto Insurance
Your parents may have paid for your auto insurance while you were in school, but now it’s your turn. You’re going to be tempted to cut your coverage to the bare minimum to save money. Don’t do it. All it takes is one bad accident and you could owe someone tens or hundreds of thousands of dollars. If you don’t have that kind of cash lying around (and who does?), your wages could be garnished to pay back what you owe.
Instead, get full coverage and plenty of liability insurance. Full coverage includes comprehensive and collision insurance. This means whether you hit a tree or another vehicle, you’ll be covered. Full coverage also allows you to buy extra things like roadside assistance and rental coverage if you can’t drive your car after an accident.
Liability coverage is important in case you cause an accident and the other person is hurt or their vehicle is totaled. Your insurance will only pay medical and property damage claims up to your policy limit. Going to the hospital with a broken arm or hurt back is really expensive. If you buy $50,000 in liability coverage but the total claim is $150,000, you have to pay the difference. It’s much better to get more liability coverage even if your premiums are a little higher.
What About Health and Life Insurance?
Do you need health or life insurance after you graduate? It depends on a few things.
As long as you’re under 26, you can be covered under your parent’s health insurance. It’s possible that you may find a job that offers benefits like health insurance. In either case, you don’t have as much to worry about. At your job, when you become eligible for health insurance, do not procrastinate - get signed up as soon as possible.
But if you’re older than 26 and don’t have a job with benefits (all too common), you’re going to need to buy yourself a health insurance policy. Talk to an insurance agent who can walk you through the available plans and help you find out what kind of subsidy you qualify for.
Life insurance is a good idea for most people, but it depends on your situation. If you’re married or have a child, you should definitely buy a policy now. If you’re still single and your job offers a policy as one of the benefits, that may be enough until you get married or have kids.
Insurance can seem complicated but it doesn’t have to be. All you need is someone who can explain how it works, why it’s important, and how to get coverage without spending too much money. Here at Ross Insurance, we can help you with all of your insurance needs and answer any questions you have. Contact us today to make sure you’ve got enough of the right insurance coverage for your new life.