Insurance Are you ready for an accident? Senior Advisory – May 4, 2015

Why have insurance? As a class brainstorm: Why should you have insurance? What types of insurance will you have in your young adult life? How does insurance work? Do you think everyone should have insurance? *****Don’t forget the many types of insurance.

Insurance Basics Insurance Premium – payment you make in exchange for protection Deductible – loss you pay before insurance kicks in

Auto Insurance California LAW requires basic Auto Coverage Types of Coverage Liability - bodily injury and damages to property (other people) Medical – protects you and those in your car Uninsured motorist – for those who are hit by someone with no insurance Underinsured motorist – if the other person doesn’t have enough to cover you Collision – protection for colliding with other vehicle or object Comprehensive – damages caused by theft, hail, flood, vandalism, etc

Shopping for Coverage Factors Age Gender Marital Status Type of Car Cost of Repairs Mileage Location (where you live) Driving Record Don’t just go for the lowest price Shop around Check reliability of company

Example: You pay $125 a month for auto insurance. You have full coverage with a $500 deductible. Someone runs a stop sign and takes out the corner of your car - $2500 damage – no insurance. Your car will be fixed after you pay the $500 deductible.

Health Insurance Share the risk of injury or illness Basic Health Coverage – includes medical, hospital and surgical Major Medical Coverage – protection against catastrophic expenses of a serious injury or illness (is beyond basic coverage).

Health Insurance Cont. Premium and deductible like auto Co-payment = A payment made by an individual who has health insurance, usually at the time a service is received, to offset some of the cost of care.

Health Example You have health insurance through your employer. You have a $25 co-pay for an office visit. You go to the doctor for a sore throat. You pay $25.00.

Dental and Vision Could be covered under medical or separate May have co-pays and/or deductibles Usually has maximum payable amounts

Renter’s Insurance When you rent you don’t have to worry about the physical building in which you live But your property inside is important! Personal Property – if damage from fire, smoke, water, etc. insurance will help replace or repair. Liability – if someone is injured while in your rented home, you are liable for expenses.

Homeowner’s Insurance Three types of risk: Hazard – fire, water, wind and smoke damage Crimes – criminal activity, such as robbery, burglary, arson and vandalism Liability – the cost of another person’s losses for injuries at your property

Disability Insurance An insurance plan that makes regular payments to replace income lost when illness or injury prevents the insured from working. Commonly called – income protection

Life Insurance This provides funds to the beneficiaries when the insured person dies. Meant to provide financial support when the wage earner may not be there.

REVISIT - Why have insurance? As a class brainstorm: Why should you have insurance? What types of insurance will you have in your young adult life? How does insurance work? Do you think everyone should have insurance? *****Don’t forget the many types of insurance.