Chapter 16

1. Chapter 16 • Buying and Owning a Vehicle

2. 16.1 Buying a VehiclePage 336 • Can You Afford to Own a Vehicle? • Purchase Price • Depreciation • Financing • Other Costs

3. What Kind of Vehicle Should You Buy?Page 336 • What will I use the car for? • Do I need certain passenger and cargo capacities? Will I need to tow anything? • How many miles will I drive each year? • Will I use the vehicle more for short trips or long trips? • How long will I expect to keep the vehicle?

4. Vehicle Size-Page 337 • What to consider about vehicle size? • Smaller, lighter vehicle usually gets better gas mileage but does not offer as much protection in a collision as a larger, heavier vehicle. • Smaller vehicles are easier to maneuver than larger vehicles, especially when parking • A larger vehicle provides a more comfortable ride but is usually more costly to operate. • A larger vehicle has a greater capacity for passengers and parcels.

5. Optional Equipment-Page 337 • What is optional equipment? • Be aware, optional equipment will add to the cost of the vehicle.

6. Leasing a Vehicle-Page 338 • What does it mean to lease a vehicle? • At end of lease, you must choose one of the following three options: • Return the vehicle and lease another one. • Purchase the vehicle at a cost determined at the start of your lease. • Return the vehicle with no obligations to either lease another vehicle or purchase the vehicle you returned.

7. Leasing Cont.-Page 338 • Leasing is not for everyone. Most lease agreements limit how many miles you can put on the vehicle. Extra miles are likely to cost you an additional charge.

8. Buying a used Vehicle-Page 339 • Warranty

9. How Much Should You Pay-Page 339 • Blue-Book Prices

10. Choosing a Used Vehicle-Page 339 • Good mechanical condition. • Was it ever involved in a collision, or needs repair. • When possible, talk to previous owner about condition of vehicle and previous maintenance service that has be done on vehicle.

11. Choosing Used Vehicle Cont.-Page 339-341 • Outside and inside checks. • Test Drive-When test driving a vehicle, drive vehicle on a rough road at 25 mph and TURN RADIO OFF. The vehicle should not rattle or feel unsafe. • Have vehicle inspected.

12. 16.2 Insuring a Vehicle-Page 342 Financial responsibility law • What is it?

13. What is Vehicle Insurance-Page 342 • Premium—A specified amount of money you pay for coverage over a specified period of time, to the company.

14. Liability Insurance-Page 342 • What is liability insurance? • Liability insurance is the most important type of insurance to have. • Protects the driver who caused the collision.

15. Bodily-Injury Insurance-Page 342 • What is bodily insurance? • Insurance that covers the driver who is at fault against claims.

16. Property-Damage Insurance-Page 342 • What is property-damage insurance? • Insurance that protects the driver who is at fault against claims for damages to another person’s property, up to specified limits.

17. Medical Payment Insurance-Page 342 • What is medical payment insurance? • Insurance that pays medical expenses for bodily injuries sustained by occupants in an insured vehicle.

18. No-Fault Insurance-Page 342-344 • What is no-fault insurance? • Insurance that is recovered from your own insurance company because of long delays in litigation no matter who is at fault.

19. Chart on Page 343 • Collision Insurance-Drop after 7-10 years for new or expensive cars of ownership or when value of car no justifies cost of coverages. • Comprehensive Insurance-Drop after 7-10 years of ownership for new or expensive cars.

20. Collision Insurance-Page 344 • What is collision insurance? • Insurance that covers you if you are at fault in a collision, or not able to collect from the person who is at fault. • What is a deductible? • The amount you agree to pay towards the repair or replacement of the vehicle.

21. Comprehensive Insurance-Page 344 • What is comprehensive insurance? • Insurance that for pay for the replacement or repair of your vehicle if it is damaged for some reason other than a collision.

22. Uninsured and Underinsured Insurance-Page 344 • What is uninsured insurance? • Insurance that protects you if you are struck by another vehicle whose driver has no insurance. • What is underinsured insurance? • Your insurance company will pay any costs that exceeds what the other person’s company will pay as a result of a collision.

23. Insurance Rates-Page 344Factors that determine what you pay for Insurance • Driving Record • Age • Miles Driven • Driver Gender • Martial Status • Type of Vehicle • Where Driver Lives • Driver’s Claim Record

24. Reduced Premiums-Page 346 • Good grades in school and in some cases drivers who have completed a driver education course. • No claims or convictions for three years. • Multiple vehicles insured under same policy. • Vehicles with certain safety features like airbags and antitheft devices.

25. Assigned-Risk Insurance-Page 346 • What is assigned-risk insurance? • Insurance provides bodily injury and property damage liability coverage to high-risk drivers for a much higher premium. • Must drive violation free several years before can qualify for standard insurance.

26. 16.3 Environmental Concerns-Page 347 • What are CFC’s • CFC stand for chlorinated fluorocarbon. • CFC’s are a freon gas located in the air conditioners units of vehicles. • CFC’s are effective in cooling air, but when freon is released into the atmosphere, they break down the atmosphere’s ozone layer.

27. Mass Transportation-Page 349 • Mass transportation is also known as mass transit. • What are some forms of mass transportation? • Car pooling or van pooling.

28. Alternative-Fueled Vehicles-Page 350 • What is an example of an alternative- fueled vehicle? • Solar-powered vehicles. • Capture light from the sun and transforms it into electrical power.