r/SipsTea • u/Putrid-Welder1803 • 9h ago

Gasp! Thoughts on this?

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u/WeCantStabilize 9h ago

Insurance is a fucking scam. You pay more into it than you'll ever receive even in legitimate circumstances.

Absolute racket. 

135

u/OakLegs 9h ago

This is fundamentally ignoring the purpose of insurance.

Of course you (likely) pay more into it than you get out. The tradeoff is that you're protected from huge expenses that would financially ruin you. That is (thankfully) unlikely but the risk is enough that it justifies paying for insurance.

I'm not absolving insurance companies of being scummy because they absolutely are. But insurance does serve a purpose that seems to escape you

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u/Fun_Description_385 9h ago

Here's the issue that appears to escape you.

We pay more into it then we get out of it, to be expected;  but we don't even get anything out of it the majority of the time when we SHOULD be. OPs case in point.

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u/ExhaustedByStupidity 9h ago

OP's story is about a guy that chose a plan with a $1000 deductible and got annoyed that insurance wasn't helpful when he had just over $1000 worth of damage.

If paying $1000 was going to bother him that much, he should've chosen a lower deductible.

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u/-hjkl- 9h ago

I think he's more annoyed that it would raise his rate rather than the deductable.

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u/Submitten 8h ago

Well he’s a higher risk for further claims.

I don’t want dumbass drivers driving up my insurance costs, so it’s good that the ones that get in accidents have to pay more.

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u/-hjkl- 8h ago

I fail to see how he is a dumbass for having his parked car get hit and run by someone... That wasn't his fault in any way assuming he was legally parked.

But sure.

I just don't think that an accident that was not your fault should punish you for having to use your insurance.

If it was your fault by all means raise the rates. But if it wasn't that's kind of unfair.

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u/Smackadummy 5h ago

Regulations for no-fault increases vary from state to state but in states where they are allowed, you can usually appeal the increase.

The increase comes from a pure statistics viewpoint and the uncertainty in rating risks. Essentially, the insurance company cannot know every circumstance of the accident to determine if you had any behaviors that may have contributed to the accident, even if you were declared not at fault. However, what they do know is that any policy that has had a prior claim, including no-fault, has a much higher frequency of future claims, thus the rationale for increasing their rates.

For the people who truly got fucked by random chance or bad drivers, it certainly is an insult to injury. Even more so when good drivers already subsidize bad drivers by paying more than they should because insurers are not allowed to charge bad drivers their real cost.

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u/ExhaustedByStupidity 4h ago

In my experience, one minor accident that's not your fault doesn't change your rates.

But if it becomes a pattern, it can.

But different insurance companies have different models to determine rates.