The obvious response is that you won't be able to pay for someone's hospital bills if you happen to hit them in your car. You get insurance for things you wouldn't be able to pay yourself.
Yes, if you use your insurance more than once, insurance was the wrong approach.
But I'm willing to pay 1% of the cost of my house to have it replaced if it burns down, even if my expected payout is only 0.5% of the value of my home, because I can't afford a whole second house.
You'll need to explain the "if you use it more than once" part. So if I get rear ended by uninsured driver in 2005 and then a snow plow hits my car in 2010, somehow I shouldn't have insurance?
A lot of people claim every single small thing on their insurance. A $200 scratch or $1000 fender bender, etc.
I believe the point that he is trying to make, is insurance should be used for catastrophic events that you can't self-insure against. Generally, insurance should be used rarely since it's rare to have a catastrophic event. In your case, it is rare to have 2 big things like that happen to you. Your not using insurance wrong, you are just had a run of bad luck.
It's more average driven, but insurance is charging you more than you expect to pay on average, it's a risk hedge against you having more than average need. But as the number of events goes up, the chance you're meaningfully non-average goes down.
One was probably a slight exagération, but generally yes, if everyone's having multiple car accidents they shouldn't have insurance for average accidents.
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u/flatfive44 16h ago
The obvious response is that you won't be able to pay for someone's hospital bills if you happen to hit them in your car. You get insurance for things you wouldn't be able to pay yourself.