- Budgeting
- Cash Management
- Consumer and Mortgage Loans
- Debt and Debt Reduction
- Time Value of Money 1: Present and Future Value
- Time Value of Money 2: Inflation, Real Returns, Annuities, and Amortized Loans
- Insurance 1: Basics
- Insurance 2: Life Insurance
- Insurance 3: Health, Long-term Care, and Disability Insurance
- Insurance 4: Auto, Homeowners, and Liability Insurance
- The Home Decision
- The Auto Decision
- Family 1: Money and Marriage
- Family 2: Teaching Children Financial Responsibility
- Family 3: Financing Children’s Education and Missions
- Investments A: Key Lessons of Investing
- Investments B: Key Lessons of Investing
Financial Plan Assignments
There are several different assignments for this section. Having auto insurance is a critical part of owning and driving a car; in fact, it is illegal to drive a car unless you have insurance. Your assignment is to get a copy of your auto insurance and include it in your financial plan.
Look at your credit score if it is reported on your policy. The credit score shown on your policy should be consistent with the credit score that you received from the credit scoring agencies for an earlier assignment. Improving your credit score can lower the cost of your auto insurance.
Look at the discounts on your policy, such as discounts for good students, good drivers, multiple cars, and so on. Call your insurance provider and find out if there are any other discounts you qualify for. Discounts can reduce the cost of your insurance policy.
Review each of the four basic parts of your insurance: liability coverage, medical coverage, uninsured/underinsured coverage, and comprehensive physical damage coverage. What are your liability limits? If you have split coverage, how is the coverage split? Remember that most state requirements for liability insurance were set more than thirty years ago; these requirements are generally insufficient, given the rising costs of medical and automobile repair. If you must reduce your insurance costs, increase your deductible rather than reducing your liability limits.
If you own a home or a condo, get a copy of your homeowners policy and review it carefully. Which type of homeowners insurance do you have? Is your homeowners insurance sufficient for your needs? Does it cover the current value of your home? What could you do to improve your coverage?
Do you have a need for umbrella coverage? As the size of your assets increases, umbrella insurance may be something to look into.
As an optional activity, you can find out what insurance companies see when they look at your insurance reports. Under the FACT Act of 2003 (Fair and Accurate Credit Transactions Act) you can obtain a free copy of the following reports each year from the Comprehensive Liability Underwriting Exchange, or CLUE:
CLUE Auto: A five-year loss-history report is a report that is generated if a loss is filed against your automobile insurance policy and the insurance company reports the information to CLUE.
CLUE Personal Property: A five-year loss-history report is a report that is generated if a loss is filed against your homeowners insurance policy and the insurance company provides this information to CLUE.
To get both CLUE reports, go to www.Choicetrust.com, click on CLUE Reports, click on CLUE reports again, then order options, then both reports, then new member. Fill out the information for new members, including Social Security number, driver’s license number, and address. Then verify the information and obtain the reports. If claims that the insurance company has paid are shown on these reports, copy the reports and include them in your Personal Financial Plan. You can also dispute the information if it is not correct or if you are planning on switching insurance companies.
