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Are you putting your children’s financial well-being in jeopardy with an insurance coverage gap? Let’s face it, insurance is confusing. In the health care world, you can keep a child covered on your policy until they are 26 years old. This means they can even be employed, offered health coverage or married and STILL be on your health insurance policy. However, don’t assume that auto coverage and their belongings follow suit.

While a child is attending college, is a full time student and still declares your home address as their

address, they typically have coverage under the parent’s policy. Some insurance companies will even

cover their property in a dorm room but this is company specific so you would want to check. The big issue becomes when they are no longer deemed a resident of your household and have their own

residence. “The definition of who has coverage under a homeowner/auto policy as an insured is

limited to “residents of your household who are your relative” and further extends away from the home for “a student enrolled in school full time, as defined by the school and is under the age of ____-varies by carrier)” If the child doesn’t meet the criteria- you have a gap in coverage.

Are you the parent who purchased a home or condominium for their child to live in while they attend college? Although the parent purchased it, it is not THEIR residence and they don’t live there. The child really needs a renter’s policy with liability coverage to be protected while staying there as the parent’s homeowners policy no longer extends to them.

Auto insurance can be very interesting. The first question is always WHO is the car titled to? In the

event of an accident where someone gets hurt or killed; the lawsuit comes back to who is on the title,

not just who was driving. IF the car is titled to your child but they are not a full time student or living at home, they typically have NO coverage in a lawsuit. They, by the definition of an insured, are NOT an insured on the policy unless you have listed them as an additional interest. If your child has a car titled in their OWN name, they need their own insurance policy. The opposite is also true- a vehicle titled and insured by the parents, but in possession of the a child who isn’t a resident of the parents’ household creates a gap in coverage for a child who borrows a vehicle as well as one for anyone who is injured while a pedestrian or passenger in another vehicle who doesn’t have enough coverage.

Here are some examples where adult children would NOT have coverage because the definitions, as stated above, don’t apply:

• Your child borrows a friend's truck to pick up furniture they purchased and causes

injuries to someone crossing the street. Your child didn’t know the friend had no

insurance on the truck. Now your child has no liability coverage for the injuries they


• Your child rents a vehicle while on vacation and doesn't buy the insurance offered by

the rental car company. Again, there’s no coverage for property damage to the rented

vehicle or bodily injury to others if there’s an accident.

• Your child is hit by an uninsured motorist while walking across the street. There are no

medical payments or uninsured motorist's coverage for his or her own injuries.

• Your child is at a concert and accidentally bumps someone off the edge of the stadium

bleachers causing severe injuries. There’s no coverage for the injuries caused to that


So many times parents are trying to help out their child out with costs by keeping them on their insurance policy but ultimately, they can be creating more risk for them and potentially cost them financially more in the future by not having them get their own policy. You should always sit down with your agent and review as your child turns 16 and begins driving for the first time through their college years. There are many options that can be explored to find the best deal for your child and your family to provide adequate coverage. If you have any questions, I’d be happy to review your policy with you.

Source- West Bend Cares Safety Blog: Insuring your adult children: When do insurance coverage gaps arise? Written by Joyce Schuett and posted by Scott Stueber

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