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> Personal liability in an accident is potentially unbounded. This is an example of an unbearable loss that must be protected against, even if it costs money on
by SlavikCA 6y ago
> Personal liability in an accident is potentially unbounded. This is an example of an unbearable loss that must be protected against, even if it costs money on average.
Why it is "unbearable loss"?
There is saying about that:
If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem.
That may seems unethical, but if you think about it - it's reach people, who lives in our society, who needs to be careful to take care of their risks.
Of course, if you have assets to lose - you need to protect them (by buying insurance), but if you are "individual with limited resources" - it's not much different with / without insurance.
What I often hear is that poor people (with limited resources) needs to buy extra insurance to protect reach people from their risks. I disagree.
- triceratops 6y agoIf you're rich enough to not need collision & comprehensive insurance (i.e. you can put down a few thousand dollars to buy a car at short notice) you probably have assets worth protecting with liability insurance.
- ska 6y agoThey were pointing out that liability in the case of a car crash could claim approximately all of your assets, where as a comprehensive loss can at most claim the current value of your car. You have a good point though that if you have essentially no assets to go after liability insurance isn't worth much to you. This is why it is mandated for auto insurance (and why many places have underinsured motorist insurance, also)