Section 1 (Day 4) Virginia Driver Responsibilities: Licensing Responsibilities

Section 1(Day 4)

Virginia Driver Responsibilities:

Licensing Responsibilities

Bell RingerWrite a half page red to red. Save these to be turned in with your test!

Worth 10% of your grade.

•Come up with your own right of way scenario.•Draw the scenario and explain what is going on.

Examples of questions to answer:

Which car arrived first?

What type of intersection are the cars in?

Day 4 Objectives

The students will learn the steps to take in order to buy a car.The students will learn the steps to take in order to buy a car.The students will learn about insurance.The students will learn about insurance.The students will understand the different types of insurance.The students will understand the different types of insurance.

Related SOL: DE.Related SOL: DE.1919

This is what you are trying to get at the end of class..This is what you are trying to get at the end of class..

Spotswood High School

R.C.P.S

36

x

12/18/2012

Your Name Here

“Green Card”

How to buy a car: How to buy a car:

Vehicle Price FormulaVehicle Price Formula

Purchase Price x Interest Rate x Length of FinancePurchase Price x Interest Rate x Length of Finance

Purchase Price - Purchase Price - $10,000$10,000 Interest Rate - Interest Rate - 8 percent8 percent Length of FinanceLength of Finance - - 24 months24 months

Purchase Price + Sales Taxes + Interest Purchase Price + Sales Taxes + Interest = Total Price Approximately 11,592.00= Total Price Approximately 11,592.00

Your Monthly PaymentYour Monthly Payment

What is your monthly payment?What is your monthly payment?

Vehicle Price Monthly Payment FormulaVehicle Price Monthly Payment Formula

Your Monthly PaymentYour Monthly Payment

Price + taxes + interest

# of months= Monthly payment

Cost of Vehicle $10,000.00Cost of Vehicle $10,000.00

3.5% Titling Tax3.5% Titling Tax

8% Interest on Loan (based on unpaid balance)8% Interest on Loan (based on unpaid balance)

Loan is over 24 Months.Loan is over 24 Months.

$10,000.00 +$350.00 +$1200.00*

24= $481.25$481.25

*1st year interest = $10,000 x .08 = $800

*2nd year interest = $5,000 x .08 = $400

Buying A CarBuying A Car Before buying

a car, you have to decide whether or not you want to buy a new car or a used car.

The benefits and The benefits and drawbacks of buying new drawbacks of buying new

and used carsand used cars

Car Benefits Drawbacks

New The car has never been in a wreck, never been smoked in, and hasn’t had any past maintenance. You can also customize your car to fit your personal needs. You can also get customer cash or cash rebates on new cars.

The car’s cost. When you drive the car off the lot it automatically looses cost if you want to sell it because the car is now a used car.

Used Costs less. You have to do extra research to learn the vehicles history. Could have been smoked in, wrecked, or stripped for parts.

Five things you should know 1. The invoice price is how much the dealer paid for the car. The dealer's

final cost may be even lower because manufactures often give rebates, allowances, and other incentive awards.

2. Dealers may be willing to bargain on their profit margin, which is generally between 10 percent and 20 percent.

3. Don't discuss the possibility of a trade-in until you get the best possible pricefor your new car.

4. Before buying a service contract, compare it with the manufacturer's warranty.

Don't pay extra for coverage you may already have. 5. Buying credit insurance is not required for a loan.

www.ican.com/news/fullpage.cfm/articleid/259F8679-8B66-4659-91E5AB37BCC0490B/cx/auto.find_vehicle/article.cfm

Buying a new carBuying a new car

When buying any new car you should consider these five tips.

Buying a used carBuying a used car When buying a used car

it is advised to do some research on the car you want to buy.

It is helpful to know the number of previous owners, the history of the car, for instance, if the car was involved in some sort of accident, any old mechanical problems, and any maintenance that was done on the car.

How to find the history of How to find the history of your caryour car

To find the history of yours, or any car, you can go online to many different websites such as CARFAX.com, cars.com, usedcars.com...etc.

You can also ask the dealership for information regarding your car.

VIN: 1HGED3649KA081343 Year/Make/Model: 1989 HONDA CIVIC DX Body Style: Sedan 4 DR Engine Type: 1.5L L4 FI Manufactured In: UNITED STATES Search Results: 4 records found in our database

IMPORTANT! The 4 records on this 1989 HONDA CIVIC DX will confirm a clean history or uncover potential problems. Find out by ordering the complete CARFAX Vehicle History Report.

