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I've got pretty good personal injury and uninsured motorist protection, but aside from the mandatory liability insurance, that's all. On average, insurance doesn't pay off in the long run. The value of insurance is a matter of probability, and the probability is favorable compared to the cost of comprehensive insurance. Since the odds are in my favor I'm more than willing to take my chances to save a fairly considerable chunk of change. I only insure things I can't afford to lose, such as my health.
One way to look at comprehensive insurance is as though it was a payment plan. It's like non-refundable, prepaid auto body repair. The insurance company estimates how much you're going to cost them in the long run, and they charge you at a monthly rate that should cover that - plus a little extra to make it profitable. The only customers that actually benefit substantially from comprehensive insurance are the ones who use it frequently. Naturally, these customers tend to be charged progressively higher rates until eventually the insurance companies level the field again. The extra charge to make their business profitable is part of the expense that is essentially wasted because you don't ever recoup that, but there's another expense most people don't consider. Most people, when presented with the cost to repair damage to their vehicle, usually elect to forgo the repairs when the money must come directly out of their pocket. Sometimes this is because they can't afford it, but often it's because they feel that it's simply not worth it. When the money comes directly from the insurance company however, they have no problem spending it - they've already paid for it so they might as well spend it. The truth is that indirectly the money still comes out of their own pocket - it just passes though a middleman first, who takes a little (or a lot) off the top before passing it along. Now, if you've already paid into the insurance company, you might as well get your money back out, but it's even smarter to not pay into the pool in the first place, and instead to pay for the repairs directly when they're needed. This also allows you the opportunity to decide at the time repairs are needed that the repairs are not worth the expense, instead of having to commit to them before you even know what they are.
I fully insured my SVX with very generous coverages and low deductibles for six months when I first purchased it. I figured that I was going to do something stupid, the probability was greatly biased towards something bad happening sooner rather than later. Statistics show that after one year, the odds of oops are cut approximately in half. The 50% figure is actually a very broadly applicable statistic, as a one-year "statistical half-life" applies to quite a few things including vehicle damage car accidents, injury accidents, fatality accidents, motorcycle accidents - even gun accidents, airplane accidents, workplace accidents, and so on. The odds of getting into an accident are highest on the drive home from the dealer. If you've made it past the first few months, you're almost on easy street. After my six months was up, I didn't renew the comprehensive. My insurance company didn't like that very much because their rates are figured based on the term of a normal car loan which is much longer. Had I needed the coverage within the first six months I would have come out way ahead by several times. Had I needed the coverage during a three year time span, I would have paid more than twice what the maximum pay out would have been.
As for covering against other people, that's a different story. The bulk of the cost for comprehensive insurance covers you. The biggest expense for insurance companies is their own customers.
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