Order from highest to lowest cost: renters insurance, health insurance for average adult, car insurance for 16 year old?

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May 19, 2019
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Insurance, Question of the Day

Answer: 

  1. Health insurance: $5,712
  2. Auto insurance for a 16 year old; $4,140
  3. Renter's insurance: $154 - $224

Questions:

  • What do you think are the reasons that people buy insurance for their health, auto and for the apartment they rent?
  • Why do you think that health insurance is more expensive than the other types?
  • Which of the three types of insurance do you think increases in cost as you get older? declines in cost as you get older? Explain.

Here's the ready-to-go slides for this Question of the Day that you can use in your classroom.

Behind the numbers (from Value Penguin):

On health insurance: Health insurance is an important investment to make in oneself, family members, and loved ones. According to the Department of Health and Human Services’ 2017 Annual Insurance Survey, the average monthly premium for individuals in the United States was $476 (or $5,712 per year).

On car insurance: "Auto insurance quotes also vary depending on the driver's age and their years of experience. Young and inexperienced drivers tend to be more dangerous behind the wheel, which is why insurance companies charge them higher auto insurance rates.

For example, teenage drivers pay nearly four times more than those in their 20's—with 16-year-old drivers paying an average of $344.78 a month for auto insurance coverage. Contrast that to a 25-year-old driver paying only $118.89 a month on average for their auto insurance policy."

On renters insurance: If you're one of the millions of Americans who have forgone buying a house in exchange for renting a place, you may want to consider renters insurance as a way to protect your personal belongings. Renters insurance protects your studio, walk-up apartment, or elevator apartment against events such as destruction of property from fire, vandalism, and theft.

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Check out our latest Insurance MOVE activity: What determines your insurance premium? 

 

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.