Category insurance

Oct 25 2025

WHAT TO KNOW ABOUT DEDUCTIBLES  

Here are some things to know about deductibles when deciding what policy to buy.

  1. Know the math

A deductible may be a specific dollar amount or a percentage. If a policy has a deductible that’s a percentage, make sure you know how that translates to a dollar amount. Here are two examples for homes insured for $150,000:

  • Policy A has a $500 deductible. A hail storm destroys the home’s roof, and the cost for repairs is $6,500. Policy A will pay $6,000 of the cost to repair the roof.
  • Policy B has a 5 percent deductible – or $7,500. If the home needed $6,500 in roof repairs, Policy B would not pay anything because the amount of repairs is less than the deductible.

2. Know when it applies

Deductibles for home and auto policies work differently than deductibles for health policies.

For health policies, the deductible usually covers a year.

For home and auto policies, the deductible will be applied to each claim. If you have a wreck in February and your car gets broken into in June, your insurance company will subtract the same deductible amount from the damages of each claim before paying.

3. Know what works for you

In general, the higher the deductible, the lower the cost for the policy. When deciding what deductible is right for you, think about how much you can afford to pay if your property is damaged. Remember that filing small claims may affect how much you have to pay for insurance later. Switching from a $500 deductible to a $1,000 deductible can save as much as 20 percent on the cost of your insurance premium payments.

For more information, go to: What to know about deductibles

Teaching Suggestions:

  • Ask students what deductibles they have on their automobile and home insurance.  What factors did they consider to determine their deductibles?
  • Have students talk to friends and relatives to determine methods of reducing home and auto insurance premiums.

 Discussion Questions:

  1. What are some arguments in favor of and against higher deductibles?
  2. What should be the main factors used to determine methods of reducing the cost of home and auto insurance?
Oct 11 2025

How are your auto and homeowners insurance costs calculated?

Insurance companies set prices to match the cost of future claims. To do this, insurance companies look at your personal risk factors (the type of car you drive or where you live). But they also look at how much they spend on all claims.

Insurance companies determine premiums and rates by looking at you

Insurance companies use many factors to calculate what they charge a customer. Each company’s premium formula is different.

For home insurance, common factors include:

  • Your home’s age.
  • Your home’s roof age and material.
  • Where you live.
  • The cost to replace your house.
  • Your claim history.
  • Your credit score.

For auto insurance, common factors include:

  • Your driving record and claims history.
  • Where you live and how much you drive.
  • Your age, gender, and marital status.
  • Your occupation.
  • The cost to replace the car you drive.
  • Your credit score.

If some of these factors changed since your last renewal, it could raise or lower your premium. This includes characteristics that change over time, such as how much your home or auto is worth. You may see such changes in a policy’s premium from one renewal to the next.

Most State laws require that insurance rates:

  • Be adequate.
  • Not be excessive.
  • Be based on sound actuarial principles.
  • Be reasonably related to all costs.
  • Not be based on the insured’s race, creed, color, ethnicity, or national origin.

Ask about discounts and shop around

If your auto or home insurance bill is rising, ask your company to explain the increase and ask if you’re getting all available discounts.

For more information, go to:

How are your auto and homeowners insurance costs calculated?

Teaching Suggestions:

  • Have students ask their insurance company if they are getting all available discounts.
  • Ask students to consider calling an independent insurance agent for insurance cost comparisons.

Discussion Questions:

  1. What factors do insurance companies use to calculate your auto and home insurance premiums?
  2. Why do insurance companies use your credit scores to determine your premium for your home and auto insurance?
  3. What is reinsurance and why do insurance companies buy reinsurance?
Sep 13 2025

Ways to save money on home insurance

Did your homeowner’s premium go up? Use these tips to see if you can get a lower rate.

  1. Shop around

Insurance companies charge different rates, and your company might have raised your rates.

You can shop around for a better price. Get sample rates at HelpInsure.com. Then contact the companies you’re interested in and use these tips.

