Introduction to Insurance for Kids’ Financial Literacy
This video explains the concept of insurance in a simple, concise way for kids and beginners. It could be used by kids & teens to learn about insurance, or used as a money & personal finance resource by parents and teachers as part of a Financial Literacy course or K-12 curriculum.
Suitable for students from grade levels:
- Elementary School
- Middle School
- High School
The topics covered are:
- What is insurance
- What is covered by insurance
- How does insurance work
- How much does it cost
- Does the insurance premium change over time
- How long is the insurance cover valid for
- Who should buy insurance
Howdy Wall Street Willie. I heard my friends talk about insurance.
What is insurance anyway?
Well, insurance is something that protects you financially against a loss, which means that if something goes wrong, the insurance company will pay you.
Well, what can be covered by insurance?
Anything of value can be covered by insurance.
For example, a house, the contents of the house or whatever’s inside the house, a car or someone’s life.
Also, piano players – since their fingers are very important – they can cover their fingers with insurance, and soccer players’ legs are very important so they can cover to their legs with insurance.
Ha ha, that’s funny!
How does insurance even work?
Well, you pay a premium or amount of money to the insurance company, so that the insurance company can pay you if whatever you have insured gets damaged, destroyed or stolen.
You also have to file an insurance claim to let the insurance company know that something has happened.
Well, is insurance really expansive?
It depends on what you insure and the kind of insurance.
For example, home insurance that covers fire and theft won’t be very expensive. But if you also add insurance for flooding in a coastal area or area around a river, it can become more expensive.
Does the amount of money that you pay to the insurance company, or premium, change?
Again, it depends on the kind of insurance that you have.
Because in life insurance, the premiums usually will not change from one year to another if you have bought it for a long term.
But for other kinds of insurance, like home insurance and car insurance, the rates or premium can change every year. And the insurance premium usually will go up after you make a claim or tell the insurance company to pay you because whatever you have insured gets damaged destroyed or stolen and they pay you.
How long is the insurance cover valid for?
Well, how long are you gonna be covered for?
Like, will the insurance company pay you if something happens forever, or just for a certain amount of time?
Well, the insurance company will pay you for whatever amount of time you have bought the insurance for.
For example, life insurance can be bought for many years, but most other kinds of insurance are bought for a year and they’ll need to be renewed or paid again every year.
Who should even have insurance?
Everyone should have insurance. And depending on what you own and whether you have any dependents, you can have different kinds of insurance or multiple kinds of insurance.
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We’ll cover each type of insurance in detail another time…
Thank you very much for telling me about insurance, Wall Street Willy.
You’re welcome, Sooper Cooper. Remember, finance is your friend!
Video Featured in the Below Financial Literacy Courses for Kids and Teens
Download Transcript: Ideal for Use by Teachers in their Lesson Plan to Teach Kids and Teens
Podcast: What is Insurance?
Fun, informative and concise episodes by a 10-year old, breaking down complex financial concepts in a way that kids and beginners can understand. Episodes cover personal finance topics like saving, investing, banking, credit cards, insurance, real estate, mortgage, retirement planning, 401k, stocks, bonds, income tax, and more, and are in the form of a conversation between a cowboy (a finance novice) and his friend, a stock broker. Making finance your friend, only at Easy Peasy Finance.
A little bit about me: I have been fascinated with the world of personal finance since I was 6! I love to read personal finance books, and keep myself updated on the latest by reading various personal finance magazines. My friends often ask me questions about finance because they find it complex and intimidating. That’s what inspired me to start my YouTube channel called Easy Peasy Finance when I was 8, and this podcast 2 years later.
All about basics of insurance: what is insurance, different types of insurance, what can be covered by the insurance, how does insurance work, what is premium – is insurance really expansive, does the insurance premium change over time, how long is insurance cover valid for, who should have insurance, and more. Show notes and transcript at: https://easypeasyfinance.com/what-is-insurance/