1. High School Financial Planning Program
Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

2. High School Financial Planning Program
Lesson 6-1: Manage Risk
Manage Risk
Tell others about the benefits of being insured
Display this slide as you begin the lesson.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

3. The Painful Side of Sports
High School Financial Planning Program
Lesson 6-1: Manage Risk
The Painful Side of Sports
What are the top three types of injuries for popular sports in this community?
Brainstorm a list of the five most popular sports in the school and community. Include in the list both contact and non-contact sports as well as cheerleading if applicable.
Divide the class into five groups, assigning one sport to each group. Have each group perform an Internet search of the three most frequent injuries for their assigned high school sport. (If they are having trouble finding information on high school sports data, have them widen the search to professional sports.) The easiest method for this search is to perform a Google search using the phrase “most frequent high school [type of sport] injuries,” and Google will compile data from a variety of sites to list injuries common to that sport. If Internet is not available, have the students generate a list from their observations and experiences.
Have the class compare documented injuries and decide on the one most common type of injury across sports. Survey the class to identify who might have suffered any of the mentioned injuries.
EXTENSION (now or after Learning Task #2): Have students research the average medical costs to repair or recuperate from the injuries that were identified in the previous activity.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

4. High School Financial Planning Program
Lesson 6-1: Manage Risk
Preview
Today we will answer these questions:
In what ways do teens face risks which can lead to costly consequences later?
How can teens manage the risk of loss and related costs?
What are consequences of not being insured?
Use what you learn today to inform others about reasons to be insured.
Preview the Learning Outcomes in the Student Learning Plan. By the end of this lesson, the students should be able to explain to others the benefits of being adequately insured.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

5. High School Financial Planning Program
Lesson 6-1: Manage Risk
Meet Aaron and Katie
Aaron - Grade 12
Hoping to get new job
Driver covered under family auto insurance
Car is damaged (twice!)
Katie - Grade 9
Injured soccer player; going to physical therapy
Rents school band instrument
Smartphone recently stolen
Student Guide, pages 3-4
Introduce Aaron and Katie as the young people featured in the Student Guide. The students will follow Aaron (Grade 12) and Katie (Grade 9) as they learn about protecting their health, money, and property.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

6. Disasters: Destructive and Expensive
High School Financial Planning Program
Lesson 6-1: Manage Risk
Disasters: Destructive and Expensive
Describe an expensive disaster:
nature of the event and the date
area that was affected
estimated total losses in dollars
information source
Student Guide, page 4 (question)
Ask students to recall a situation when they or a family member had property damaged, were in an accident, or were a victim of theft. Without sharing actual dollar amounts, select one or two situations to facilitate a discussion about the types of unexpected costs and other inconveniences that resulted from the situation(s). Point out how unexpected events can put a strain on an individual’s or family’s spending plan. Also identify inconveniences that might not have indirect monetary impact such as needing alternative transportation until a damaged car is repaired or taking unpaid time off work to get to injury therapy appointments.
Either in advance of class or as a whole class, identify several expensive insurance loss events in United States (or local state or community) in recent history. Arrange for students to work in small groups to gather information about these events. Guide each group to document and share the following for each event:
nature of the event and the date
area was affected
estimated total losses in dollars
information source
ALTERNATIVE: Assign specific types of disasters or events to each group, such as: tornados, hurricanes, extreme winter weather, drought, fire, flood, theft, etc. The most common types of disasters will depend on your particular region or state.
EXTENSION: Expand to a global search for the most expensive insurance losses in the world, and talk about the losses both in terms of human lives as well as financial losses. You can also have students search for the most expensive insurance losses in your state in recent history. Use this list to discuss types of insurance that would most benefit local residents.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

7. What are the Average Costs?
High School Financial Planning Program
Lesson 6-1: Manage Risk
What are the Average Costs?
Repair torn ACL, $40,000-$65,000
Fill small cavity, $75-$160 + exam fee
Repair chipped tooth, $200-$500 + exam fee
Remove wisdom tooth, $140-$400 + anesthesia
Remove dent from car, $50-$125
Remove multiple dents in car due to hail, $1,500-$11,000
Replace typical windshield, $100-$400
Claim for property damage due to vandalism, $4,512
Sources: aarp.org, webmd.com, dentalstraighttalk.com, yourdenstryguide.com, howmuchisit.org, costhelper.com,
As you transition into the next task, share statistics about financial losses. Ask students to brainstorm ideas on how to cover the unexpected costs of property damage, property loss, injuries, disasters, or illnesses. Specifically ask them how they would cover the costs for something in their possession that was stolen, lost, or damaged, such as a cellphone, friend’s bike that was borrowed, a school-owned tablet/laptop, or the car used for driver’s education.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