Learn more: How to shop smart for home insurance (checklist)

2. Ask about discounts

Make sure you’re getting all the discounts you qualify for. Ask your insurance company if it offers discounts for:

  • Having a monitored burglar or fire alarm system.
  • Having other policies with the same company (like auto, home, life, etc.).
  • Not filing any claims for three straight years.

Learn more: Lower your home insurance cost by asking for discounts

3. Look at your deductible

Choosing a policy with a higher deductible can lower your premium. But remember that a higher deductible means you might have to pay more out-of-pocket if you have a claim. How much can you afford to pay if your home is damaged?

Remember: A good price is only a bargain if you also get good service. Call your State Department of Insurance  to check a company’s complaint record before buying a policy.

 For more information, go to:

Ways to save money on home insurance

Teaching Suggestions:

  • Have students suggest methods of determining how to save money on home insurance.  Also, ask for actions that can be taken to achieve the goals.
  • Have students create a system for starting and updating a home inventory.

Discussion Questions:

  1. When does a family or individual know they have enough home insurance?
  2. What type of insurance coverage is more important, property or liability?  Explain
Aug 30 2025

Will my insurance premiums go up if I file a claim?

It depends on the type of claim and how many you file. But, yes, your home and auto premiums can go up if you file claims. You could also lose any discounts you’re getting for being claim free.

  1. What counts as a claim?

Home and auto insurance companies can raise your premium for filing most types of claims. Auto companies can raise your premium if you’ve had accidents or gotten traffic tickets.

Home and auto companies can’t charge you more for:

  • Claims you file that the company didn’t pay. This includes claims the insurance company denied because your policy doesn’t cover the damage.
  • Calling your company or agent to ask questions about your policy or the claims filing process.

Home companies can’t charge you more for:

  • Claims for damage from natural causes, including weather.
  • Appliance-related water damage claims, if the repairs have been inspected and certified, unless you have three or more claims in three years.

    2. Consider your deductible
  • Before you file a claim, find out how much your deductible is. The insurance company will subtract the amount of your deductible from your claim payment. Also get repair estimates. If the cost of repairs is about the same or less than your deductible, you may decide it’s not worth filing a claim. Learn more about deductibles.

    3. Know your claims history

Insurance companies use your claims history to decide if they want to sell you a policy and how much to charge you. Most insurance companies get a report from the Comprehensive Loss Underwriting Exchange (CLUE) to learn your claims history. Because most companies use CLUE, they can learn about home or auto claims you’ve filed, even if the claim was with another insurance company.

For more information, click here.   

Teaching Suggestions:

  • Ask students if they or their family members filed any home or auto claims with rheir insurance company.  If so, what was their experience?
  • Ask students if the insurance company raised their premiums or cancelled their insurance coverage.

Discussion Questions:

  1. Why is it important to consider your deductibles before filing a home or auto insurance claim?
  2. Why do insurance companies use your claims history to decide if they want to sell you a policy or much to charge you?
Nov 23 2024

Do you have enough home insurance?

Could you rebuild if a tornado or fire destroys your home? Some experts say half of all homes may not have enough insurance. Here are tips to make sure you have the right amount of coverage.

1.    Find out what it would cost to rebuild your home.

This is not the same as the real estate price, or market value. The rebuilding cost is based on what kind of home you have and local construction costs. The rebuilding cost is sometimes called replacement cost. Your insurance agent can help find out your rebuilding cost.

2.    Your insurance coverage should match the rebuilding cost.

You can find your policy limits on the front page of the policy or ask your agent. If the amount is lower than the estimate to rebuild, you may need to make changes.

3.    Check your insurance coverage regularly.

Check your coverage when you renew your policy each year. You should also talk to your insurance agent if you remodel or make upgrades. A new deck, garage, or kitchen can increase the cost to rebuild

For more information, click here.

Teaching Suggestions:

  • Have students research special types of property and liability insurance.
  • Have students talk to an insurance agent or claim adjustor to determine the type of documentation required for a claim settlement.
  • Ask students to obtain additional information on home insurance from the Insurance Information Institute or other online sources.

