Could usage-based car insurance save you money?

  1. How does it work?

Most usage-based car insurance policies have you plug a small device into your car’s diagnostic port, which is usually under the dashboard.  Others use cell phone connections or apps.  All of them send information about your driving to your insurer.

  1. Is it a good deal?

It could lower your premium if you drive safely and don’t drive lots of miles.

  1. How about my privacy?

There are many privacy issues to consider related to these types of policies.

For more information click here.

Teaching Suggestions

  1. Ask students to find out if their car insurer offers usage-based insurance.
  2. Under what circumstance will you consider purchasing usage-based car insurance?

Discussion Questions

  • What might be the purpose of using global positioning systems and other technology in determining the car insurance premiums?
  • Will younger drivers embrace the monitoring devices, especially when car chips allow parents to monitor the speed and braking habits of young drivers?

Auto Insurance Resources

Having adequate auto insurance and determining what coverages are needed are fundamental for avoiding financial difficulties. Consumer Action (www.consumer-action.org) offers a variety of materials related to shopping for auto insurance, managing auto insurance costs, and obtaining assistance when encountering trouble when filing a claim.

These resources includes downloadable publications on the basics of auto insurance in English, Spanish, Korean, and Vietnamese. Also available are PowerPoint slides and lessons plans.

For additional information on auto insurance resources, click here.

 

Teaching Suggestions

  • Have students develop actions that can reduce the cost of auto insurance.
  • Have students create a video that demonstrates financial problems associated with not having adequate auto insurance.

Discussion Questions 

  1. What are information sources that might be used to become better informed on auto insurance?
  2. How might a person reduce the cost of auto insurance?

Trick yourself into saving

Saving money can be automatic with some simple actions that would reduce your monthly spending.  Some actions, which can include lowering your monthly cash outflows by as much as $400, include:

 

  • Using a programmable thermostat which can be used to automatically raise and lower the temperature in your home, resulting in energy savings.
  • Increasing insurance deductibles for your home and auto insurance which will likely result in an annual savings of several hundred dollars.
  • Practicing less aggressive driving; using a constant speed can save money on fuel costs.
  • Seeking out ways to reduce your communication bills, such as using basic cable along with streaming video on your computer. Also, using a free texting app on your phone.
  • Using a refillable water bottle can save hundreds of dollars by not buying bottled water.

 

To ensure that you actually save this money, each month, have funds automatically moved into a savings account or investment program.

For additional information on saving, go to:

http://www.bankrate.com/finance/video/saving-money/trick-yourself-into-saving.aspx#ixzz3IKDG71pN

Teaching Suggestions

  • Have students conduct online research to determine various actions to reduce spending and increase savings.
  • Have students interview several people to determine various actions that might be considered for reducing spending.

Discussion Questions 

  1. What actions have you taken to reduce spending and increase savings?
  2. Explain short-term and long-term benefits of reduced spending.

 

 

Reduce Auto Insurance Costs

Auto insurance requirements vary from state to state.  Check with your state insurance regulator to learn more about individual requirements as well as insurers you may be considering for the insurance policy.

To get the best coverage at the best price, get several quotes from insurance companies; it may save you hundreds of dollars every year.  What can you do to reduce your insurance premiums?

Raise your deductible on collision and comprehensive coverage.  If you own an older car, you might want to eliminate this coverage altogether.  Don’t forget to take advantage of discounts available to you.  For example, you may be eligible for a discount based on the number of miles you drive; your age; your good grades if you are a student; your driving record; or if you have taken a safe driving course.   You may also be able to get discounts if you insure more than one vehicle, insure your vehicle and home with the same company, have anti-theft devices, or have safety features as air bags or anti-lock brake system.

For more information on automobile insurance costs go to  www.naic.org; http://www.insure.com; and http://www.insweb.com

Discussion Questions

1.  What can you do to reduce your automobile insurance costs?

2.  Why better college grades result  in reducing your automobile insurance costs?

 

Teaching Suggestions

You may want to use the information in this blog post and the websites to

* Have students research various types of discounts available to them.

* Research the make and model of vehicles that are most frequently stolen, consequently resulting in higher insurance rates.