Learn the basics about auto insurance from PEMCO Insurance. This abbreviated version is geared toward high school students, or anyone else who wants to know the basics: how insurance works, why you need it, how to keep your rates down, and types of auto insurance coverage.

1. Auto insurance basics
for teen drivers

2. You’ll learn …
• How insurance works, why you need it
• How to keep auto insurance rates down
• Types of auto insurance coverage

3. How does insurance work?
• People pool money to guard against risk
• The money pool pays for big losses
• Insurance is not an investment
• Where does $ go if you have no claim?
• People with higher risk pay more

4. How to keep insurance rates
down 
• Good grades (3.0 and up) help the most
• The type of car does matter
• Drive safely – avoid tickets, accidents
• Do not phone or text while driving
• Take advantage of discounts

5. How to keep insurance rates
down 
• Speeding tickets are a good predictor of
future accidents
• With each ticket you get, the likelihood of
a future accident increases
• You pay higher premiums if you have
tickets and accident

6. Auto policy coverages:
Collision
• Covers YOUR car
- regardless of fault
- when your car hits another object,
gets hit, or overturns
- a ‘deductible’ applies

7. Auto policy coverages:
Comprehensive
• Required if you have a loan
• May not be needed on older, lower-
valued cars
• Covers vandalism, theft, acts of nature
(weather, fire, etc.)

8. What do you think?
True or false:
• All cars require Comprehensive and
Collision coverage.
FALSE. If there’s no loan, Comp and
Collision may not be needed on
older, lower-value cars.

9. Auto policy coverages:
Bodily Injury Liability
• Covers YOU for injury you cause to
someone else – injury for which you are
found liable
• Required by law

10. Auto policy coverages:
Property Damage Liability
• Covers YOU for damage you cause to
someone else’s property, damage for
which you’re found liable
• Required by law

11. Auto policy coverages:
Underinsured Motorist
Bodily Injury
• Insurance is required by law
• 20-35% of drivers don’t carry any
insurance
• Others carry only low limits

12. Underinsured Motorist
Bodily Injury
• Protects YOU if someone without enough
insurance injures you
- medical costs
- lost wages
- pain and suffering

13. Auto policy coverages:
Underinsured Motorist
Property Damage
• Protects YOU if someone without any or
enough insurance damages your car

14. Auto policy coverages:
Personal Injury Protection
• Protects YOU regardless of who is at
fault in accident
• Medical coverage – fills gaps in standard
medical plans
• Replaces income while you can’t work

15. Want to learn more?
That’s just a tiny sample of our full presentation.
To learn more, schedule a speaker from PEMCO
to come speak to your class or PTSA.
We can accommodate most requests in the Puget
Sound area, and some requests statewide.
Contact: jonosterberg@pemco.com

16. The most important piece of
safety equipment in any vehicle
is the one behind the wheel.