Discussion Questions:

  1. Why is it important to check your insurance coverage regularly?
  2. What type of insurance coverage is more important, property or liability?  Explain.
Aug 31 2024

Home and Auto insurance costs

Each insurance company uses many factors to calculate what they charge a customer for home and auto insurance.

Some factors are about you, your home, or your car.

For home insurance, common factors include:

  • Your home’s age.
  • How old your roof is and what it’s made of.
  • Where you live.
  • The cost to replace your house.
  • Your claim history.
  • Your credit score.

For auto insurance, common factors include:

  • Your driving record and claims history.
  • Where you live and how much you drive.
  • Your age, gender, and marital status.
  • Your occupation.
  • The cost to replace the car you drive.
  • Your credit score.

A change in any factor can raise or lower your premium. This includes characteristics that change over time, such as the value of your home or auto.

For More Information, click here.

Teaching Suggestions

  • Ask students to make a list of major factors that most insurance companies use to calculate your premiums for home and auto insurance.
  • Have students talk with an insurance agent or financial planner to obtain recommendations about the types of insurance you may need for home and auto insurance.

Discussion Questions

  1. Why do insurance companies consider your credit score in determining your home and auto insurance premiums?
  2. In your opinion, what should be the main factors used to determine the amount a person pays for auto insurance?
Feb 3 2024

Do you need life insurance?

Think about your age, your financial situation, and if you have loved ones who depend on your income. If you do decide to shop for life insurance, here are some things to consider.

  1. How much life insurance do you need?

Life insurance helps your loved ones with financial needs when you die. Consider your mortgage and other debts, how much income would need to be replaced, money to cover a funeral, and college for the kids. Add those up, and you’ll have a good idea of how much insurance you’ll need.

2. Term or permanent?

There are two main categories of life insurance:

Term life insurance is the simplest and least expensive option. It covers you for a set period of time. You might consider term life insurance when you have a family that depends on your financial support or while you have a mortgage. For example, you may want a term life policy that lasts until your children are out of school.

Permanent life insurance provides coverage for your entire life as long as you keep up the payments. Because of the length of coverage, it costs more than term life insurance. These policies may have features that offer a cash value that can be used to invest or pay some of the premiums later in life. Permanent life policies are complicated so it’s best to talk to a financial planner when deciding if one is right for you. If you do buy a permanent life policy, make sure to check with your agent each year to see how the policy is doing and if you need to adjust your payments.

3. How much will it cost?

Insurance companies consider things like your age, health, job, and tobacco and alcohol use when setting prices. It will cost more to purchase life insurance as you get older and if you have health problems. Some companies may require a medical exam before selling you life insurance.

4. Who will benefit?

You can leave money to a spouse, children, other family member, or friend. This is known as the policy’s beneficiary. You can also name an institution as your beneficiary, such as a business or charity. And you can choose more than one beneficiary and specify how the money will be divided.

For more information, click here.

Teaching Suggestions:

  • Have students create situations which point out the different reasons for buying Life Insurance.
  • Have students survey several other people to determine their reasons for buying Life Insurance.

Discussion Questions:

  1. What is the relationship between age and the amount a person pays for life insurance?
  2. What personal, social, and financial factors should influence the amount of life insurance a person might desire?
  3. Why might many insurance agents dissuade you from buying low-cost-term insurance?
Jan 6 2024

Artificial Intelligence in Forecasting Severe Storms, Hurricanes, Floods, and Wildfires

Government Accounting Office (GAO) found that machine learning, a type of artificial intelligence (AI) that uses algorithms to identify patterns in information, is being applied to forecasting models for natural hazards—such as severe storms, hurricanes, floods, and wildfires—that can lead to natural disasters. A goal is to improve the warning time for severe storms.

 GAO identified potential benefits of applying machine learning to weather forecasting, including:

  • Reducing the time required to make forecasts.
  • Increasing model accuracy.
  • Reducing the uncertainty of model output.

