5 ms·
Just because you play golf, does not mean you wouldn't miss several hundred dollars. Golf is not really a poor man's sport, but neither is it polo.
by sliverstorm 12y ago
Just because you play golf, does not mean you wouldn't miss several hundred dollars. Golf is not really a poor man's sport, but neither is it polo.
- sokoloff 12y agoI can't shake this image of someone holding a $5 Starbucks in one hand, paying a $3 insurance premium to cover a less than 1 in 10K chance of losing $500 and complaining that they can't "afford to risk the $500". Let's see: you just paid $3 to hedge a risk with less than a nickel's worth of -EV and you're holding your daily Starbucks. I'm beginning to understand why you can't afford the risk... Yes, yes. I know I'd be erecting a strawman if the coffee was central to my argument. I don't think it is; I'm just trying to share my mental frame.
- sliverstorm 12y agoAh, but this is why insurance works- if you don't have a spare $500, the pain of a $500 payout is greater than $500. That's why, even though the liability multiplied by the probability is less than the premium, it can still make sense.
- Dylan16807 12y agoDo you have car and home insurance? All insurance has negative average payout.
- sokoloff 12y agoSince you asked: I have liability-only car insurance (and high limits at that) but not collision/comprehensive, as I can readily write a check for a replacement car. (My car is worth about $5K; my wife's car about $7K.) I have home insurance as I'm required by my mortgage to have it, but also because losing the house would be lifestyle-changing. I don't insure risks that wouldn't be lifestyle-changing (unless legally mandated). I'd wager that $650 for a round of drinks isn't lifestyle changing for most golfers. This insurance makes extended warranty plans for electronics a positively great deal in comparison...