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I don't fault him for not insuring his own car against damage. It could be a wise financial decision for low priced cars. I don't pay more than $3k or $4k for my daily drivers and I don't pay for damage coverage. I do, however, put the savings in the bank to cover that one long shot accident where I have to fix or replace the car myself. I'm saving a lot more than $350 per year, probably 2 or 3 times that amount and have already accumulated at least enough to replace my current car. And if that one long shot accident never happens I am way ahead of the game.
By the way, with 35 years in the insurance industry I am well educated about it.
Smart move- you live below your means as I do.
I buy a 1-2 year old car in great shape and pay cash. I then drive it at least 10 years and then do it all over again every 10 years.
My dad taught us (he was an M.D.) to NEVER FINANCE DEPRECIATING ASSETS!
God help you if you get hit by one of these clients from non standard companies and need extensive medical care. Usually their policy are low end, bare bone coverage.
I would never have insurance with the General simply because I am unaware of them writing a policy in my state, Utah, that is for more than minimum limits. I'm insured for much more than that.
I will say this. I have dealt with the General over some bodily injury liability claims and they actually better claims service and evaluation than companies I rate in the third or bottom tier of insurance companies. In other words, I have found them more reasonable than Allstate, Progressive, Farmers and GEICO.
I am not crazy about people who will only have minimal limits coverage ("full coverage" is what they like to call it) but I would rather they have minimal limits than no coverage at all. Frankly, I would rather they have coverage with the General than with one of the aforementioned companies.
I don't fault him for not insuring his own car against damage. It could be a wise financial decision for low priced cars. I don't pay more than $3k or $4k for my daily drivers and I don't pay for damage coverage. I do, however, put the savings in the bank to cover that one long shot accident where I have to fix or replace the car myself. I'm saving a lot more than $350 per year, probably 2 or 3 times that amount and have already accumulated at least enough to replace my current car. And if that one long shot accident never happens I am way ahead of the game.
By the way, with 35 years in the insurance industry I am well educated about it.
He lived paycheck to paycheck so this wasn't a save on insurance and bank the savings. Subsequently he got a pair of DUI's after I let him go. 2nd one was "with injury" so the other party got a judgement on him after exceeding his liability limits. Insurance really would have been beneficial to him had he been covered properly.
His last 3 cars were all well worth carrying full coverage and 2 of the 3 were definitely a theft risk.
I had an employee that despised insurance. He always had the lowest coverages allowed by the state with the expectation he would be paying the least he could.
He got into a sideswipe collision with an 18 wheeler in the rain, the 18 wheeler kept going and his car was wrecked pretty good. So he spent a few thousand fixing it. I asked how much full coverage would have been, he inquired only to find out it was like $350 a year more than he paid for base coverage.
So after the accident I asked if he was going to spend the extra $350.......he said he already had the one long shot accident so now it would be a waste of money! Some people don't learn.
I suspect "the General" makes plenty of money off their uneducated clientele.
Insurance is generally a waste.. He has the right idea. He shouldn't have gotten in that accident, though.
I buy a 1-2 year old car in great shape and pay cash. I then drive it at least 10 years and then do it all over again every 10 years.
My dad taught us (he was an M.D.) to NEVER FINANCE DEPRECIATING ASSETS!
Read the book "the Millionaire Next Door" and you will see that MD's are usually the worst at financial responsibility!
There is nothing wrong with financing a depreciating asset if you have the cash to make up the difference in the event of an issue. Plenty of people quickly learned that real estate could be a depreciating asset in the last decade and lots of them had hundreds of payments left on that same real estate!
Insurance is generally a waste.. He has the right idea. He shouldn't have gotten in that accident, though.
We generally drive slower in the rain now.
Insurance is transferring your risk to another party in exchange for a fee (premium). So just like gambling on a long shot, if it "hits" then you collect your winnings or hand them a bill for "damages."
The problem is: You don't have a limit on what the damages will be! So if you drive a 10K used car and you are only responsible for your car, then your "potential loss" is only 10K. But if you hit someone else and they sustain serious injury then suddenly you are out your 10K car, their car plus their medical costs.......the total could be hundreds of thousands!
My house is paid for, I can easily go with no insurance and I would save $6,000+ a year. But if the place burns down I get nothing. If I live here 30 years, save 180K in premiums that is still not enough to rebuild even a section of the house after a kitchen fire. The risk (the value of the house) is not worth the reward (saving the $6000 premium).
I have friends that live in a 3mm home with no insurance. The house is older and if something happened the land is basically worth 3mm so they feel if something happens then they will just sell the land. Their insurance would be 25-30K a year due to the location. This is a risk I would take, knowing that it is basically a break even but there is still a risk due to the fact your cash is still tied up in the land until you find a buyer. If the market is down (lets say you can't sell it for more than 2mm) you have to hold the land until the market rebounds yet you don't have a place to live anymore.
Insurance is transferring your risk to another party in exchange for a fee (premium). So just like gambling on a long shot, if it "hits" then you collect your winnings or hand them a bill for "damages."
The problem is: You don't have a limit on what the damages will be! So if you drive a 10K used car and you are only responsible for your car, then your "potential loss" is only 10K. But if you hit someone else and they sustain serious injury then suddenly you are out your 10K car, their car plus their medical costs.......the total could be hundreds of thousands!
My house is paid for, I can easily go with no insurance and I would save $6,000+ a year. But if the place burns down I get nothing. If I live here 30 years, save 180K in premiums that is still not enough to rebuild even a section of the house after a kitchen fire. The risk (the value of the house) is not worth the reward (saving the $6000 premium).
