There’s a lot of excitement leading up to the time when your child plans to attend college. And there’s a lot of preparation involved, too. Two matters that need to be considered carefully when assessing car insurance for college students are whether your student will be driving and the extent to which your auto insurance coverage needs to be changed.

Indeed, matters related to car insurance for college students away from home are important to discuss and explore well before the first day of classes. That’s because rates for young drivers are expensive, the experts agree. But you may be eligible for car insurance discounts for students away at college.

Car insurance for college students away from home: Why it pays to plan ahead

“Insurance rates have been going up in a lot of areas over the last few years,” says Greg Martin, president of Think Safe Insurance, LLC, in Brandon, Florida.” You want to make sure you have the proper coverage for your student driver, but you don’t want to overpay for insurance if there are savings you can take advantage of.”

Troy Harmon, owner/agent with Harmon Insurance in Coldwater, Michigan, notes that automobile insurance is typically among the top 10 most costly recurring expenses within many households today.

“But the good news is that when a college-age student moves to their school of choice and their access to insured vehicles changes, there could be an opportunity for your family to enjoy a rate reduction, although this may vary from carrier to carrier,” says Harmon.

Fortunately, there are several options you can explore that can save big money on car insurance if you and your student qualify.

Scenario #1: Your student will live more than 100 miles away and have no vehicle on campus

If your child will be attending a college or university far from home – meaning 100 or more miles away – and they don’t plan to have a car with them, you have the potential to save the most money. That’s because you can apply for a “student away at school discount.” This lowers the rate on your policy (often between 15 and 30 percent) but still factors in some usage for when your child comes home for breaks, holidays, and summer vacation.

“With this option, you don’t have to add and delete your child every time they return home,” says Martin.

Alternatively, you can inquire about changing your student from a primary driver to an occasional driver, which usually means someone who drives less than 25% of the car’s annual mileage (although the rules for this will vary depending on the insurance company). This move could lower your premiums.

Instead, you could request that your carrier exclude your child from coverage entirely until you are ready to reinstate him or her onto your policy, but many don’t suggest this.

“Some companies and some states allow a student to be excluded from coverage, but this is not recommended, as it would not provide coverage if the teen was home or driving a friend’s car while at school,” Martin cautions.

“When your child returns home, a quick call to your insurance agent to reinstate coverage for the time they’ll be at home is all that’s needed,” Harmon explains.

If your student’s designated vehicle won’t be used while they are away from home, it’s smart to take that automobile off the street and put it into the garage or another storage area to avoid damage to or theft of that vehicle.

Scenario #2: Your student will live less than 100 miles away from home but have no vehicle on campus

Let’s say your son or daughter plans to leave the automobile at home while they are attending college but the school is less than 100 miles away. In this case, you may not be eligible for a “student away at school” discount; most insurers require that the student driver live 100 or more miles away from home to qualify for that reduction.

“Your best option here is to contact your insurance agent and update your child’s usage information to make sure coverage for them reflects less driving because they are away at school,” says Martin, who notes that your premium may be reduced to reflect the fact that your student will have less time and opportunity to drive, even though they live a bit closer to home.

Or, as aforementioned, you could switch your student’s rating from a primary driver to an occasional driver. Or you could remove your child from your policy entirely, if your carrier allows it, and call your agent to reinstate your student when he or she plans to come home for breaks or holidays.

“But they may not allow you to exclude your child if they live less than 100 miles away, as they will likely assume that your child will be home more often,” says Martin.

Scenario #3: Your student will live on campus and bring a vehicle with them

Assume your daughter or son will be living at school but needs to drive a car while away from home. Here, you wouldn’t qualify for a student-away discount and you can’t drop coverage for your child. But you may still be able to lower your premiums.

“The ZIP Code where the vehicle will be kept will increase or decrease your premium, depending on how the rates around the school are compared to your home address,” adds Martin. “Notify your insurance company that your teen will be taking the car to campus, and provide the address where your teen will be keeping the vehicle. If you live in a city and the campus is in a rural area, you may see a decrease.”

Harmon points out that your student will need to be rated as the primary driver on the vehicle covered by your auto policy.

“The policy needs to be rated correctly in the event of a claim, which is when you’re insurance company will start asking questions,” he says. “This is when it is the most important to have a correctly rated policy, regardless of the premium paid. When something happens, the last thing you want is for them to deny a claim, which could be a devastating consequence.”

The good news is that auto insurance rates overall for full-time college students are usually less than for a high school graduate who doesn’t attend college.

“Insurance companies assume that a full-time college student is less likely to drive as frequently as someone who works full-time,” says Rocky Dellamano, a financial representative for Country Financial in New Lenox, Illinois.

Scenario #4: Your student lives at home and drives a car

Many college students choose to live at home and commute to and from school. If this is true for you, the chances are slimmer that you can save money on auto insurance. In this scenario, you can’t exclude your child from coverage, switch him or her from a primary driver to an occasional driver, or claim a student-away discount.

“But it still pays to have a conversation with your insurance agent. Find out if the distance to the college is less than the distance your child used to drive to high school or work, for example. Remember that most auto policies are rated on usage and distance one-way to and from work or school,” Harmon suggests.

Other ways to save

These aren’t the only ways to decrease your auto insurance costs when you have a student driver in the family. Additionally, consider the following strategies:

  • Apply for a good student discount. If your child earns high marks in school, this may lower your car insurance premiums. Most car insurance carriers provide a discount to students up to the age of 25 if their grades meet certain criteria (normally a B average or better). This good student discount can equate to savings between 5% and 25%.
  • Drop collision and comprehensive coverage entirely. “If your child has an older car that’s garaged or only driven sporadically, you really don’t need these types of coverage anyway. Put a portion of your premium savings into a repair fund each month if you’re concerned about what might happen when your student returns on break,” recommends Brian Martucci, the Minneapolis-based finance editor for Money Crashers.
  • Increase your deductibles. “Upping your deductible from $500 to $1,500 can reduce your annual premiums by three figures,” Martucci notes.
  • Keep your student on your policy. “When a student looks at getting their own policy, they will usually lose many discounts their parents have – including discounts for multiple vehicles, multiple policies, longevity and established credit scores. That can cause premiums to increase dramatically,” says Harmon.