Automobile Insurance Insurance Basics for Students

Evaluating Your Insurance Needs n Auto Insurance –Parts of an auto policy –Auto insurance cost factors –Teen crashes –Auto insurance laws in Ohio –Financial Responsibility law –Graduated Licensing law –Your insurance needs –Shopping for Insurance –Cost saving tips –Tips for settling an insurance claim

Parts of an Auto Insurance Policy n Declarations n Your Information –Who’s insured (name and address) –Vehicle(s) covered (V.I.N.) n Your policy specifics –Amount of insurance - Policy Limits –Premium (the price of insurance coverage)

Parts of an Auto Insurance Policy n Coverages n Bodily Injury Liability n Property Damage Liability n Medical Payments n Uninsured Motorists n Underinsured Motorists n Uninsured Motorists Property Damage n Damage to Your Auto –Collision –Other Than Collision (Comprehensive)

Parts of an Auto Insurance Policy n Definitions –Terms of policy defined n Exclusions –What’s Not Covered in the policy n Conditions –Responsibilities of the contract are specified for you and the company

Auto Insurance Cost Factors n Factors that determine cost of insurance n Use of car (to & from work, pleasure) n Value / Type of car (make & model) n Repair costs for car & occupants (crashworthiness) n Where you live and how car is parked n Your driving record n Coverage limits n Sex & Marital status n Good Student Discount n Age of drivers

1 Licensed driver statistics as of June 6, Ratio reflects the chance for involvement in a crash 3 Includes drivers under 16 years of age and drivers with age-not-stated involved in crashes NA = Not applicable Sources: Ohio Department of Public Safety 2000 Ohio Traffic Crash Facts and 2000 Ohio License Statistics by County, Age and Sex

Teen Crashes n Top contributors to teen crashes n Inexperience n Speeding n Passengers / Distractions n Night driving / Road conditions / Weather n Low safety belt use n John Hopkins University study n 16 yr. old drivers - higher risk of dying behind the wheel –39% higher with the addition of 1 passenger –86% higher with 2 passengers –182% higher with 3 or more passengers

Auto Insurance Laws n Ohio’s Financial Responsibility law n Requirements met by having one of the following: –Auto Liability insurance (12,500/25,000 BI; 7,500 PD) –Surety bond of $30,000 –BMV Certificate - bond of $30,000 on file with BMV –BMV Certificate - bond of $60,000 in real estate on file –Certificate of Self Insurance - those w/ 25 or more cars

Auto Insurance Laws n Ohio’s Financial Responsibility law n Required to show proof of FR when: –A moving violation requires a court appearance –When stopped by law enforcement officials for a traffic violation, vehicle safety inspection or involved in a crash and asked to provide it –Contacted via mail through the BMV random verification program n Auto insurers provide an Auto Insurance ID Card –Keep it in car - satisfies FR proof when asked by law enforcement officials

Auto Insurance Laws n Financial Responsibility law Penalties n Lose Drivers least 30 days, up to one year n No driving privileges during suspension n License plate & vehicle registration suspension n License reinstatement fees of $75-$500 n Requirement to obtain insurance for five years - monitored by insurers and BMV n Vehicle immobilization and confiscation of license plates for violation FR suspension –3rd and subsequent offenses - could mean vehicle forfeiture + 5-year moratorium on vehicle registrations

Auto Insurance Laws n Ohio’s Graduated Licensing law n Temporary permits can be obtained at 15 1/2 –Drivers training component n Drivers Education Training n Plus 50 hours behind the wheel with Mom & Dad n Probationary drivers license –At least 16 years old –Must pass BMV driving and maneuverability test –Probationary license held until 18 when full privileges without restrictions granted n Curfew restrictions & penalties apply –Driving under the influence –Moving violations

Your Insurance Needs n Shopping for insurance n Agent, toll-free numbers, internet –Have agent/company representative explain what’s NOT COVERED in the policy - this avoids surprises after a loss –Many prefer to investigate coverage options and prices via the web, then contact an agent or company n Evaluate your need for an agent - is it important to you to have an insurance professional for advice? n Insurance premiums n Paid monthly, quarterly, semiannually, or yearly n Homeowners - watch for PITI in your mortgage –Principal, Interest, Taxes, Insurance

Your Insurance Needs n Insurance cost saving tips n Ask about discounts n Good student, more than one car, carrying other types of insurance with the same company n Increase deductibles n Generally, the higher the deductible, the lower the premium n Avoid filing frivolous and/or excessive claims n Comparison shop n Keep property (car and home) well maintained

Your Insurance Needs n Settling an insurance claim n Contact insurance agent/company ASAP n Take steps to prevent future losses to property n Gather as much info as possible about the loss –witnesses, videotape/photo damaged property n An insurance company representative will contact you (claims adjuster) asking details about the loss –Adjuster may want to record your conversation n Work with adjuster to an agreeable negotiation –If not satisfied, you have the option to contact Ohio Dept. of Insurance - Consumer Services Division - for info or to file a complaint (

OII Mission Statement n To strengthen public understanding of and confidence in Ohio’s property/casualty insurance industry. n The OII is a public information and trade association representing insurance companies and agent groups for the property/casualty insurance industry. A primary objective of the OII is to help Ohioans achieve a better understanding of insurance and related safety issues.

How to reach OII n Phone: n Fax: n n n US Mail: –OHIO INSURANCE INSTITUTE –P.O. Box 816 –Columbus, OH