Example from CARFAX.comExample from CARFAX.com

Places to buy a carPlaces to buy a car You can buy a car at a new/used car dealership,

a superstore dealership, websites, print classifieds, or person-to-person transactions.

The benefits of buying a car from a dealership or a website is that most of them are required to give a complete and accurate vehicle history report.

You can’t always trust person-to-person transactions because it’s easy to lie and say that the car wasn’t ever in an accident when it could very easily have been a salvage vehicle.

When Buying a CarWhen Buying a Car Have the mechanic

give the car a full inspection

Run a vehicle history report to get a full history of the car

Avoid “as is” statements

Have your finance and loan approvals ready before you even go to the dealership

Warranty OptionsWarranty Options

TotalCare ALL COMPONENTS AND PARTS EXCEPT FOR CERTAIN MAINTENANCE RELATED

AND NON- MECHANICAL ITEMS StatedCare

SUSPENSION (FRONT/REAR) STEERING ELECTRICAL SYSTEM HIGH-TECH/CONVENIENCE GROUP

PrimaryCare AIR CONDITIONING HEATING BRAKING SYSTEM FUEL SYSTEM COOLING SYSTEM

PowerCare ENGINE MANUAL TRANSMISSION/TRANSFER CASE AUTOMATIC TRANSMISSION/TRANSFER CASE

VIN NumbersVIN Numbers The VIN number is your Vehicle

Identification Number. A VIN number is your cars serial

number. Your cars VIN number is located at

the bottom left side of the dash (left from the inside)

VIN #

Using the Internet to search Using the Internet to search for carsfor cars

Lets say that I wanted to buy a VW Beetle off the internet. What sites would I visit and what information would I need to know to help me buy this car?

VW Beetle Internet VW Beetle Internet ResearchResearch

Go to Autotraders.com (just a suggestion) Select “Used Car” Select “Find your

Car” Enter the type of

car that you are searching for

Select “Next”

Enter the type of car, model year, price range, zip code, and select a mile radius to search in

Scroll through the cars found in your search

Available at:

Crown Auto Sales

Orange, VA 22960

Contact: David Watson

Toll Free 1-800-442-2769

Distance from ZIP 22801: 50 milesComments: One owner gls,automatic, most power options,factory power sunroof,keyless entry,alloy wheels,best color, excellent miles,serviced and state inspected ready for your inspection please call 1-800-442-2769

Options Installed: Driver Air Bag; Anti-Lock Brakes; Air Conditioning; Alloy Wheels; Cruise Control; Passenger Air Bag; Rear Window Defroster; Power Door Locks; Power Mirrors; Power Windows; Power Steering; Sunroof/Moonroof; Tinted Glass; Tilt Wheel;

2000 Volkswagen Beetle GLS $11995

This Car's Details

Price $11995 Mileage 31078

Exterior Color: Silver Interior Color: Charcoal

Body Style Hatchback Doors Two Door

Engine 4 Cylinder Gasoline Trans. Automatic

Stereo AM/FM Stereo Tape Fuel Type Gasoline

Drive Type 2 wheel drive Stock No. 6587

VIN 3VWCC21C0YM458717

All advertised prices exclude government fees and taxes, any finance charges, any dealer document preparation charge, and any emission testing charge.Auto information is based in part on data supplied by IntelliChoice. Please refer to our Visitor Agreement for further information on vehicle data.By using this service, you accept the terms of our Visitor Agreement. A few words of caution about buying a pre-owned car.©2001 AutoTrader.com L.L.C.

VW Beetle VW Beetle Internet ResearchInternet Research

What To Know Before You What To Know Before You GoGo

The first thing that you have to do before going out to buy a car is to check your budget, your credit history, and your vehicle needs (Four-wheels drive, handicap entrance, towing, gas mileage, size,...etc.)

You can check your credit history online at Freecreditreport.com, or at your bank

Hidden Costs: Any market adjustment prices, taxes- 3% VA sales tax, .2% dealer business license tax; DMV fees- $29.50 plate fee, $10.00 title fee, $10.00 DMV processing fee; $95.00 dealer processing fee

Price DifferencesPrice DifferencesMazda RX8Grand TouringPackage

Price

Average Price $31,100Dealer Price $28,700Sticker Price $31,100

27,00028,00029,00030,00031,00032,000

Price

Mazda RX8 Grand Touring Package

Average PriceDealer PriceSticker Price

Average Price- The standard price for the most commonly bought package or option for the car

Dealer Price- What the dealership paid for the car

Sticker Price- What the dealership asks for the car

Price DifferencesPrice Differences

Finding Out About CarsFinding Out About Cars You can find out about cars by

reading magazines, and by doing research online.

