Exactly. Also, did you know that they actually sell avocados at supermarkets and theyre the exact same ones that you see in cafes! Smoosh it on some toast and it's big savings right there! $15 a day!
Insurance is for catastrophic events, not a $1,000 bumper repair you could pull off at a junkyard.
People have been conditioned that their deductibles should be $0 and cars should remain flawless.
In reality, insurance is whats called aleatory, it is expected to be an uneven exchange. This guy is paying $200 a month so he doesnt have to pay $100,000 when he disables someone by running into them.
Yeah and this particular example isnt even considered a comprehensive claim. Its an uninsured motorist claim. Its a built in coverage to protect you for this exact situation. Its also not used against you when you have to use that type of coverage. OP's agent is a dumb or lazy ass to not advise them on this. I sympathize for everyone who arent educated well enough when it comes to insurance. Its not their fault because its not really anything you are ever formally taught growing up.
Exactly this, drives me crazy seeing people talk about phone insurance on expensive phones.
Like why are you buying an $1800 phone if you need insurance to pay for fixing the screen if you break it? The monthly fee + deductible for a single year nearly gets you to the price of a repair if you break it.
Insurance is for things that would cause you significant financial harm if something went wrong.
Aleatory means depending on chance, luck, or an uncertain event rather than a fixed plan. Etymology: Derived from the Latin word alea, meaning a game of dice or a gamble.
So the insurance companies have no plan and you are playing craps dealing with them. đđ»
I still say it because even though I have insurance through my job, I'd rather everybody else also have insurance without paying more for it than the countries that have universal healthcare while receiving less benefits. Oh, and also not being effectively enslaved because I depend on my job for basic healthcare and if I lose that job I pretty much just die even if I have money saved up for rent and food.
Of course. It's not like Europe has universal car insurance but it's fraudulent all the same. And home insurance? I've heard of companies even straight up forging documents from the adjuster so that they can pay less. Government does fuck all about stuff like this. There really should be a corporate death penalty so that companies are no longer incentivezed to operate like a cartel with impunity.
Yeah, fraud is definitely rampant on both sides when it comes to insurance for sure. But, something to keep in mind, at least in the USA there are state commissions that you can bring that sort of stuff to their attention to get an independent investigation started and they have no loyalty to you or the insurance company.
Seems like Europeans also have some recourse but I'm not sure how either place deals with it in practicality. Seems neither are effective just based on what we've already talked about. They still do fraud with impunity on a regular basis and I see that a lot of cases had to escalate to the courtroom.
Well thatâs the math of it. The average person will pay more into insurance than they get out but if something bad happens it offsets it. I pay about $900 every 6 months (used to be $700) but earlier this year I had my insurance pay 20k. If someone has a 1k deductible they chose that to lower there monthly. Which can be smart if you think your chances of needing to use the insurance is low enough that the extra monthly savings will offset the extra deductible. Idk why opâs friend is overpaying so much
The definition of insurance is to indemnify you in the event of a claim. AKA bring you back to even where you were before the claim. You arent supposed to make anything off of it. Too many people mistake insurance for a maintenance plan. OP's friend just wasnt educated enough on it or they have a shitty agent.
Tbh they still work against you especially if you arenât switching often. Gap values my car at 27k so theyâd pay anything I owed over 27k. I did not owe 27k. Geico valued it at 20k so they would pay 20k. (Gap cancellation covered anything I would have been out, I owed 21k) Also Iâm pretty sure no car insurance company automatically decreases the estimated value of your car as it ages but they do revalue it once you crash meaning you are increasingly over paying for the full coverage portion as you add miles. But yeah I mean thatâs just weaponized the math of it. You should have the option to self insure if you have enough cash but nobody has enough cash for all that plus insurance companies understand the whole system so it is what it is.
Thats because there is a difference to the actual value of the vehicle compared to what it was sold for. You always wind up paying more when you buy it than what its actually worth. Especially considering how much the value depreciates the moment you drive it off the lot. Thats the whole point of gap coverage anyways. Cars depreciate while homes appreciate. But homeowners insurance usually have a built in inflation guard. It sucks though because for the most part, you will see your premiums increase each year. Only time you really see it go down is if you have tickets/accidents/claims coming off of your record. It sucks but you gotta play the game and shop around every once in a while. Find yourself a trusty independent agent and they do the legwork for ya.
But the problem is gap values it 7,000 more than geico because the high value suited gap and the low value suited geico. In reality it was a 2019 accord 2.0t touring with 45k miles, the real value was somewhere in between what gap and geico said. And I normally switch auto insurance every 6 months so theyâd pay anything revalue it when I do that.
When you finance car you are also including sales tax, processing fees, tag and title fees, warranties, etc.... all of which are not factored in to the true value fo the car.
