With medical costs on the rise, health insurance is essential. Without insurance, a broken leg could cost $10,000 or more. An emergency appendectomy could top $50,000.
You may not have a choice. According to a 2008 study by the Government Accountability Office, 30 percent of colleges and universities require students to have health insurance.
Here are some options:
Your best choice is to keep your children on your insurance plan. Under the Affordable Care Act, you can add or keep your children on your health insurance policy until their 26 birthday - even if they no longer live with you, are not financially dependent on you, are married, or no longer in school. The requirement, however, does not apply to adult children who are eligible for employer health coverage.
Many colleges offer low-cost student health plans ranging from simple accident policies to comprehensive medical plans. Annual premiums range from under $100 to more than $2,000. Check with the admissions office at your child's college to see what is available.
You may want to consider purchasing an individual health insurance policy, but this can be costly.
Many parents buy life insurance policies for their children when they enter college and then turn over the payments to them when they graduate.
There are two basic types of insurance: term and permanent. Term life insurance offers protection for a specific period - 10, 20 or 30 years. It usually costs less than permanent life insurance, which provides lifelong protection.
Policies are usually less expensive when the insured is young and healthy. For instance, a 19-year-old, healthy, non-smoking male can purchase $100,000 of term coverage for 20 years for $10 a month or lifetime coverage for $28 a month. Women usually pay less because statistics show they live longer.
If your child is taking a car to college, your premiums may rise or fall depending on the type of car and the school's location. Contact your agent to discuss your options. It's usually best to keep your children on the family policy so they can benefit from multi-car and multi-policy discounts.
If your child is living in a dorm, your homeowners insurance may cover his or her belongings. Check with your agent to learn about the rules and limitations. If your child lives off-campus, you should consider buying renters insurance, which will cover possessions and provide liability coverage. Policies cost about $200 to $300 per year.