Topic 1 Insuring Vehicle Topic 2 Purchasing Vehicle

1. INSURANCE Topic 1 Insuring Vehicle Topic 2 Purchasing Vehicle

2. Insuring a Car • State law requires you to have car insurance. • If you still owe money on your car, your lender can require insurance.

3. PA Auto Insurance • You must show Proof of Financial Responsibility when you: • Are asked for it by a police officer • Have a collision • Register your car or renew its plates • Obtain or renew a driver license • Get your car inspected

4. PENNSYLVANIA AUTO INSURANCE • Required Minimum Coverage • Bodily Injury • $15,000 per person • $30,000 per accident • Property Damage- $5000 • Medical Payments-$5,000

5. Bodily Injury Coverage • Pays: • Other people’s medical expenses • Covers: • 15 per person • 30 per accident • If medical expenses are more, you pay! • Required? • Yes, by State law

6. Property Damage • PAYS • for ALL property damaged that occurred • Covers • 5,000 if you were found to be at fault • Required • Yes, by State Law

7. Medical Payments Coverage • Pays: • Medical- 5,000 • Funeral expenses • Covers: • You • Your family • Your passengers • Required? • Yes, required by State law

8. State Personal Auto Policy • Eight Types of Coverage -Personal Injury Protection/Wage Loss • Uninsured • Underinsured Motorist • Collision • Comprehensive • Towing & Labor • Rental Reimbursement

9. Personal Injury Protection (PIP)Coverage • Pays: • Medical expenses • Funeral expenses- $2,500 • Lost wages- $1,000 a month Max • Homemaker/caregiver services • Covers: • You • Your family • Your passengers • Required? • Not by State law, but company must offer

10. Uninsured/Underinsured Motorist (UM/UIM) Coverage • Pays:$15,000/$30,000 • Medical expenses • Funeral expenses • Car repairs • Car rental • Replacement of damaged contents • Covers: • You • Your family • Your passengers • Required? • Not by State law, but company must offer

11. Collision Coverage • Pays: • Your car repair • Your car replacement • Actual Cash Value • Covers: • Your car • Regardless of driver • Deductible-$250/$500 • Required? • Not by State law, but by car loan lenders

12. Comprehensive Coverage • Pays: • Car repair or replacement after • Fire,theft or other non-collision event Deductible up to 1,000 RATES DON’T GO UP • rental car after theft • Covers: • Your car • Required? • Not by State law, but by car loan lenders

13. Towing & Labor Coverage • Pays: • Towing • Labor charges • When your car is disabled • Covers: • Your car • Required? • Not required by State law

14. Rental Reimbursement Coverage • Pays: • A rental car • Your car is undergoing repair • For covered damage • Covers: • You • Your family members • Required? • Not required by State law

15. Insurance Costs • How car rates are determined • Factors used in establishing rates • Discounts • Mandatory • Non-mandatory

16. Insurance Costs Factors Used to Determine Your Premium • Drivers Characteristics • Your age and marital status • Highest rates • Male and female drivers under 25 • Unisex state • Driving Record • Years Licensed • Policy Holder

17. Make & Model- VIN NUMBER County where you keep your car Urban counties have more accidents and auto thefts; tending to be higher than those of rural areas Your car Age Safety features Collision and comprehensive rates Highest for luxury, high-performance, and sports cars Higher for cars that damage easily Higher for cars that cost more to repair Insurance Costs

18. Insurance Costs • Factors used to determine your individual premium • Your deductibles • Your share of the cost of a collision or comprehensive claim • Reduce your premium by raising your deductibles • Surcharges • Added for collisions resulting in property damage of $1,000 or more • Discounts • Some required by the state, while others are optional with companies • Mutuals are not required to give any discounts

19. Auto Insurance Discounts Savings Defensive driving and driver education courses for young drivers Airbags and other passive restraints Good Student Anti-theft devices Two or more cars on a policy 10 percent off Liability, Collision Medical Payments, and PIP 15 percent off Medical Payments and PIP (driver’s side) 30 percent off Medical Payments and PIP (both sides) 5 percent off Liability, Collision, Medical Payments, and PIP Reduces Comprehensive premium; amount varies by device and county 20 percent off Liability, Medical Payments, and PIP 15 percent off Collision Premium Discounts • Education and Car Equipment Saves

20. Premium Discounts • Companies may giveoptional discounts for: • Your age and annual mileage driven • Policy renewal, with a good claims and driving recordanti-lock brakes • A parent or family whose young driver is away at school without a car • Full-time college and high school students with a "B" or 3.0 average • Cars with automatic daytime running lights • Membership or adult leadership in certain youth organizations.

21. "High Risk" Drivers • Each company has its own rules • called "underwriting guidelines" • for deciding whether to insure people • Makes it harder to get car insurance • Must pay higher premiums • Insurance for high risk drivers • Surcharges

22. Surcharge * Accident or Violation (Premium Cost will increase by) 15% 35% 60% 0% 60% 60% 60% 35% One collision (at-fault) in 36 months Two collisions Three collisions Each moving violation (speeding, etc.) Involuntary manslaughter Driving under the influence Criminally negligent driving No license, or license suspension * Surcharges for most drivers are percentages of the rates in your county for liability, collision, PIP, and medical payments coverage. "High Risk" Drivers • Your Driving Record Will Cost You

23. Buying a Car • New or Used? • What Do I Need It To Do? • What Safety Features Are Needed? • How Much Will It Cost? • How Economical Is It? • What Options Do I Need?

24. Your Monthly Payment • PriceFormula Vehicle Price Purchase Price x Interest Rate x Length of Finance Purchase Price - $12,000 Interest Rate - 7 percent Length of Finance - 48 months Purchase Price + Interest+ Sales Taxes = Total Price over 16,000.00 • What is the Monthly Payment?