You can also learn about cars by asking your family, friends, co-workers, and neighbors.

Getting The Best PriceGetting The Best Price

What makes most buyers nervous is having to negotiate for a more beneficial to them

When buying a car, never be afraid of negotiating

LemonsLemons Once you’ve made your decision, you

need to know what to do with your new car if you have any problems

If you feel that you’ve been sold a lemon, you do have recourse Recourse- The right to demand that the

dealership that gave you your car reimburse you, whether it be with money, or with a new car

Helpful HintsHelpful Hints Be Realistic- dealerships often see

people come in expecting to buy a car, and then not being able to afford it

Never Accept The First Offer Do Your Homework- Know what you

want Be Prepared To Put Money Down

Insurance

What is auto insurance?

Auto insurance protects you against financial loss if you have an accident.

It is a contract between you and the insurance company. You agree to pay the premium and the insurance

company agrees to pay your losses as defined in your policy.

Most auto policies are for six months to a year. Your insurance company should notify you by mail when i

t’s time to renew the policy and to pay your premium.

Auto insurance provides

Auto insurance provides property, liability and medical coverage:

Property coverage pays for damage to or theft of your car.

Liability coverage pays for your legal responsibility to others for bodily injury or property damage.

Medical coverage pays for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses.

How much Insurance How much Insurance should you have?should you have?

At a minimum, your insurance must provide the following: $25,000 for injury or

death of one person $50,000 for injury of

two or more people; and

$20,000 for property damage.

If your vehicle is not insured, you must pay a $500.00 uninsured motor vehicle fee.

This does not provide insurance, but allows you to register and operate a vehicle in VA. For 1 year.

Insuring a CarInsuring a Car

VA Law requires you to VA Law requires you to provide proof of financial provide proof of financial responsibilityresponsibility

If you still owe money on If you still owe money on your car, your lender your car, your lender may require collision may require collision insuranceinsurance

Your parentsYour parents’’ policy covers policy covers you while you have a learneryou while you have a learner’’s s permitpermit

Financial Responsibility LawFinancial Responsibility Law

$ Minimum liability coverageMinimum liability coverage

$ Alternatives to insurance coverageAlternatives to insurance coverage

$ Types of proof of financial responsibilityTypes of proof of financial responsibility

$ When you must show proof of financial responsibilityWhen you must show proof of financial responsibility

$ Penalties for driving without insurancePenalties for driving without insurance

Required Minimum Liability Coverage in VARequired Minimum Liability Coverage in VA

$25,000 for bodily injury / death one person$25,000 for bodily injury / death one person

Up to $50,000 for bodily injury / death two or Up to $50,000 for bodily injury / death two or

more personsmore persons

$20,000 for property damage$20,000 for property damage

Virginia Auto InsuranceVirginia Auto Insurance

You must show Proof of You must show Proof of

Financial Responsibility Financial Responsibility

when you:when you:


are asked for it by a police officer;are asked for it by a police officer;

have a collision; orhave a collision; or

register your vehicle or renew its plates.register your vehicle or renew its plates.


Penalties for Driving without Proof of Penalties for Driving without Proof of Financial ResponsibilityFinancial Responsibility

$500 fine$500 fine

Suspension of your driverSuspension of your driver’’s s licenselicense

Suspension of your vehicle Suspension of your vehicle registrationregistration

Higher insurance premiums Higher insurance premiums for the next 3 years (SR-22)for the next 3 years (SR-22)

If you caused the crash, you If you caused the crash, you are responsible for other are responsible for other peoplepeople’’s lossess losses

Suspended

Suspended


Facts on the Declaration Page of Your PolicyFacts on the Declaration Page of Your Policy

The exact name of your insurance companyThe exact name of your insurance company

The policy numberThe policy number

Your coverage and how much it costsYour coverage and how much it costs

Your deductibles, if anyYour deductibles, if any

The vehicles insured on the policy, their vehicleThe vehicles insured on the policy, their vehicle

identification numbers and their classifications identification numbers and their classifications

for rating purposesfor rating purposes

Virginia Personal Auto PolicyVirginia Personal Auto Policy

Seven Types of CoverageSeven Types of Coverage

LiabilityLiability

Medical PaymentsMedical Payments

Uninsured/Underinsured MotoristUninsured/Underinsured Motorist

CollisionCollision

Comprehensive Comprehensive

Towing and LaborTowing and Labor

Rental ReimbursementRental Reimbursement

Liability CoverageLiability Coverage

Pays:Pays: Other peopleOther people’’s medical s medical

expenses expenses Other peopleOther people’’s auto repairss auto repairs Property damageProperty damage

