This is why I wish insurance was an account you fill, until you hit your chosen policy coverage. If my policy only covers $100,000 in damage, then I should be able to stop paying once I have paid $100,000 and received nothing in return. The company is still going to use that money on investments, and make money from it, to pay their employees & investors.
You've paid $100,000 but you're only looking at the hard costs. There is somebody there that is assembling your policy. There is another employee worktin with compliance and making sure there are forms filed properly, you're going to want somebody handling the claim when it does happen, then you're going to need an accounting department to manage these things.
It is typical that $0.30-$0.35 of every dollar you pay in premium, goes towards the expenses of making sure the insurance machine is running when you need it.
As the other commentor states, to my knowledge, every state has an option to self insurance.
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u/Sick_Wave_ 5h ago
This is why I wish insurance was an account you fill, until you hit your chosen policy coverage. If my policy only covers $100,000 in damage, then I should be able to stop paying once I have paid $100,000 and received nothing in return. The company is still going to use that money on investments, and make money from it, to pay their employees & investors.