8. High School Financial Planning Program
Lesson 6-1: Manage Risk
4 Ways to Manage Risk
Avoid it
Reduce it
Accept it
Share it
Student Guide page 6
Point out four ways that individuals and businesses can deal with risks that have the potential for unexpected costs:
Avoid taking on the risk.
Reduce the possibility of risk.
Accept the consequences of any risk.
Share the risk by pooling financial resources to recover costs.
Arrange for the students to study the samples in Figure 6.1. Either in pairs or as a whole class, have the students respond to the question about the option(s) they would choose and why.
To illustrate the concept of sharing the financial burden due to an unexpected loss, facilitate an activity to survey the costs of a particular type of incident that several students have experienced. (The activity details and an alternative activity are outlined in the Teacher Lesson Plan, page 4.)
Debrief by asking if students to comment on whether or not the shared concept is fair. Facilitate a discussion about the fairness of pooling funds when some “insured” individuals might make multiple insurance claims while others might never have needed to make a claim. Explain that deductibles are applied as a way for insured people to take on some responsibility to cover financial losses before the insurance pays out on a claim. Read page 7 in the Student Guide for an additional explanation about insurance.
Prepare students to complete Activity 6.1: Teens at Risk, either individually or with partner. Review the four ways to minimize risk to point out that insurance coverage is not the only way to minimize risk. Provide an example of how a person might combine strategies such as sharing risk by buying homeowner insurance that requires the insured to pay a deductible before the insurance company covers fire damage expenses and reducing the risk of loss by proactively taking steps to reduce the potential for fire damage (i.e. installing fire alarms, installing a sprinkler system, or living in a brick house with a Class A metal roof). As time allows, arrange for some or all students to share responses.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

9. High School Financial Planning Program
Lesson 6-1: Manage Risk
We All Feel the Impact
Imagine a world without insurance.
What would people do to avoid risk?
What would be valued by people?
What might be the economic impact?
Describe at least five ways that our lives would be different without insurance.
Divide the class into five small groups and assign one of the following topics to a group:
Health care (health insurance)
Housing (home insurance, renter’s insurance)
Employment (unemployment insurance, disability insurance)
Businesses/Commerce (property insurance, general liability)
Transportation (auto/motorcycle insurance)
Tell students that in their groups they will predict what “a world without insurance” might look like, focusing on the specific topic assigned. For example, what would our health care system look like if there were no health insurance? How would that impact families?
It would help if students had a better understanding of the type of insurance(s) that cover their assigned topic. If students need assistance with this assignment, allow them to use their Student Guide (pages 16, 19, 21) and the Internet to define their insurance topic before addressing the questions.
Distribute at least one copy of the Global Consequences Task to each group. Have each team generate at least five different descriptive consequences that would describe their world without their assigned type of insurance. The questions provided are meant to help guide group work. Arrange for each group to present the imagined world to the rest of the class. Note: An example is provided on the Task handout.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

10. High School Financial Planning Program
Lesson 6-1: Manage Risk
Reflection
What risks to you face on a daily basis? List at least two actions you can take to avoid and/or reduce specific risk in your daily routine.
Ask the students to think about their daily routines and misfortune that could happen throughout the day. Have them list at least two actions they can take to reduce the potential for risks.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

11. High School Financial Planning Program
Lesson 6-1: Manage Risk
Challenge
A Case for Insurance
Create a persuasive advertisement to convince your peers about the value of reducing risk in their lives along with the value of using insurance to share risk.
Pick a format for a to 60-second ad:
radio ad
skit
television commercial
infomercial
music video
Prepare to share your ad with the whole class
Protect Your Property and Health
Buy Insurance
Student Guide, page 11
Schedule time for the students to complete Challenge 6-A: A Case for Insurance. Either independently or in small groups, challenge the students to create a persuasive advertisement to convince their peers to become insured and reduce risk.
Groups need to decide on the most appropriate approach for their ads: radio ad, skit, television commercial, infomercial or music video formats. Ads should be roughly 30 seconds in length.
As time allows now or in a later class session, arrange for students to share or perform their ads with the whole class.
©2014 National Endowment for Financial Education | Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |

12. High School Financial Planning Program
Lesson 6-1: Manage Risk
©2014 National Endowment for Financial Education |