Insurance 101 – An Introductory Course
School is officially back in session, and as the summer season quickly draws to its end and the brisk fall weather slowly rolls in, the one subject that’s on every college student’s mind is…insurance. Well, maybe not. But as students move into their dorms or off-campus apartments, it is a subject worth thinking about.
Until now, your parents have probably handled all of your insurance decisions. Even if they still do, it’s important for you to understand your insurance coverages in the event of an accident or loss. There are two main types of insurance appropriate for most college students to purchase: auto and renter’s. Below are tips to pass along to that college student in your life.
Do I Really Need Renter’s Insurance?
Make a mental list of the things you own. At first glance you may not think that you have much to insure. Your computer or tablet? Your television? Your video game system? When you start to add up the price of these items, the price to replace it all generally outweighs the cost to insure it.
Renter’s insurance covers the items in your dorm room or apartment, but only your possessions, not your roommate’s. Much like auto insurance, it also covers your liability if you negligently hurt someone or something. It also covers your personal property that may be stolen from your car or taken from your backpack while you study at the library.
If you live in a dorm, it’s likely your parent’s homeowner’s insurance will cover your stuff, but there may be a limit on what is covered. So if you buy a new laptop or tablet, make sure your parents know so they can talk with their agent about making sure there is adequate coverage. If you live in an apartment or share a rental house, you will likely need your own insurance policy. The policy will cover a set amount of stuff that you own and will cover your liability if somebody gets hurt at your place.
No matter where you live, it is a good idea to have a full list of your stuff that you have with you at school. A home inventory will help you and your parents know how much insurance you need and if something happens you can use it to file your claim. The National Association of Insurance Commissioners (NAIC) has a free smartphone app that can help in creating a home inventory. Click here for the Android app and click here for the iPhone version.
What About Auto Insurance?
Louisiana is one of many states that require you carry liability coverage on a vehicle you plan to drive. Liability coverage pays damages and injuries to someone else if you are found responsible for an accident. So, whether you drive a brand new car or the family clunker, you must have continuous liability coverage.
If you want coverage for damages to your car, you will need to purchase comprehensive and collision coverage. Collision coverage fixes damage caused when you hit something like another car, or if somebody hits you. Comprehensive coverage is for just about everything else – like hail damage or hitting a deer. You will have to pay for part of the repairs – that is your deductible and that amount is listed on your insurance card. Speaking of insurance card, always make sure that it is in the vehicle and if you let a friend borrow your car, make sure they know where to find it.
If your name is on the title for the car, you will need to purchase your own insurance policy. If your parents own it, you may be able to remain on their policy, which may be less expensive. Remember to notify the insurance company of the address where the vehicle will be stored.
If you are in an accident, it is important to get certain information from the other driver. It is also important not to give the other driver too much information about yourself or your parents. Do not admit fault for an accident. The NAIC has a free smartphone app for Androids and iPhones that helps you know what information to get following an accident.
State of Insurance Ten Years Post-Katrina Summit Recap
The Louisiana Department of Insurance marked the anniversary of Hurricanes Katrina and Rita with a new report on the State of the Insurance Market in the ten years since the storms ravaged the Gulf Coast. The Department also hosted the State of Insurance Markets Ten Years Post-Hurricanes Katrina and Rita Summit which was held on August 11, 2015 at the University of New Orleans.
The report details the effects of two of the most costly disasters in United States history and how the Louisiana insurance market has grown over the past ten years. Commissioner Donelon was joined by Mississippi Commissioner of Insurance Mike Chaney as well as business leaders and representatives from the insurance industry.
Today, Louisiana’s insurance market is stronger than ever, with 22 new insurers in the marketplace and higher participation in the National Flood Insurance Program (NFIP) than before the storms. In 2014 Louisiana homeowners’ rates rose 2.8 percent on average which is the lowest statewide average rate increase since 2005. Many factors contribute to the recovery of the private insurance market including the creation of a mandatory statewide building code in 2005 and incentives that encourage homeowners to strengthen their properties against storms.
To read the full report, video and resources from the Summit, please visit www.ldi.la.gov/katrinasummit.
Commissioner Donelon serves as moderator during Hurricane Katrina Summit at University of New Orleans. (Panelists from left to right: Jeff Albright, Blythe Lamonica, Richard Clements and Vijay Ramachandran)
New to Medicare?
For many first time enrollees, figuring out the proper procedure for enrolling in Medicare can seem like a daunting task. Luckily, the Louisiana Senior Health Insurance Information Program (SHIIP) is here to help. Senior health counselors from SHIIP assist Medicare beneficiaries in better understanding their coverage options and benefits. Senior health counselors offer free and unbiased guidance via telephone or in-person.
It is important to learn the basics of Medicare requirements and options for enrollment to make the most of your coverage and avoid costly mistakes. With the 2016 Annual Enrollment Period just around the corner, below is some guidance to assist in your first time enrolling in Medicare.
Understanding rules for enrolling in Medicare for the first time
There are two ways to get Medicare Parts A (hospital insurance) and B (medical insurance): through automatic enrollment by the federal government OR by signing up yourself. If you receive Social Security retirement, Railroad Retirement or disability benefits, you will be automatically enrolled in Medicare when you first qualify. If you are NOT receiving retirement or disability benefits, you need to actively sign up during one of three enrollment periods:
- Initial Enrollment Period (IEP) – When you are first eligible for Medicare, you have a seven-month period to sign up. This includes the three months before you turn 65, the month you turn 65, and the three months after you turn 65.
- General Enrollment Period (GEP) – If you miss your IEP, you can sign up from January 1 through March 31 each year. Your coverage will begin July 1 of that year. Note that you may have to pay a higher premium for late enrollment if you miss your IEP.
- Special Enrollment Period (SEP) – If you or your spouse (or family member, if you are disabled) is currently working and you are covered by health insurance through that current employer or union, you will have an SEP to enroll in Part B while you are working or within eight months of your coverage ending.
Understanding your Medicare coverage choices
You can choose to receive your Medicare benefits in one of two ways: through Original Medicare OR a Medicare Advantage Plan.
- Original Medicare is the traditional fee-for-service insurance program offered by the federal government and includes Part A and Part B coverage. To get Medicare drug coverage (Part D) with Original Medicare, you will need to join a stand-alone Medicare Prescription Drug Plan (PDP).
- Medicare Advantage plans are private health plans that contract with the federal government to administer Medicare benefits. These plans must offer all benefits offered by Original Medicare. They may also offer additional benefits, such as routine vision or dental care. Each Medicare Advantage Plan can charge different out-of-pocket costs and have different coverage rules. Note that most Medicare Advantage plans offer drug coverage as part of their benefits package.
Understanding when you can change Medicare coverage
Medicare limits how often you can make changes to your Medicare coverage. You can make changes every calendar year during the fall Open Enrollment Period (OEP) from October 15 to December 7. Changes made to your coverage will take effect January 1 of the next year.
Additionally, you may be able to change your Medicare coverage during the calendar year if you meet certain requirements, such as if you move to a new home or nursing home or if you qualify for certain programs that help pay Medicare costs.
For more information about enrolling in Medicare and the upcoming enrollment period, feel free to contact a senior health counselor at 225-342-5301 or visit www.ldi.la.gov/SHIIP. You can also view a list of senior health counselors in your area by clicking here.
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