{"items": [{"author": "Michael", "source_link": "https://www.facebook.com/notes/jeff-kaufman/insurance-doesnt-make-sense-if-you-have-savings/495656391212/?comment_id=495659256212", "anchor": "fb-495659256212", "service": "fb", "text": "(1) A lot of insurance has a health insurance component. Auto, home, renter's: these can all cover medical treatments. (2) A lot of insurance insulates you from having to get a lawyer in various circumstances, since an injured third party's lawyer or insurer will often be willing to negotiate with either your insurance company or your lawyer, but not with you directly.", "timestamp": "1297526883"}, {"author": "Jesse", "source_link": "https://www.facebook.com/notes/jeff-kaufman/insurance-doesnt-make-sense-if-you-have-savings/495656391212/?comment_id=495671336212", "anchor": "fb-495671336212", "service": "fb", "text": "Not strictly true - the missing component is risk. While the average is indeed a negative value to consumers, an individual incident may well cost more than a given person could reasonably save. Having insurance limits the spikes in costs which can be individually devastating (fire destroys entire apartment/house), while spreading that cost around to all the people who had no incidents or minor incidents.
On small things it's certainly not worth insurance. I'll buy another camera, laptop, etc. But where the cost is potentially very high there is still a valid reason for an individual to prefer insurance.", "timestamp": "1297528578"}, {"author": "Jeff Kaufman", "source_link": "https://www.facebook.com/notes/jeff-kaufman/insurance-doesnt-make-sense-if-you-have-savings/495656391212/?comment_id=495672736212", "anchor": "fb-495672736212", "service": "fb", "text": "\"While the average is indeed a negative value to consumers, an individual incident may well cost more than a given person could reasonably save.\"
Right. That's what \"as long as we can afford to re-purchase all our stuff out of savings\" was supposed to indicate.", "timestamp": "1297528735"}, {"author": "Jesse", "source_link": "https://www.facebook.com/notes/jeff-kaufman/insurance-doesnt-make-sense-if-you-have-savings/495656391212/?comment_id=495673286212", "anchor": "fb-495673286212", "service": "fb", "text": "True. Just.. that's a high bar when it could include your home.", "timestamp": "1297528849"}, {"author": "Andy", "source_link": "https://www.facebook.com/notes/jeff-kaufman/insurance-doesnt-make-sense-if-you-have-savings/495656391212/?comment_id=495680061212", "anchor": "fb-495680061212", "service": "fb", "text": "I agree with Jesse that reducing risk is the big reason for insurance on costs that you can but would strongly prefer not to incur - like all the possessions in your apartment, which renter's insurance covers - where risk is defined, as in finance, as variability of return. If I'm analyzing this correctly, it's like how adding some bonds to a portfolio of stocks can increase your long-term net returns, despite bonds consistently having lower long-term returns on their own, because they reduce variability. (Of course, you have to re-balance periodically, for instance taking money out of bonds to add more to stocks when stocks go way down.)
But insurance is pointless for things whose cost is small enough or which aren't necessary to replace, like the \"extended warranty\" on an iPod, and required for things whose cost is large enough, like a house for most house owners.", "timestamp": "1297529952"}, {"author": "Mac", "source_link": "https://www.facebook.com/notes/jeff-kaufman/insurance-doesnt-make-sense-if-you-have-savings/495656391212/?comment_id=495714881212", "anchor": "fb-495714881212", "service": "fb", "text": "Simply put, insurance covers bets you cannot afford to lose. But insurance companies run profits, which are the house take on your bet. So I have medical insurance, but not dental, because the dental costs are predictable, affordable, and generally cost less than the insurance. I have made out on $50 deductible cell phone insurance, and I recently bought road hazard insurance at 50% off for my new Michelins.", "timestamp": "1297535908"}, {"author": "Cortland", "source_link": "https://www.facebook.com/notes/jeff-kaufman/insurance-doesnt-make-sense-if-you-have-savings/495656391212/?comment_id=496568941212", "anchor": "fb-496568941212", "service": "fb", "text": "Jeff, consider also the collective bargaining / cartel factors that Michael describes. As well, some of my apartment leases have required renter's insurance of some minimum amount.", "timestamp": "1297694376"}, {"author": "Jeff Kaufman", "source_link": "https://www.facebook.com/notes/jeff-kaufman/insurance-doesnt-make-sense-if-you-have-savings/495656391212/?comment_id=496582431212", "anchor": "fb-496582431212", "service": "fb", "text": "@Blake: I've not heard of an apartment lease requiring insurance; none of mine have. But I can see why a landlord might require it.", "timestamp": "1297696617"}]}