Automobile Automobile InsuranceInsurance

Insurance BasicsInsurance Basics

for Studentsfor Students

Evaluating Your Insurance Evaluating Your Insurance NeedsNeeds Auto InsuranceAuto Insurance

– Parts of an auto policyParts of an auto policy– Auto insurance cost factorsAuto insurance cost factors– Teen crashesTeen crashes– Auto insurance laws in OhioAuto insurance laws in Ohio

– Financial Responsibility lawFinancial Responsibility law– Graduated Licensing lawGraduated Licensing law

– Your insurance needsYour insurance needs– Shopping for InsuranceShopping for Insurance– Cost saving tipsCost saving tips– Tips for settling an insurance claimTips for settling an insurance claim

Parts of an Auto Insurance Parts of an Auto Insurance PolicyPolicy

DeclarationsDeclarations Your InformationYour Information

– Who’s insured (name and address)Who’s insured (name and address)– Vehicle(s) covered (V.I.N.)Vehicle(s) covered (V.I.N.)

Your policy specificsYour policy specifics– Amount of insurance - Policy LimitsAmount of insurance - Policy Limits– Premium (the price of insurance coverage) Premium (the price of insurance coverage)

Parts of an Auto Insurance Parts of an Auto Insurance PolicyPolicy

CoveragesCoverages Bodily Injury LiabilityBodily Injury Liability Property Damage LiabilityProperty Damage Liability Medical PaymentsMedical Payments Uninsured MotoristsUninsured Motorists Underinsured MotoristsUnderinsured Motorists Uninsured Motorists Property DamageUninsured Motorists Property Damage Damage to Your AutoDamage to Your Auto

– CollisionCollision– Other Than Collision (Comprehensive)Other Than Collision (Comprehensive)

Parts of an Auto Insurance Parts of an Auto Insurance PolicyPolicy

DefinitionsDefinitions– Terms of policy definedTerms of policy defined

ExclusionsExclusions– What’s Not Covered in the policyWhat’s Not Covered in the policy

ConditionsConditions– Responsibilities of the contract are Responsibilities of the contract are

specified for you and the companyspecified for you and the company

Auto Insurance Cost Auto Insurance Cost FactorsFactors

Factors that determine cost of insuranceFactors that determine cost of insurance Use of car (to & from work, pleasure)Use of car (to & from work, pleasure) Value / Type of car (make & model)Value / Type of car (make & model) Repair costs for car & occupants Repair costs for car & occupants

(crashworthiness)(crashworthiness) Where you live and how car is parkedWhere you live and how car is parked Your driving recordYour driving record Coverage limitsCoverage limits Sex & Marital statusSex & Marital status Good Student DiscountGood Student Discount Age of driversAge of drivers

1 Licensed driver statistics as of June 6, 20012 Ratio reflects the chance for involvement in a crash3 Includes drivers under 16 years of age and drivers with age-not-stated involved in crashes

NA = Not applicableSources: Ohio Department of Public Safety 2000 Ohio Traffic Crash Facts and 2000 Ohio License Statistics by County, Age and Sex

Teen CrashesTeen Crashes Top contributors to teen crashesTop contributors to teen crashes

InexperienceInexperience SpeedingSpeeding Passengers / DistractionsPassengers / Distractions Night driving / Road conditions / WeatherNight driving / Road conditions / Weather Low safety belt useLow safety belt use

John Hopkins University study -2000John Hopkins University study -2000 16 yr. old drivers - higher risk of dying behind the wheel16 yr. old drivers - higher risk of dying behind the wheel

– 39% higher with the addition of 1 passenger39% higher with the addition of 1 passenger– 86% higher with 2 passengers86% higher with 2 passengers– 182% higher with 3 or more passengers182% higher with 3 or more passengers

Auto Insurance LawsAuto Insurance Laws Ohio’s Financial Responsibility lawOhio’s Financial Responsibility law

Requirements met by having one of the Requirements met by having one of the following:following:

– Auto Liability insurance (12,500/25,000 BI; Auto Liability insurance (12,500/25,000 BI; 7,500 PD)7,500 PD)

– Surety bond of $30,000Surety bond of $30,000– BMV Certificate - bond of $30,000 on file with BMV Certificate - bond of $30,000 on file with

BMVBMV– BMV Certificate - bond of $60,000 in real BMV Certificate - bond of $60,000 in real

estate on fileestate on file– Certificate of Self Insurance - those w/ 25 or Certificate of Self Insurance - those w/ 25 or

more carsmore cars

Auto Insurance LawsAuto Insurance Laws Ohio’s Financial Responsibility lawOhio’s Financial Responsibility law

Required to show proof of FR when:Required to show proof of FR when:– A moving violation requires a court appearanceA moving violation requires a court appearance– When stopped by law enforcement officials for When stopped by law enforcement officials for

a traffic violation, vehicle safety inspection or a traffic violation, vehicle safety inspection or involved in a crash and asked to provide itinvolved in a crash and asked to provide it

– Contacted via mail through the BMV random Contacted via mail through the BMV random verification programverification program

Auto insurers provide an Auto Insurance Auto insurers provide an Auto Insurance ID CardID Card

– Keep it in car - satisfies FR proof when asked Keep it in car - satisfies FR proof when asked by law enforcement officialsby law enforcement officials