I have friends that live in a 3mm home with no insurance. The house is older and if something happened the land is basically worth 3mm so they feel if something happens then they will just sell the land. Their insurance would be 25-30K a year due to the location. This is a risk I would take, knowing that it is basically a break even but there is still a risk due to the fact your cash is still tied up in the land until you find a buyer. If the market is down (lets say you can't sell it for more than 2mm) you have to hold the land until the market rebounds yet you don't have a place to live anymore.
I get that, but I find an attraction to the "risk-taker." You miss 100% of the shots you don't take. Won't get rich by not taking risks. And, while I make fun of fast food and chains/franchises for "how stupid they are" in being cheap.. I employ similar thought processes when confronted with this whole "Insurance is great" thing.
I love it when people say "You can't control what happens to you on the road." While this may be technically true, it really isn't. You can almost always allow yourself a way out of disastrous things. It may require more careful driving, maybe driving less fast, maybe being more alert, (and, to your credit, no, it is not 100% fool-proof.) But, accident-wise, almost always avoidable.
Now, if you get pulled and you don't have insurance, then okay, a lot of things happen. That too.
But, you can't tell the poor man that money won't solve all his problems and expect him to listen.
Maybe, years from now, when insurance is like $100 a month and you're making 5 figures and it's like "Oh yeah, that," then you can point to people like me and be like "Look at that idiot, he thinks Insurance is a scam." Well... from what I have seen, they should give you your money back if nothing happened. They just won't get it from me.
If insurance isn't a scam... Then give the money back if nothing happens.
I would also unplug stuff, to avoid a kitchen fire. And pray lightning doesn't strike.
I also don't have a 997S.
But... I maintain that insurance is generally a rip, and those that like it tend to be insurance agents and cops.
Hope this helps!
(And you can make fun of me all you want.. I don't care. If I ever get caught driving with no insurance, then i'll spend the money on what insurance would have cost on a lawyer. I am genius-level thinker.. Sorry if this does not gel with societal norms.) Love y'all, and thanks.
I buy a 1-2 year old car in great shape and pay cash. I then drive it at least 10 years and then do it all over again every 10 years.
My dad taught us (he was an M.D.) to NEVER FINANCE DEPRECIATING ASSETS!
Which is why you shouldn't get financial advise from your doctor. Now that 0% is going away, there's less reason to finance. I may pay cash for my next car. 0% vs $1,500 cash on the hood, 0% was a better deal so I financed. It's still not no reason because cash flow and vagaries of market timing, but it's more attractive to simply pull the money out from equities if you have them available. I have enough to do that but most of it is in an IRA so I can't get at it without penalties. By depleting my emergency fund and putting in less to the IRA for a few years though, I could. It may be what I do. I'm not planning on buying another car for at least another few years.
I get that, but I find an attraction to the "risk-taker." You miss 100% of the shots you don't take. Won't get rich by not taking risks. And, while I make fun of fast food and chains/franchises for "how stupid they are" in being cheap.. I employ similar thought processes when confronted with this whole "Insurance is great" thing.
I love it when people say "You can't control what happens to you on the road." While this may be technically true, it really isn't. You can almost always allow yourself a way out of disastrous things. It may require more careful driving, maybe driving less fast, maybe being more alert, (and, to your credit, no, it is not 100% fool-proof.) But, accident-wise, almost always avoidable.
Now, if you get pulled and you don't have insurance, then okay, a lot of things happen. That too.
But, you can't tell the poor man that money won't solve all his problems and expect him to listen.
Maybe, years from now, when insurance is like $100 a month and you're making 5 figures and it's like "Oh yeah, that," then you can point to people like me and be like "Look at that idiot, he thinks Insurance is a scam." Well... from what I have seen, they should give you your money back if nothing happened. They just won't get it from me.
If insurance isn't a scam... Then give the money back if nothing happens.
I would also unplug stuff, to avoid a kitchen fire. And pray lightning doesn't strike.
I also don't have a 997S.
But... I maintain that insurance is generally a rip, and those that like it tend to be insurance agents and cops.
Hope this helps!
(And you can make fun of me all you want.. I don't care. If I ever get caught driving with no insurance, then i'll spend the money on what insurance would have cost on a lawyer. I am genius-level thinker.. Sorry if this does not gel with societal norms.) Love y'all, and thanks.
I view people who drive without insurance as thieves.
The rest of us who obey the law are required--for good reason--to have liability insurance.
Those who drive without insurance aren't paying into the pot, but yet are still utilizing our roads and highways.
The difference though between an ordinary thief and someone who drives without insurance is that ordinary thieves are generally less blameworthy. If someone swipes a $20 item at Walmart, Walmart will not feel it much. At worst, they will modestly raise prices. Someone who drives without insurance and causes a serious injury or fatal accident leaves that person or their family in a major predicament. Medical bills, lost wages, and permanent disability need to be compensated. If the party causing the accident does not pay, generally the state will through medicaid and public assistance.
I view people who drive without insurance as thieves.
The rest of us who obey the law are required--for good reason--to have liability insurance.
Those who drive without insurance aren't paying into the pot, but yet are still utilizing our roads and highways.
The difference though between an ordinary thief and someone who drives without insurance is that ordinary thieves are generally less blameworthy. If someone swipes a $20 item at Walmart, Walmart will not feel it much. At worst, they will modestly raise prices. Someone who drives without insurance and causes a serious injury or fatal accident leaves that person or their family in a major predicament. Medical bills, lost wages, and permanent disability need to be compensated. If the party causing the accident does not pay, generally the state will through medicaid and public assistance.
Only lowlifes drive without car insurance.
Yep, Lowlifes of the highway. If the truth was known, they cant afford it, but act as if its a ripoff and refuse want to pay it. But drive, drink and drive on our dollar. its your misfortune, when you look in the mirror and dont see a fool, but our misfortune when you hit us.
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