Auto insurance basicsfor teen drivers

You’ll learn …

• How insurance works, why you need it• How to keep auto insurance rates down• Types of auto insurance coverage

How does insurance work?

• People pool money to guard against risk• The money pool pays for big losses• Insurance is not an investment• Where does $ go if you have no claim?• People with higher risk pay more

How to keep insurance rates down

• Good grades (3.0 and up) help the most• The type of car does matter• Drive safely – avoid tickets, accidents• Do not phone or text while driving• Take advantage of discounts

How to keep insurance ratesdown

• Speeding tickets are a good predictor of future accidents

• With each ticket you get, the likelihood of a future accident increases

• You pay higher premiums if you have tickets and accident

Auto policy coverages:Collision

• Covers YOUR car

- regardless of fault- when your car hits another object,

gets hit, or overturns- a ‘deductible’ applies

Auto policy coverages:Comprehensive

• Required if you have a loan• May not be needed on older, lower-

valued cars• Covers vandalism, theft, acts of nature

(weather, fire, etc.)

• All cars require Comprehensive and Collision coverage.

FALSE. If there’s no loan, Comp and Collision may not be needed on older, lower-value cars.

What do you think?True or false:

Auto policy coverages:Bodily Injury Liability

• Covers YOU for injury you cause to someone else – injury for which you are found liable

• Required by law

Auto policy coverages:Property Damage Liability

• Covers YOU for damage you cause to someone else’s property, damage for which you’re found liable

• Required by law

Auto policy coverages:Underinsured Motorist

Bodily Injury

• Insurance is required by law• 20-35% of drivers don’t carry any

insurance• Others carry only low limits

Underinsured MotoristBodily Injury

• Protects YOU if someone without enough insurance injures you

- medical costs

- lost wages

- pain and suffering

Auto policy coverages: Underinsured Motorist

Property Damage• Protects YOU if someone without any or

enough insurance damages your car

Auto policy coverages:Personal Injury Protection

• Protects YOU regardless of who is at fault in accident

• Medical coverage – fills gaps in standard medical plans

• Replaces income while you can’t work

Want to learn more?

That’s just a tiny sample of our full presentation.

To learn more, schedule a speaker from PEMCO to come speak to your class or PTSA.

We can accommodate most requests in the Puget Sound area, and some requests statewide.

Contact: jonosterberg@pemco.com

The most important piece of safety equipment in any vehicle is the one behind the wheel.