Auto Insurance LawsAuto Insurance Laws Financial Responsibility law PenaltiesFinancial Responsibility law Penalties

Lose Drivers License @ least 30 days, up to one Lose Drivers License @ least 30 days, up to one yearyear

No driving privileges during suspensionNo driving privileges during suspension License plate & vehicle registration suspensionLicense plate & vehicle registration suspension License reinstatement fees of $75-$500License reinstatement fees of $75-$500 Requirement to obtain insurance for five years - Requirement to obtain insurance for five years -

monitored by insurers and BMVmonitored by insurers and BMV Vehicle immobilization and confiscation of Vehicle immobilization and confiscation of

license plates for violation FR suspensionlicense plates for violation FR suspension– 3rd and subsequent offenses - could mean vehicle 3rd and subsequent offenses - could mean vehicle

forfeiture + 5-year moratorium on vehicle forfeiture + 5-year moratorium on vehicle registrationsregistrations

Auto Insurance LawsAuto Insurance Laws Ohio’s Graduated Licensing lawOhio’s Graduated Licensing law

Temporary permits can be obtained at 15 1/2Temporary permits can be obtained at 15 1/2– Drivers training componentDrivers training component

Drivers Education TrainingDrivers Education Training Plus 50 hours behind the wheel with Mom & DadPlus 50 hours behind the wheel with Mom & Dad

Probationary drivers licenseProbationary drivers license– At least 16 years oldAt least 16 years old– Must pass BMV driving and maneuverability testMust pass BMV driving and maneuverability test– Probationary license held until 18 when full Probationary license held until 18 when full

privileges without restrictions grantedprivileges without restrictions granted Curfew restrictions & penalties applyCurfew restrictions & penalties apply

– Driving under the influenceDriving under the influence– Moving violationsMoving violations

Your Insurance NeedsYour Insurance Needs Shopping for insuranceShopping for insurance

Agent, toll-free numbers, internetAgent, toll-free numbers, internet– Have agent/company representative explain what’s NOT Have agent/company representative explain what’s NOT

COVERED in the policy - this avoids surprises after a lossCOVERED in the policy - this avoids surprises after a loss– Many prefer to investigate coverage options and prices Many prefer to investigate coverage options and prices

via the web, then contact an agent or companyvia the web, then contact an agent or company Evaluate your need for an agent - is it important to Evaluate your need for an agent - is it important to

you to have an insurance professional for advice? you to have an insurance professional for advice?

Insurance premiumsInsurance premiums Paid monthly, quarterly, semiannually, or yearlyPaid monthly, quarterly, semiannually, or yearly Homeowners - watch for PITI in your mortgageHomeowners - watch for PITI in your mortgage

– Principal, Interest, Taxes, InsurancePrincipal, Interest, Taxes, Insurance

Your Insurance NeedsYour Insurance Needs Insurance cost saving tipsInsurance cost saving tips

Ask about discountsAsk about discounts Good student, more than one car, carrying other Good student, more than one car, carrying other

types of insurance with the same companytypes of insurance with the same company Increase deductiblesIncrease deductibles

Generally, the higher the deductible, the lower Generally, the higher the deductible, the lower the premiumthe premium

Avoid filing frivolous and/or excessive claimsAvoid filing frivolous and/or excessive claims Comparison shopComparison shop Keep property (car and home) well maintainedKeep property (car and home) well maintained

Your Insurance NeedsYour Insurance Needs Settling an insurance claimSettling an insurance claim

Contact insurance agent/company ASAPContact insurance agent/company ASAP Take steps to prevent future losses to propertyTake steps to prevent future losses to property Gather as much info as possible about the lossGather as much info as possible about the loss

– witnesses, videotape/photo damaged propertywitnesses, videotape/photo damaged property An insurance company representative will contact An insurance company representative will contact

you (claims adjuster) asking details about the lossyou (claims adjuster) asking details about the loss– Adjuster may want to record your conversationAdjuster may want to record your conversation

Work with adjuster to an agreeable negotiationWork with adjuster to an agreeable negotiation– If not satisfied, you have the option to contact Ohio If not satisfied, you have the option to contact Ohio

Dept. of Insurance - Consumer Services Division - for Dept. of Insurance - Consumer Services Division - for info or to file a complaint info or to file a complaint (www.ohioinsurance.gov)(www.ohioinsurance.gov)

OII Mission StatementOII Mission Statement To strengthen public understanding of To strengthen public understanding of

and confidence in Ohio’s and confidence in Ohio’s property/casualty insurance industry.property/casualty insurance industry.

The OII is a public information and trade The OII is a public information and trade association representing insurance companies association representing insurance companies and agent groups for the property/casualty and agent groups for the property/casualty insurance industry. A primary objective of the insurance industry. A primary objective of the OII is to help Ohioans achieve a better OII is to help Ohioans achieve a better understanding of insurance and related safety understanding of insurance and related safety issues.issues.

How to reach OIIHow to reach OII Phone: 614.228.1593Phone: 614.228.1593 Fax: 614.228.1678Fax: 614.228.1678 Email: info@ohioinsurance.orgEmail: info@ohioinsurance.org www.ohioinsurance.orgwww.ohioinsurance.org US Mail: US Mail:

– OHIO INSURANCE INSTITUTEOHIO INSURANCE INSTITUTE– P.O. Box 816P.O. Box 816– Columbus, OH 43216-0816Columbus, OH 43216-0816