Going back to school? Here’s what you should know about insurance

This article has been updated from a previous version.

With September approaching, it’s time to switch gears from the summer holidays into back-to-school mode. Backpack; check, laptop; check, utensils and essentials; check — the preparation can be hectic.

However, even the most organized people can overlook a few things. Don’t let out your auto insurance be one of them. If you're leaving for post-secondary school, make sure you or your parents call your home and auto insurance provider before you go.

Are you taking your parents’ car to school? 

If you’re taking one of the family/shared vehicles away to school to get around town (and hopefully come home for visits), your parents should call and update them auto insurance policy. However, you should be aware of a few changes to the policy.

If you take your car to school full-time, list yourself as the primary driver

If you’re taking the car away to school full-time, you’ll be the person driving the car the most. Therefore, you need to be listed as the primary driver on the policy to ensure you get the coverage you need. Unfortunately, this can end up costing more (as you’re considered high-risk drivers from the insurer’s perspective).

You should also remind your parents to let the insurance provider know if you’ll be taking the vehicle to attend school out-of-province. Each province and territory has its own insurance rules, and they may require more coverage.

For instance, British Columbia, Manitoba, and Saskatchewan have public insurance markets regulated by the provincial government, which will slightly change how accidents are handled. You can also purchase additional coverage from private insurers if needed.

Even if you’re staying within the same province, shifting from a small town to a bigger metropolitan area can hike up insurance premiums. Cities often come with higher risks, such as increased car thefts and collisions, leading to more insurance claims. On the flip side, moving from a big city to a small town might save some money.

If you have your own car at school but also occasionally drive your parents’ vehicle when home

There is no restriction on the number of insurance policies a person can be listed on. If you live at home, it can be beneficial for your parents to be added to your policy and vice versa if you share vehicles.

Even if you mainly drive your own car, you might still need to stay on your parents’ policy for occasional use of their vehicle.

In this case, you can get a multi-driver or multi-vehicle discount. Insuring multiple vehicles under one policy can get you a discount, typically between 5% and 25% of your annual premium.

Some insurance companies may consider your car a household vehicle (depending on the address listed) and cover it under a larger umbrella policy that can simplify matters and potentially offer additional discounts.

Read more: What affects your auto insurance rates?

Auto insurance discounts for students

Many auto insurance providers offer discounts for young drivers and students, which could lead to a lower auto insurance rate.

1. Driver’s training discount: If you have taken and successfully passed a government-recognized driver’s training course, you could save hundreds of dollars in premiums for up to three years., you could save hundreds of dollars in premiums for up to three years.
2. Student away from home discount: If you’re away at college or university and you’re not taking the car with you, you’ll have less time behind the wheel. Many auto insurance providers offer a discount that could save between 30%-50% of the premium your parents are paying for listing you on their policy. This way, you’ll still be covered when you borrow the car or go home during the holidays. Generally, this applies when students attend a university or college, that is 80 to 150 kilometres away from home.
3. Good student discount: Hard work can pay off. Some companies offer a ‘good student discount’, typically up to 5%.
4. Credit score discount: Certain provinces like Quebec and Alberta offer students discounts for maintaining good credit score.
5. Telematics program: Giving your insurer permission to monitor your driving habits through a mobile app can lead to a discount of up to 20% as a reward for safe driving.

Related: Most common insurance claims in Canada

Home insurance or tenant insurance for students

Auto insurance isn’t the only thing you need to worry about. Whether you take the car or leave it at home, you will have many other belongings to insure. From costly computers to textbooks and keepsakes, your items can be pricey to replace.

Schools are unlikely to cover lost, stolen or damaged items. Fortunately, most home insurance policies extend coverage to children attending college or university, up to a specific limit. This applies if the family home is still considered your primary residence.

Check with your parents’ insurance provider to understand any limitations. For example, items may not qualify for coverage if you study abroad or if the value exceeds the claim limit.

There’s also a caveat: If you make a claim, your parents’ home insurance rates may increase.

Related: Tenant insurance: It’s not just about protecting your stuff

While tenant insurance isn’t mandatory in Canada, landlords may require students living off-campus to purchase tenant insurance, also known as renter’s insurance, to protect your possessions and from liability.

Tenant insurance has three main components:

1. Contents coverage: If any possessions are stolen, or damaged by flood or fire, contents insurance would cover the cost of replacing the items up to a limit. This coverage extends beyond your home too. For example, if your bike was stolen outside the library, tenant insurance would help with the replacement cost.
2. Personal liability coverage: If someone accidentally injures themselves in your apartment accidentally, say by slipping and falling, liability coverage would help cover the costs associated with lawsuits.
3. Additional living expenses: If your house was affected by fire or another insured peril and became temporarily uninhabitable, this aspect of tenant insurance would help provide temporary accommodation and transportation until the home is habitable again.

For students sharing a space with roommates, it can be more challenging. All residents should have their names on the lease and their own insurance coverage. Suppose someone was accidentally injured; you would not want one person held liable.

Read next: Does renters’ insurance cover damage to the landlord's property?