Does Your License Still Say Your Parent’s Address But You Have A Lease Elsewhere? Here Is Why You Won’t Be Covered On Their Auto Policy:

How many of you live in an apartment at school and are still on your parent’s auto policy? I know I was and just about everyone I knew was too. Did you know that if you live in an apartment or house on campus year-round (12 month lease), you aren’t actually eligible to be on their auto policy?! In my personal experience, I lived in an apartment at school but would come home during the summers between leases, so my situation was considered a special circumstance—aka I was still eligible to be on my moms auto policy and considered a resident relative. My friend on the other hand, signed leases for instance June 1-June 1 then moved in the next apartment June 1; this is not considered a resident relative, so they are NOT eligible to be on their parent’s auto policy. How this affects you? Well, here are two scenarios explaining it:

Scenario 1- You get in an accident. Thankfully you are considered a resident relative because you only live on campus during the school year, so your parent’s auto policy covers you and helps pay for expenses related to the accident. Whew!

Scenario 2- You get in an accident. You live on campus year-round and both you and your parents think their auto policy covers you. Unfortunately, since you aren’t a resident relative, their policy doesn’t cover your accident (aka medical or liability coverage if you injure someone else) despite your license still saying you live at their address. Your license address doesn’t matter in this instance—why? Insurance carriers have investigators that will find out about your situation, and they will look at your lease contract(s) to find out about coverage.

This is extremely important information to know and understand—you might think of yourself as a broke college student now, don’t make your situation even harder by not having the proper coverage. “My parents pay my car insurance, I can’t afford to right now” in this situation, your parents should talk to their independent agent who can inform them on the best coverage options for you and can set up the payment to come out of their account.

Speaking of broke college student… here is a true story about a college student and their auto policy: A medical student got in an accident and had low limits of liability. They seriously injured someone and had to go to court in front of a judge and a jury for the damages. The judge looked at the profession they were going into, knowing they would make a lot of money in the future, so the judge garnished future wages of the medical student. This is why it’s SO important to review your liability limits and discuss an umbrella policy with your independent agent…. Tune in next time for the tea about umbrella coverages!

Thanks for reading The Gen-Z Insurance Tea, where I’m the CEO of warning you about important insurance info so you won’t have to find out in the moment.