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> It's a disgusting practice, IMO - but what can you do? Rate the expected value of all insurance services at $0, that's my approach. (I guess you could call
by marssaxman 4y ago
> It's a disgusting practice, IMO - but what can you do?
Rate the expected value of all insurance services at $0, that's my approach. (I guess you could call that giving up on step zero!) Why bother doing business with people whose profit model consists of taking your money now so they can decline to return it later? The better they are at their jobs, the worse a deal it is for you.
- mdavis6890 4y agoOf COURSE insurance has a negative expectation (not $0) in absolute terms - but this doesn't make it a bad idea! We don't live on expected value - we live on actual, highly variable outcomes. I'm happy to lose expected value to offset catastrophic losses for small-probability events, like early death, car accidents and fires. I will continue happily paying my insurance premiums, and ardently hope that I never get any of that money back. Of course, there may be specific types of insurance/warrantee programs that are a bad idea for one reason or another, but that's not an argument against insurance in general.
- noelsusman 4y agoThe expected value of purchasing insurance is always less than $0. You're paying to eliminate a risk and smooth out your cash flow.