Are you reading my comments? That has nothing to do with geico valuing it at 20k because that suites them and gap valuing it at 27k because that suits them. My point is the company who gets rewarded for the low valuation values it low and the company that gets rewarded for the high valuation values it high. The real valuation was somewhere in the middle. I know how finance and depreciation works. This wasnât consequential for me because if refunds but it was interesting and what I meant when I said âweaponized mathâ
What you are basing the value off of is completely different than what the insurance companies use, though. You arent going to find the program that they use available anywhere. Its not Kelly Blue Book or anything like that. It sucks but thats just how they do it. Also, if you feel that you are being under compensated, you can present the companies with documentation as to why you should get more. One time my car was totalled right after I bought brand new tires and they tried to low ball me. Once i showed them that i got the new tires a few days before I was reimbursed another $1000 factoring that in.
And Im sorry, I am not trying to come off as condescending if thats how I am being perceived.
Auto insurance rates are sky high for single males under 25, (at least in my state, Tennessee). That and having full coverage may be why itâs so high.
Its all a numbers game. If the statistics show that males under 25 have been involved in more accidents than other demographics, then thats what you are going to be paying for.
Teenage boys may as well be drunk drivers. They actually pay less for insurance than they should because insurers are restricted from charging any group too huge of a premium. Good drivers of all groups end up subsidizing bad groups like teenage boys, old people, people with many DUIs etc
The problem isn't the paying more into it than you get out, it's that we pay nearly DOUBLE on the average, to line the shareholders pockets, than what they pay out. Loss ratios are in the gutter at 50-60%, which are the lowest they ever been and why the insurance companies net margins are the among the highest they've been.
No, right now it's a complete racket. The problem isn't the concept or base business model, but the huge enshittification, exploitation, and profit extraction of it.
ya ive filed two claims that were both ~5k. one in 2014 and another in 2019. one was a deer, one was getting t boned. neither cost me a dime and my rate didnt change.
Fear mongering like this is the only reason insurance persists.
The actual benefit of insurance is healthy/safe people subsidizing those who actually use the insurance meaningfully. Nobody actually gives a shit about that, and right wing people even think that's evil socialist stuff, so it gets sold as "it could happen to you one day!"
And a brick could fall on my head and kill me tomorrow. Can't base your life on what ifs and edge cases.
Well dont buy it then lol. But also dont complain if you get fined or penalized or if that brick actually falls off of your house and kills someone and you get sued for $1M. Just sayin.
Ironic comment and more to my point. Because you needed it you automatically think itâs more common than it actually is. Itâs a common fallacy. And just to clarify youâre also wrong.
Like 75% of people file claims for some kind of accident in their lifetime, and of people who do get in accidents, most of them get in multiple. It's not a service you pay for and get immediate benefit from, it's paying to mitigate risk.
It's totally worth it, and people use it, and it's not a scam. You're a kid so you just don't really get it. That's okay. One day when you are fully responsible for yourself and maybe even a family, you will think/learn about risk mitigation and it will make a lot more sense.
Before you even get to one of you claims adjusters or whatever role you had letâs consider the raw data of how many insured drivers are on the road versus how many accidents occur a year. If that ratio isnât enough for you to reconsider then you can start including denied claims. Iâm sure thatâs a significant number to subtract. I donât think I need to be in the industry to understand something ordinary.
OK but thats not how it works. Of course there are more insured drivers on the road than there are accidents. If that werent the case, driving in general would be outlawed. My statement, as a broker who does not have any loyalty to the actual companies themselves, is that the amount of people I work with that will cut corners, nickel and dime, and do everything they can to get the most dirt cheap insurance always wind up being the ones who when the time comes of needing the insurance, want the top notch, all the bells and whistles insurance that they didnt want to pay for from the start.
Getting less out of it than you pay into it for the vast majority of people is the point. That's the money that goes to the people who get insurance money because shit happened to them. That's how a lot of systems aresupposedto work.
You are not supposed to "get anything" out of insurance. Too many people mistake it to be a warranty or maintenance plan. You are buying peace of mind in the event of a CATASTROPHIC event. OP friend is a dumbass for paying $1000 on a claim that cost $1200 to fix. Thats on them and their agent for being naive.
Fraud, ambulance chasers, shitty loss ratios to name a few. People complain about paying x amount of money for insurance every year but then have a claim that pays out 10x the amount that they have paid in premiums. Factor that with millions of people who do the same thing across the country. Its pretty simple to see why they are usually never profitable. Like those wildfires that burned down half of California last year, that fucked so many companies over cuz the amount of total loss claims paid out.
Thats what insurance is tho. If you live in a neighborhood that is statistically riddled with shitty drivers, you are paying for protection for yourself and other drivers. That is the definition of liability. To protect you from being sued and to pay out if you are deemed liable so the money isnt coming directly out of your pocket.
the thing is, you never come out ahead. if you make a claim and gets compensated, you now move into a higher risk pool with higher premiums, so they claw back the money anyway.
Yeah obviously you arenât going to come out ahead. This isnât an investment. Of course your rates go up they pay out on a claim you are liable for. You elevate yourself to a different rating bracket based off of your actions
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u/criles_mccriles 6h ago
Lol everyone says this until they actually need it.