This article briefly discusses how a personal auto policy responds to exchange students. Please be sure to read its companion article, "Exchange Students – Homeowners Coverage."
First, make sure that the exchange student is permitted to drive under the rules of the exchange student program. If program rules allow driving, contact your motor vehicle department to make sure that your student has a valid driver’s license.
The typical auto policy extends its coverage to any person having your permission to drive a covered vehicle. Your liability coverage will protect the exchange student against damage or injury that he or she causes to others. Coverage to damage done to your vehicle is also available when you have the appropriate physical damage insurance. Of course the coverage is subject to your policy’s insurance limits, deductibles and other provisions.
Medical payments coverage will apply to the exchange student who is injured in an accident while occupying or driving your car with your permission. If you expressly forbid the exchange student to drive your vehicle and the student disregards your wishes, you may not have insurance coverage if an accident occurs. Any questions regarding an exchange student’s vehicle use need to be carefully considered; especially since you will want to avoid having to deal with uncovered auto losses.
Be very careful regarding any minor-aged exchange student who is considering buying a car, truck, motorcycle, RV, boat, moped, scooter or any other vehicle. An exchange student’s temporary residence status makes it very difficult to get proper coverage. Student vehicle owners who cause an accident could experience some complex legal problems. If faced with an exchange student who owns a vehicle, it is important to get any available assistance from the exchange student program, including their legal counsel. You should seek your own qualified legal help to make sure that your interests are protected. The safest course would be to avoid an exchange student situation that includes an owned vehicle.
Please check with a qualified automobile insurance professional to thoroughly discuss your coverage needs.
This article briefly discusses how a homeowner policy responds to coverage for exchange students. Please be sure to read the companion article, "Exchange Students – Automobile Coverage."
Note: Check with your exchange student program coordinator to see what kinds of coverage are automatically provided for the child. But don’t take anyone’s word; get copies of documents that prove the coverage situation.
An exchange student in your care who is younger than 21 years is automatically insured under a homeowners policy, treated as if the child were a relative. An exchange student's property is covered while located at or away from your home. Off-premises coverage is normally limited to 10% of your policy’s Personal Property limit, subject to a minimum of $1,000. On-premises, the policy’s full content limit is available. If your homeowners policy had a $70,000 limit for Personal Property, up to $7,000 would be available to handle damage or loss to an exchange student’s property while it’s away from your home, say while at a summer camp. Liability coverage that applies to your family also applies for damage and bodily injury caused by an exchange student who is younger than 21 years of age.
If the exchange student is older than age 21, then the policy treats the student as a guest. A policyowner can volunteer to extend his insurance coverage to include a guest's property while at your residence premises or even while you and the guest are at some other location. However, it is sometimes difficult to determine whether an older exchange student is a guest or a tenant - someone who is paying you a reasonable rent for staying in your home.
Hosting an exchange student creates questions you should discuss with an insurance professional who can help make sure your coverage needs are met.
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