1. Homeowners and Auto Insurance
Chapter 22
Homeowners and Auto Insurance

2. Risk-Management Methods
Home and Motor Vehicle Insurance
Chapter 22
Section 1
Insurance and Risk Management
Risk-Management Methods
Methods of Risk-Management
Risk Avoidance
Risk Reduction
Risk Assumption
Risk Shifting

3. Home and Motor Vehicle Insurance
Chapter 22
Section 1
Insurance and Risk Management
Types of Risk
Personal risks, property risks,and liability risks are insurable.
Speculative risks are not insurable.

4. Planning an Insurance Program
Home and Motor Vehicle Insurance
Chapter 22
Section 1
Insurance and Risk Management
Planning an Insurance Program
Steps to Planning an Insurance Program 4
Review Your Results 3
Put Your Plan into Action 2
Develop a Plan 1
Set Insurance Goals

5. Home and Motor Vehicle Insurance
Chapter 22
Homeowners Policy Coverage

6. Property and Liability Insurance
Home and Motor Vehicle Insurance
Chapter 22
Section 1
Insurance and Risk Management
Property and Liability Insurance
Two Types of Risks for Property Owners
Loss or Damage Caused by Criminal Behavior
Physical Damage Caused by Perils

7. Renters Insurance 22 Renters Insurance
Home and Motor Vehicle Insurance
Chapter 22
Section 2
Home and Property Insurance
Renters Insurance
Renters Insurance
Does not provide coverage on the building or other structures
Protects personal property
No coverage under the landlords policy unless the landlord is liable for damage
Inexpensive

8. Home Insurance Policy Forms
Home and Motor Vehicle Insurance
Chapter 22
Section 2
Home and Property Insurance
Home Insurance Policy Forms

9. Home Insurance Cost Factors
Home and Motor Vehicle Insurance
Chapter 22
Section 2
Home and Property Insurance
Home Insurance Cost Factors
Location of Home
Company Differences
Type of Structure
Factors Affecting the Cost of Home Insurance
Home Insurance Discounts
Price, Coverage Amount, Policy Type

10. 22 Home and Motor Vehicle Insurance Section 2
Chapter 22
Section 2
Home and Property Insurance
Many insurance companies will not want to sell homeowners insurance policies to everyone in the same neighborhood. Infer why this might be the case.
Responses might include that if a natural disaster were to occur it would be too expensive for one company to cover all the repairs and living expenses necessary for an entire neighborhood.

11. The Need for Auto Insurance
Home and Motor Vehicle Insurance
Chapter 22
Section 3
Motor Vehicle Insurance
The Need for Auto Insurance
Every state in the United States has a financial responsibility law.

12. Liability covers you for injury to others or damage to their property
Most states (including Michigan) require you to buy liability to legally drive
Liability includes coverage for:
Bodily injury of another person
Damage to another persons property

13. The Need for Auto Insurance
Home and Motor Vehicle Insurance
Chapter 22
Section 3
Motor Vehicle Insurance
The Need for Auto Insurance

14. Motor Vehicle Bodily Injury Coverage
Home and Motor Vehicle Insurance
Chapter 22
Section 3
Motor Vehicle Insurance
Motor Vehicle Bodily Injury Coverage

15. Premiums
Your yearly premium is the amount you pay per year.
depends on coverage (bodily + property)
What is your yearly premium if you buy 100/300/50 liability coverage?
$ = $266.70

16. Collision and Comprehensive Insurance
Collision – coverage for damage to your car by an accident
Comprehensive – coverage for fire, theft, vandalism, and weather
Deductibles – amount you pay before the insurance company pays
Your premium depends on your deductible (higher deductible = lower premium)

17. Collision and Comprehensive Insurance
Example: You buy $200-deductiable collision insurance and $100-deductible comprehensive insurance. What is the total yearly premium?
$ $ = $198.61

18. Premium Ratings Insurance premiums depend on ratings.
Your rating depends on your age, gender, record, vehicle and the purpose for driving.
Total premium = base ∙ rating

19. Premium Ratings

20. Other Motor Vehicle Insurance Coverages
Home and Motor Vehicle Insurance
Chapter 22
Section 3
Motor Vehicle Insurance
Other Motor Vehicle Insurance Coverages
Rental Reimbursement Coverage
Wage-Loss Insurance
Towing and Emergency Road Service Coverage

21. Motor Vehicle Insurance Costs
Home and Motor Vehicle Insurance
Chapter 22
Section 3
Motor Vehicle Insurance
Motor Vehicle Insurance Costs
Legal Concerns
Amount of Coverage
Property Values