Covers:Covers: YouYou Your family Your family Others driving with your Others driving with your

permissionpermission

Required?Required? Yes, required by Virginia lawYes, required by Virginia law

Medical Payments CoverageMedical Payments CoveragePays:Pays:

Medical expensesMedical expenses Funeral expensesFuneral expenses

Covers:Covers: YouYou

Your family Your family

Your passengersYour passengers

Required?Required? Not required by Virginia lawNot required by Virginia law

Uninsured/Underinsured Uninsured/Underinsured Motorist (UM/UIM) CoverageMotorist (UM/UIM) Coverage

Pays:Pays: Medical expenses Funeral expenses Car repairs Car rental Replacement of damaged contents

Covers:Covers: (if hit by an uninsured/underinsured or hit-and-run motorist)

You Your family Your passengers

Required?Required? Not by Virginia law, but company must offer

Collision CoverageCollision Coverage

Pays:Pays: Your car repair Your car replacement

Covers:Covers: Your car Regardless of driver or

who was at fault

Required? Required? Not by Virginia law, but

often required by the finance company that loaned you the money to buy the car

Comprehensive CoverageComprehensive Coverage

Pays:Pays:

Car repair or replacement after: fire hailstorm theft or other non-collision event rental car after theft

Covers:Covers: Actual cash value of your car

Required?Required? Not by Virginia law, but often required by

car finance companies

Towing and Labor CoverageTowing and Labor Coverage

Pays:Pays: Towing Towing On site labor charges such as On site labor charges such as

changing a tire changing a tire When your car is disabledWhen your car is disabled

Covers:Covers: Your carYour car

Required?Required? Not required by Virginia lawNot required by Virginia law

Rental Reimbursement CoverageRental Reimbursement Coverage

Pays:Pays: A rental car while your car is being repaired

after a crashafter comprehensive losses

Covers:Covers: YouYour family members

Required?Required?

Not required by Virginia law

Car Rental Company

Insurance CostsInsurance Costs

How are car insurance rates determined?How are car insurance rates determined?

What factors are used in establishing What factors are used in establishing

rates?rates?

Discounts?Discounts?

Insurance CostsInsurance Costs

Factors used to determine your premium:Factors used to determine your premium:

Type of CarType of Car

Highest for luxury, high-performance, and sports carsHigher for cars that damage easilyHigher for cars that cost more to repair

Collision and comprehensive ratesCollision and comprehensive rates

How you use your carHigher for cars driven a lot of miles and used for school, work or business

Your Age, Marital Status, Driving Record, and Grades

Highest RatesHighest RatesMale drivers under 25Unmarried women under 21

Where you live and drive

Urban counties have more crashes and auto thefts so rates tend to be higher than those in rural areas

Insurance CostsInsurance Costs Factors used to determine your individual premium:Factors used to determine your individual premium:

Your DeductiblesYour Deductibles

Your share of the cost of a collision or comprehensive claim

You can reduce your premium by raising your deductibles

SurchargesSurcharges

Penalties added for accidents and certain traffic violations

DiscountsDiscounts

Some are required by the state, while others are incentives offered by insurance companies

Education and Car Equipment Education and Car Equipment SavingsSavings

NOTE: SOME insurance companies offer the following discounts

Premium DiscountsPremium Discounts

Auto Insurance DiscountAuto Insurance Discount SavingsSavings

Defensive driving coursesDefensive driving courses Percent offPercent off Liability, Collision, and Medical Payments

Airbags and other passive Airbags and other passive restraintsrestraints

Percent offPercent off Medical Payments and Bodily Injury

Drug / alcohol educationDrug / alcohol education Percent offPercent off Liability, Collision, Medical Payments, and Bodily Injury

Anti-theft devicesAnti-theft devices May Reduce Comprehensive premium;May Reduce Comprehensive premium; amount varies by device and county

Two or more cars on a policyTwo or more cars on a policy May reduce May reduce Liability, Medical Liability, Medical Payments and Collision Insurance Payments and Collision Insurance costscosts

