College teaches you a lot: writing, critical thinking, and public speaking, which are all valuable skills as you step into adulthood. But while you may leave with a well-rounded education, there are still some real-life essentials that often get overlooked. Things like buying a home, applying for a mortgage, filing taxes, investing your money, and yes, understanding insurance, are often missing.
This quick Insurance 101 guide is here to help ease you into the world of insurance and make it feel a little less overwhelming.
What Is Insurance?
At its core, insurance is a financial safety net. It’s there to help protect you from unexpected costs like a car accident, a health emergency, or damage to your home, so you’re not left dealing with the entire bill on your own.
Why Is Insurance Important?
Insurance provides financial protection when life doesn’t go as planned. It helps minimize the financial impact of surprise events and can reduce the stress of having to handle everything yourself.
In some cases, insurance isn’t just smart—it’s required. For example, most states mandate auto insurance. Be sure to check your state’s laws to double check you’re properly covered.
Key Insurance Terms to Know:
Premium: What you pay each month (or year) to keep your insurance policy active.
Deductible: The amount you’re responsible for paying out-of-pocket before your insurance kicks in.
Coverage Limits: The maximum amount your insurance will pay for a covered loss—limits may apply per incident, per year, or over the life of the policy.
Exclusions: Things your policy doesn’t cover (e.g., flood damage, which is typically not included in standard homeowners policies and requires separate coverage).
Co-pay: A fixed amount you pay for specific covered health services (like $20 for a doctor’s visit), often found in traditional health plans.
Claim: A formal request you submit to your insurance provider to receive compensation for a covered loss.
Types of Insurance to Consider as a College Student or Recent Grad:
Renters Insurance: This protects your personal belongings in a rented apartment—whether from fire, water damage, theft, or even if someone gets injured while visiting. Your landlord’s insurance only covers the building, not your belongings. Some policies even protect against off-site theft.
After getting renters insurance, it’s a good idea to make a digital inventory of your items. You can also bundle renters and auto insurance to potentially save money.
Auto Insurance: This covers damage to your car or someone else’s in an accident and includes liability if you injure someone. A clean driving record can help lower your premium. If you’re on a budget, consider a higher deductible to reduce your monthly payments, but make sure you have savings set aside just in case. Most states require auto insurance, so check your local laws.
Health Insurance: Health insurance helps cover doctor visits, hospital stays, prescriptions, and emergency care. Many people stay on their parents’ plan until age 26. If that’s not an option, look into your employer’s coverage, Marketplace plans, or Medicaid (if you qualify).
Pick a plan based on how often you visit the doctor. Just remember: the lower the premium, the higher your potential out-of-pocket costs.
Disability Insurance: Disability insurance replaces part of your income if you’re unable to work due to illness or injury. Short-term policies cover a few weeks or months, while long-term ones can last for years or even until retirement.
It typically replaces 60–70% of your income after a short waiting period. If your job offers this coverage for free or at a low cost, opt in—especially if you’re living paycheck to paycheck.
What Is an Insurance Agency?
An insurance agency doesn’t directly provide coverage, it works with various insurance companies to help you find the best plan for your needs.
Why Use an Insurance Agency Instead of Buying Online?
While it’s possible to purchase insurance directly online, doing so can often feel like navigating a maze of fine print and confusing terms on your own. When you work with an insurance agency like Chalmers Insurance Group, you're not left guessing.
We take the time to understand your needs, explain what will be covered (and what won’t), and walk you through options that fit your lifestyle and budget. Think of us like a trusted advisor helping you make informed decisions, so you're not caught off guard when it matters most.
Instead of one-size-fits-all policies, we work with multiple carriers to find coverage that’s truly right for you. It’s personalized, human, and thorough, everything an online quote tool can’t always guarantee.
Smart Questions to Ask Before You Buy:
- What exactly is covered—and what’s not?
- How much is the deductible?
- What’s the monthly premium?
- Is this policy right for someone at my age, income level, and lifestyle?
- Can I cancel or change it later?
This guide is just the beginning. There are plenty of other helpful blog posts here in the Learning Center to answer bigger questions you might have. The most important thing is to do your research, ask questions, and make sure the coverage you’re getting is what YOU want.
We hope this post helped make insurance a little less intimidating and gave you the confidence to start exploring your options.
