A system of protection against loss in which a number of
individuals agree to pay certain sums for a guarantee that they will be compensated for a specific loss.
Every state has financial responsibility laws…requiring that you can pay for damages that you cause
What is a definition of insurance?
Policy
Property Damage Liability Bodily Injury Liability
Medical Payments Insurance Collision Coverage
Comprehensive Coverage No-Fault Coverage
Uninsured Motorist Coverage
Underinsured Motorist Protection
What are the different types of auto insurance?
…let’s consider them one at a time
Liability insurance covers the damage
you cause to other vehicles, people,
or property
Oops, my fault
There are two types
What is Liability?
What is Property Damage Liability?
Property Damage Liability insurance covers the damage you cause to other vehicles or property
Recommended coverage:
$100,000 Property damage each occurrence
If you were to hit a very expensive vehicle(s) or take out an expensive traffic light – the cost could be very high…required in most states
Oops, my fault
What is Bodily Injury Liability?
Recommended coverage:
$100,000 each person
$300,000 each occurrence
Required in most states.
State minimums are usually inadequate
Oops, my fault
Bodily Injury Liability pays claims for injuries or death
you have caused to others involved in the collision
Pays immediate medical cost even if there is additional medical insurance
Medical Payments Insurance covers bodily
injuries and funeral expenses for occupants in an insured vehicle up
to stated amounts, regardless of who
was at fault What is Medical
Payments Insurance?
Important coverage for new and expensive cars…
usually dropped after about 7 years of ownership when the vehicle’s value has decreased
Collision Insurance pays the cost of repairing or replacing
the owners car when the owner is at fault or
when when the owner cannot collect from the
person who is at fault What is Collision
Insurance?
Important coverage for new and expensive cars…
usually dropped after about 7 years of ownership when the vehicle’s value has decreased
Comprehensive
Insurance pays the cost of repairing or replacing
the owners car if damage results from:
fire, theft, storms, flood, wind, vandalism,
earthquake and riots What is Comprehensive
Insurance?
Some states have this to prevent over burdening the courts with litigation
No Fault Insurance:
People involved in collisions recover their
losses from their own insurance company regardless of who is at fault…but with limitations
as specified in the policy
No fault insurance is handled differently
from state to state
What is No Fault Insurance?
It pays for injuries to you or your passengers in the event of a hit and
run collision or if those who hit you have no
insurance or are underinsured
What is it?
Required in many states.
Needed by all car owners It pays for injuries to you or your passengers in the event of a hit and
run collision or if those who hit you have no
insurance or are underinsured
Covers medical bills, legal and court fees,
loss of wages
“Hey, you get back here!”
Good to have…but not a necessity if you belong to an auto club
Towing Insurance pays the cost of towing and some minor repairs to
the disabled car.
Included are: dead battery, out of gas, flat
tire and “accidents”
What does Towing Insurance cover?
Premium:
What do these terms mean?
What you pay for your insurance coverage Most policies are for a 6 month period
Deductible: The amount you agree to pay toward the repair or replacement of the vehicle. Your insurance company agrees to cover the
balance up to the specified limits of the policy
Selecting a higher deductible will require a greater out of pocket expense,
but it will also____________________lower the premium
How are rates determined?
Collision and Violation record Age of principal driver
Gender of driver Martial status
Where the driver lives
Type of vehicle and miles driven
WHAT ARE SOME WAYS YOU CAN SAVE MONEY ON INSURANCE?
Four Wheel Anti-lock brake system and passive restraints
(Airbags or Automatic motorized seat belts)
Anti-theft devices Good Driver
Multi-Car
Economy Car 55 and Retired Good Student
Failure to stop is a serious violation. Do not leave your vehicle where it will block traffic
(if it can be moved)
Be sure to turn off the ignition
Stop immediately…if you can
move to the side of the road
Never move an injured person unless there is danger of fire or another collision
Aid the injured…
administer basic first aid for injuries only if qualified Stop immediately…if you can
move to the side of the road
Stop immediately…if you can move to the side of the road
Do not put yourself or others in danger while directing traffic
Aid the injured…
administer basic first aid for injuries only if qualified
Protect the scene with flares or
reflectors or direct traffic
Stop immediately…if you can move to the side of the road
Do not let them talk you out of it by saying:
“We can handle the matter ourselves.”
Aid the injured…
administer basic first aid for injuries only if qualified
Protect the scene with flares or reflectors or direct traffic
Send for police – give the facts
Stop immediately…if you can move to the side of the road
Names, addresses, driver’s licenses
numbers, plate numbers, and
insurance companies
Aid the injured…
administer basic first aid for injuries only if qualified
Protect the scene with flares or reflectors or direct traffic
Send for police – give the facts Exchange information – but do
not admit it was your fault
Additional Steps Record witnesses names and addresses File necessary reports See their insurance card
When filing the report
Note the time of day, weather conditions, road conditions, street lights, signs, and the presence and length of skid marks. Make a diagram
illustrating the location of the vehicles, crosswalks, stop signs, and traffic signals.
If you have a camera, take pictures.
Other Important considerations
Continue your medical care after the accident.
Even serious injuries may remain undetected even after the initial visit to the doctor or emergency
room. Medical expenses may be covered by your insurance plan.
Other Important considerations
Contacting a lawyer.
Your insurance company must be contacted in the proper fashion to insure that all
benefits are obtained concerning your
personal injuries. Failure to properly notify and inform the company may result in an objection to such a claim at a later time.
Also, forms must be filled out for the Department of Public Safety, the local Police Department, or the
Registry of Motor Vehicles.
A lawyer’s assistance may be invaluable in these situations.
Quiz time…how much do you remember?
2) If you were to crash with an expensive vehicle and it was your fault, your ______________________would pay.
4) Medical payments insurance covers injury expenses for occupants in an insured vehicle regardless of who was at fault. TRUE or FALSE:_______
5) Collision insurance pays the cost of repairing the owner’s car when the other driver is at fault in the collision?
TRUE or FALSE: _______
1) Liability insurance covers the damage you cause to other vehicles, people or property. TRUE or FALSE:_________
3) If it was your fault in a crash and there were injuries in the other car your _____________________would pay.
7) After about 7 years of car ownership, most people will ______________the comprehensive insurance on the car.
9) It pays for injuries in the event of a hit and run collision or if those who hit you have no insurance:______________
10) The amount you usually pay to an insurance company every six months is called a: _______________
11) The amount you agree to pay ahead of time toward the repair of the vehicle: ______________
6) What part of your insurance pays for a tree falling on your car during a storm? _____________________
8) In some states with this type of insurance, the driver’s insurance policy only covers their own damages: ________
13) TRUE or FALSE: Your premium rate is mostly based on your driving record, age, and type of vehicle. _______
15) Owning an economy car with an anti-lock braking system is one way of reducing your premium. ______
16) The first thing you should do if involved in an accident is to: ________________________________________
17) In a collision, you should aid the injured only if you are:
___________________________________
12) Selecting a higher deductible will usually result in a higher premium. TRUE or FALSE: ________
14) Married people, country dwellers and females will
generally pay less than males, city people and singles?____
19) TRUE or FALSE: It’s always a good idea to call the police at the scene of an collision. ______
21) If the police are at the scene, they will take care of filing all the paper work involved. TRUE or FALSE: ______
22) Insist on seeing their proof of insurance that they are required to carry in their vehicle. TRUE or FALSE: ______
23) If you feel the slightest discomfort after the collision, its important that you seek: ________________________
20) When you know its your fault, go ahead and admit it as you exchange information. TRUE or FALSE: ______
18) How can you “protect the collision scene” from further damage? ______________________________________