Some companies may give discounts for:Some companies may give discounts for:• Your age and annual mileage drivenYour age and annual mileage driven• Policy renewal, no claims, good driving Policy renewal, no claims, good driving

record and anti-lock brakesrecord and anti-lock brakes• A parent or family whose young driver is A parent or family whose young driver is

away at school without a caraway at school without a car• Full-time college and high school students Full-time college and high school students

with a "B" or 3.0 grade point averagewith a "B" or 3.0 grade point average• Cars with automatic daytime running lightsCars with automatic daytime running lights• Membership or adult leadership in certain Membership or adult leadership in certain

youth organizationsyouth organizations

Insurance Premium DiscountsInsurance Premium Discounts

High Risk DriversHigh Risk Drivers

High risk drivers (bad driving record)High risk drivers (bad driving record) Each company has its own rules for deciding whether to insure high risk drivers

(Called “underwriting guidelines”) Usually much harder to get car insurance Must pay higher premiums

Assigned-risk driversAssigned-risk drivers VA Auto Insurance Plan—requires all insurance companies to take some

high risk drivers High risk drivers are assigned to an insurance company by the state Surcharges are added for at least 3 years

Your Driving Record May COST YouYour Driving Record May COST You

High Risk DriversHigh Risk Drivers

Crashes or ViolationsCrashes or ViolationsSurchargesSurcharges

Your premium Your premium MAYMAY increase increase by:by:

One collision (at-fault) in 36 months 15%

Two collisions 35%

Three collisions 60%

Each moving violation (speeding, etc.)(Surcharges will apply for certain traffic violations.)

Varies

Involuntary manslaughter 60%

Driving under the influence 60%

Criminally negligent driving 60%

Paying for InsurancePaying for Insurance

Many people can’t afford to pay their car insurance premium in one installment

Insurance companies must offer installment plans

Agents and insurers may use finance companies that will- lend you money at high

interest rates to pay insurance premiums

Look for insurance companies that offer installment plans with low interest and fees

Installment Plan

Number of Months _____

Interest Rate _____%

________________________Client

________________________Company Representative

Installm

ent Plan


Ask the agent: Ask the agent:

Who will provide my installment

plan?- the insurance company, or - a premium finance company

If it is a premium finance company, what is the interest rate?

How much is the down payment? How much is my monthly payment? How many payments do I make? How much is my total payment? (annual or six-month premium plus interest )

INSTALLMENT PLAN WORKSHEETINSTALLMENT PLAN WORKSHEET

Agent or Company Names ______________ ______________

Interest Rate, if any ______________ ______________

Down Payment ______________ ______________

Monthly Payment ______________ ______________

Number of Months ______________ ______________

Total you pay ______________ ______________

Use a worksheet to compare the installment Use a worksheet to compare the installment packages offered by agents and companiespackages offered by agents and companies


Losing Your InsuranceLosing Your Insurance

CancellationCancellationFirst 60 days, company can cancel for any reason, including a ticket or a collisionAfter policy is in effect more than 60 days, can cancel but:

- must give 10 days' notice before canceling- Must refund unearned premium

Note: Cancellation for non-payment is effective immediately.

Non-renewalNon-renewalCompany will not offer a new contract

Request Reasons in WritingRequest Reasons in Writing Why company canceled the policy Why company will not renew the policy

CANCELEDCANCELED

CANCELED

After the CollisionAfter the Collision

What Now?What Now? Discuss what your policy requires you to do after a

collision Your uninsured motorist coverage pays for hit-and-run

collisions only if the crash is reported to the police


Involved in a CrashInvolved in a Crash Stop as close to the scene as possible Check for injuries - make sure your passengers and those

in the other vehicle(s) are OK• if anyone is injured or killed contact police immediately• if no one is injured and your vehicle can be moved, move it from blocking the traffic flow

Notify police Warn oncoming traffic Exchange information

• provide insurance information• obtain information from others involved and witnesses

Notify your insurance company as soon as possible


What should you do when What should you do when you are involved in a you are involved in a crash and have a claim?crash and have a claim?

If the company rejects your claim or pays only part of it, you should be given an explanation for that decision.

Notify your insurance company promptly

Your agent can help you file the claim correctly and completely fill out any forms needed to verify your claim

Keep a copy of the forms for your records

Review for Test

Documents

Section 1 (Day 4) Virginia Driver Responsibilities: Licensing Responsibilities