Insurance & Risk Management

Journal 12/3/2015

What is Insurance? How many different types of Insurance

can you think of? (list as many as you can)

Group Activity

Groups of 4 to 5 5 Minutes - brainstorm every type of risk a

student might face in a typical day (physical, financial, social, etc.).

Examples - a student runs the risk of choking when eating breakfast, being involved in an accident on the way to school, falling down the stairs at school, getting a paper cut when a test is distributed, etc.

Can You Believe?

The number of insurance claims for auto accidents involving teens is ____% higher than those for adults.

Teen crash rates drop by ____% six months after getting their license.

Can You Believe?

In the latest survey available, ____% of the U.S. population experienced some level of disability in a year.

Head injuries cause about ____% of all bicycling fatalities.

Can You Believe?

There is a ____% chance you’ll be involved in an alcohol-related traffic accident at some point in your life.

At work, a disabling injury occurs every ____ seconds.

Can You Believe?

Sixteen-year-old drivers have ____ times the risk of being in a crash compared to 18-year-old drivers.

Risk Management

“In exchange for a relatively small payment, which is the premium, you’re protected against the chance of a big financial setback, a large

loss.”

Risk Management

Means you use various ways to deal with potential personal or financial losses.

Insurance

Protection against large-scale financial loss

Insurance Premium

The payment you make to an insurance company in exchange for its promise of protection and help.

Can be monthly, quarterly, semi-annually, or annually.

Deductible

The amount of the loss you must pay out of your own pocket before the insurance company begins to reimburse you.

Range from $100-$1,000+ SHOP AROUND for best rates

Types ofInsurance

Automobile Health

Homeowners/Renters

LifeDisability

Auto Insurance

Liability Coverage Medical Payments Uninsured Motorist Underinsured Motorist Collision

Auto Policies

Age Gender Marital Status Type of Car Cost of Repairs

Mileage Location Law Enforcement Driving Record

The following factors can influence the cost of the policy.

Health Insurance

Pays the medical bills in case you or your family members, become sick or injured.

Most will cover you until age 19. If you are in college, they may extend until 23.

Health Insurance

Property Insurance

Protects your material possessions in case they are damaged by fire, flood, or theft.

Homeowner’s insurance vs Renter’s Insurance

Life Insurance

Anytime someone else depends on your income to help pay bills, you need life insurance.

Protects people who depend on you financially in the event of your untimely death.

Term Life vs Whole Life

Future Insurance Needs

Health Insurance Property Insurance Life Insurance Disability Insurance Liability Insurance

Build Your Wealth

Read Build Your Wealth and complete the worksheet.

Story Book Your task today is to create a children’s story that easily

explains the importance of various financial terms and insurance.

You may work in a group of up to four people to create your story.

It should include the following terms: Wages, Health Care Insurance, Life Insurance, Retirement Fund, Vacation Leave, Auto Insurance, Sick Leave, and Home Owners Insurance.

Your story should be written such that a seven-year-old would understand these terms. Each page should include a picture as well as words.

Estate Planning

Estate planning is preparing a plan for transferring property during one’s lifetime and at one’s death.

Goal should be to minimize taxes on the estate, make known how you want your possessions distributed, and to provide for a smooth transfer of your possessions to loved ones after death.

Tools for Estate Planning

Will Trust Joint Ownership of Assets

Will

A legal document that tells how you want your estate to be distributed after your death.                                                                      

Power of Attorney

A legal instrument authorizing one to act as another’s attorney or agent.

Trust

A legal document in which an individual gives someone else control of property, for ultimate distribution to another person.