VEHICLE INSURANCEChapter 14, 14-2

AB

OU

T T

HE R

ISK

S

All states have a financial responsibility law. This means you will be held responsible for damage you cause to other people and their property. This may be satisfied through the suspension of your license, and the possession of your property and savings.

CO

MP

ULS

OR

Y IN

SU

RA

NC

E

Some states require you have a minimum amount of insurance to obtain a license.

PER

SO

NA

L IN

JUR

Y C

OV

ER

AG

E—

BO

DILY

IN

JUR

Y

Includes:

bodily injury (protects your from claims of injury or death when you are at fault).

Covers people in other cars and pedestrians.

Expressed as a fraction, numbers show limit insurance will pay out to one person, and maximum of total claim in thousands of dollars.

Ex. 100/300

Medical Payments Protection (covers injury to policy holder and family) no matter who is at fault.

Uninsured Motorist Protection (protects policyholder if person at fault has no insurance.

There is also underinsured motorist coverage.

PR

OP

ER

TY

DA

MA

GE C

OV

ER

AG

E

Property damage liability covers you if you damage someone else’s property (usually the other person’s car).

Does not cover damage to your own car.

Collision insurance protects against financial loss from a collision.

Often comes with a deductible

Comprehensive coverage covers loss from things like fire, flood, theft or vandalism.

NO

FAU

LT IN

SU

RA

NC

E L

AW

S

This means regardless of who is at fault, you collect from your own insurance company.

This speeds up the claim process and reduces the cost of insurance.

INSURANCE RATES—FACTORS THAT AFFECT WHAT YOU PAY

Age Accident record Marital status Academic standing Credit rating Purpose of vehicle Number of miles driven Value and type of car Community you live in Amount of coverage and deductibles

RED

UC

ING

YO

UR

INS

UR

AN

CE C

OS

TS

Things that could help:

taking a drivers ed course good grades good driving record using same company and plan as parents