Forecasting natural disasters using machine learning GAO also identified challenges to the use of machine learning. For example:

  1. Data limitations hamper the training of machine learning models and can reduce accuracy
  2. A lack of trust and understanding of the algorithms as well as concerns about bias
  3. Limited coordination and collaboration create challenges for fully developing some machine learning models.
  4. Workforce and resource gaps also create challenges.

For More Information, click here.

Teaching Suggestions:

  • Make a list of potential benefits of machine learning to weather forecasting in relation to insurance costs.
  • Make a list of potential dangers using machine learning in forecasting natural disasters in relation to insurance costs.

Discussion Questions:

  1. Do you believe that insurance premiums should be calculated based upon forecasting models for natural hazards. such as severe storms, hurricanes, floods, and wild fires? 
  2. What are some challenges to the use of machine learning in forecasting natural disasters?
May 22 2021

High Medical Costs: How to save money on the doctor

Asking a few questions about your health insurance and knowing your options can protect your wallet after a doctor’s visit.

1.    Know your options

How much you’ll spend at the doctor depends on what type of doctor you visit. Most plans will cover a phone call with a nurse, an online doctor visit, or visits to a doctor’s office, an urgent care clinic, or a hospital emergency room. Nurse lines and online visits are usually cheapest (and often free). Emergency rooms are the most expensive.

2.    Ask if the doctor is in your plan’s network

Most health plans have a network of doctors, specialists, and other providers. You’ll pay more if you get care outside the network. Ask your health plan if the doctor, facility, or hospital you want to visit is in your network. If you go to a doctor outside your network, ask the doctor about the cost. Some might be willing to negotiate lower prices with you.

3.    Ask how to save money on prescriptions

Most plans have a list of drugs that they will pay for. The list also shows how much you’ll have to pay. If the drug is too expensive, ask your doctor if there’s a generic version. If you choose the brand-name drug, there may be coupons or discounts that can save you money. Ask your pharmacist where you can find coupons.

4.    Ask questions if you get a bill

If the visit was covered by insurance, don’t pay more than the explanation of benefits from your health plan states you may owe. If the bill was for more than you were expecting, ask the doctor or facility for an itemized bill. Look for errors or duplicate charges. Call your health plan if you have questions. You can also ask the doctor for a discount or an interest-free payment plan.

Resources

For more information, click here.

Teaching Suggestions

  • Ask students whether they or their family members have requested from their physician and pharmacist if a less expensive drug is available?
  • Are you aware that many states offer state pharmacy assistance programs that help pay prescription drugs based on financial need, age, or medical condition?

Discussion Questions

  1. Have you considered using a mail-order or legitimate online pharmacy for your prescriptions, especially if you will take a drug for a long time?
  2. What are your options to get the medical care you need and avoid a big bill?
May 8 2021

Insurance tips following storms

If your home was damaged by the severe weather, contact your insurance company or agent to file a claim as soon as possible. These tips will help you make the process go smoother:

  1. Keep a list of everyone you talk to at your insurance company.
    Be ready to answer questions about the damage.
  2. Make a list of damaged property.
    Take pictures or videos. Don’t throw anything away until your insurance company tells you to do so.
  3. Take steps to protect your home from further damage.
    Cover broken windows and holes to keep rain out and prevent vandalism or theft.
  4. Try to be there when the insurance company comes to inspect the damage.
    If you can’t stay in your home, leave a note with information on where you can be reached.
  5. Ask your agent about additional living expenses.
    If you’re forced out of your home to make repairs, your insurance policy may pay for some of those expenses.
  6. Avoid fraud (with the following recommendations):
    • Get written estimates.
    • Get more than one bid
    • Beware of contractors who solicit door to door.
    • Check references and phone numbers.
    • Don’t pay up front.
    • Avoid contractors who offer to waive your deductible or promise a rebate for it.
    • Never sign a contract with blank spaces.

For More Information, click here.

Teaching Suggestions

  • What actions should you take to protect your property before a severe storm and floods?
  • Make a checklist of actions that you should take after the storm?  Share the list with other students.

Discussion Questions

  1. Under what circumstances is it better not to file a claim?
  2. If you file a claim and your insurer rejects it, what are your options?  Who should you turn to for assistance?