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Risk, Responsibility, Reality

This video clip provides an overview of insurance
policies
Risk, Responsibility, Reality Video Clip

http://www.griffithfoundation.org/auto-insurance/autoinsurance-30-minutes/

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 1
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Insurance
Take Charge of Your Finances
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© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

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Risk

Risk is the uncertainty about a situation’s outcome

This can be an unpredictable event which leads to loss
or damage

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 3
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Insurance Terminology

Insurance is an arrangement between an individual
(consumer) and an insurer (insurance company) to
protect the individual against risk
A policy is a contract between the individual and the
insurer specifying the terms of the insurance
arrangements

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 4
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Insurance Terminology

A policyholder is a consumer who purchases the
policy
A premium is a fee paid to the insurer to be covered
under specified terms
A deductible is the amount paid out of pocket by the
policy holder for the initial portion of a loss before
the insurance coverage begins
© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 5
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Types of Insurance

Types of insurance can include:




Automobile
Health
Life
Disability
Homeowners/Renters

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 6
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Automobile Insurance

Automobile Insurance is an arrangement between an
individual (consumer) and insurer (insurance
company) to protect the individual against risk from
automobile accidents

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 7
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Automobile Insurance Types

There are four types of coverage for Automobile
Insurance:



Liability insurance
Medical payment insurance
Uninsured or underinsured motorists insurance
Physical damage insurance

Collision
Comprehensive
© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 8
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Liability Insurance

Liability Insurance covers the insured if injuries or
damages are caused to other people or their
property

It is the minimum amount of insurance required by law
for automobiles

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 9
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Medical Payment insurance

Medical Payment Insurance covers injuries
sustained by the driver of the insured vehicle or
any passenger regardless of fault

It also covers family members injured as passengers or
if injured as a pedestrian

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 10
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Uninsured motorists insurance

Uninsured or Underinsured Motorists Insurance
covers injury or damage to the driver, passengers, or
the vehicle caused by a driver with insufficient
insurance

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 11
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Physical damage insurance

Physical Damage Insurance covers damages caused to
the vehicle

Collision – covers a collision with another object, car, or
from a rollover
Comprehensive – covers all physical damage losses except
collision and other specified losses

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 12
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Health Insurance

In 2008 there were more than 43 million Americans or 14
percent of the population without health insurance
(http://www.cdc.gov/nchs/hdi.htm)

Health insurance provides protection against financial losses
resulting from injury, illness, and disability

Health insurance may cover hospital, surgical, dental, vision, longterm care, prescription, or other major expenditures
Health insurance may be purchased by the individual or through
their employer

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 13
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Life Insurance

Life insurance is a contract between an insurer and
policyholder specifying a sum to be paid to a
beneficiary upon the insured’s death
The contract is a policy which states the amount to
be paid to the beneficiary upon the insured person’s
death

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 14
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Life Insurance

A beneficiary is the recipient of any policy proceeds if
the insured person dies
A dependent is a person who relies on someone else
financially

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 15
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

You hit and injure a pedestrian in a crosswalk

Automobile!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 16
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

After losing her husband to a heart attack, the wife is
left alone to care for 2 children

Life!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 17
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

You need a cast after breaking an ankle while rollerblading

Health!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 18
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Disability Insurance

Disability Insurance replaces a portion of one’s income
if they become unable to work due to illness or injury

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 19
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Homeowner’s/Renter’s Insurance

Homeowner’s Insurance combines property
and liability insurance into one policy to
protect a home from damage costs due to
perils.
A peril is an event which can cause a financial
loss like fire, falling trees, lightning and others

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 20
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Property Insurance

Property Insurance protects the insured from financial
losses due to destruction or damage to property or
possessions
Liability Insurance protects the insured party from
being held liable for other’s financial losses
Homeowner’s insurance should cover the replacement
cost which will pay to rebuild the home if it is
completely destroyed
© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 21
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Renter’s Insurance

Renter’s Insurance protects the insured from loss of
the contents of the dwelling rather than the dwelling
itself
Renter’s insurance may be provided by a parent or
guardian while an individual is still a full time student
or under the age of 18

However, each policy is different and should be inspected
by the policy holder
© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 22
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

Your apartment is broken into and your computer is
stolen

Renters!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 23
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

You are injured in an automobile accident and are
unable to work for 2 months

Disability!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 24
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

Your garage was destroyed by a fire which started by a
lightning bolt hitting your home

Homeowners!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 25
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Conclusion

Review the following terms and concepts:





Risk
Insurance
Policy
Policyholder
Premium
Deductible
Types of Insurance
© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 26
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

Sick at home from food poisoning after eating a
carnival corndog

Nothing!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 27
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

You have brake failure. You hit a telephone pole
and cause damage to the front of the car

Automobile!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 28
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

You get pulled over and receive a speeding ticket on
your way to the mall

Nothing!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 29
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

A daughter, who is financially responsible for her
mother’s nursing home bills, dies from an undetected
heart defect
Life!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 30
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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What Covers This Risk?

A doctor diagnoses a child with tonsillitis during a
visit to a clinic

Health!

© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 31
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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KWL Chart

Reference the W column on your worksheet

Can you answer those questions now based upon the
content?
If so, what are the answers?

Were there any questions you were unable to answer from
the video?

Record the new information in the L column

If not, what additional questions do you have?
© Family Economics & Financial Education – Updated January 2009 – Insurance Unit – Types of Insurance – Slide 32
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona