Quote:
Originally Posted by stone hands
there's only 3 instances where you should get insurance:
1. you are forced to
2. you can't afford the consequences of not having insurance (house burning down, long term disability, etc)
3. if you are riskier than the average person in whatever field you are looking at insurance for, like if you're expecting a baby or something or enjoy street racing on the weekends
in most other cases you're far better off just banking the money you would be paying for something you will never use and pay for it out of pocket in the extremely unlikely chance that you actually require it. i only have liability on my vehicle because if it gets totaled...i will be able to buy a new one in cash and still come out ahead
its not entirely a scam, but its almost entirely unnecessary for most people
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There are other reasons as well, and if we're not limiting this to auto insurance, there are all kinds of tax/estate planning reasons to use insurance policies. The truth is that you can self-insure (as you've chose with not buying collision/comprehensive coverage on your vehicle), but insurance is just a mechanism to transfer that risk to another party.
And to be clear, the statement that "you're far better off banking the money" is questionable at best. There are plenty of times when you aren't far better off at all, specifically if a loss happens.