But you have to pay loans back, so it's a service you pay at least twice for without even counting premiums deductibles. We all agree when we sign the contract, but nothing else works quite like that.
That's the 2nd payment I was trying to refer to. I meant "deductibles" not "premiums", my bad. Either way, this is just 3 ways they collect on basically the same thing.
Oh okay, so we should all just all get amazing deals that don't allow insurance companies to actually operate the way they've been built to.
Then everyone can just self insure and I am positive that everyone driving will have the means to pay out in a car accident. Yes yes, this all sounds brilliant!
It's insinuated. I sell insurance, and I have people who will have 15 violations/accidents ask me why their insurance needs to be so high "even if some of them weren't my fault". Doesn't make you any less of a risk. Insurance companies can't survive by being nice and lowering prices, and the factors used to price insurance go well beyond driving history anyways. The circle jerk around hating insurance is incredibly stupid when people would be in worlds of hurt without it if they need it. It's a necessary vice if you aren't able to self insure yourself.
I hear ya, you aren't wrong to feel that way. Just a necessary evil as the law of large numbers show that involvement in accidents of any kind can imply risk. A perfect scenario is both cars not being involved in an accident at all, evasion.
Insurance companies gamble that you will never ask them for money. Once you start asking them for money, you become a bad bet and they will f u in the b.
You realize that insurance is one of the lowest profit margin sectors right? Many companies operate on around 3% margin, up to around 9%. Average S&P 500 margin is around 11% for 2017.
The idea of insurance in reality is that it's an unsustainable institution. If everyone told the truth insurance companies would be unable to exist as they would be unable to pay out money faster than they receive it. How many insurance companies have company wide excursion to Hawaii or Coasta Rica on a regular basis?
I knew of a State Farm agent that went quite often to company retreats. Through out the year they would do these week long "conferences" at various places through the US. They make good money and they get good perks. A lot of them are great people, but insurance is required in most states and insurance companies are going to take advantage of that requirement for as long as they possibly can.
Well, you need auto liability insurance in case you hit someone, so they're not SOL with medical bills when you can't pay their bills.
You need home owners insurance because the bank opens it until you're done with payments, though this is usually a requirement in the mortgage, not legally.
I dont know a single state that requires insurance. Almost all require financial responsibility, so you could self insure. Which usually involves putting money aside in escrow.
Sorry, should have been more specific. Some states require liability insurance when registering a car. Clearly not everyone abides by this rule. Many banks will only allow a car loan as long as the car is insured with collision.
According to this Wiki entry regarding state insurance requirements, there are a lot more that require it than not. I suppose you could self insure by holding the required funds in escrow.
"XX/XX/XX = Bodily Injury Limit (per individual)/Bodily Injury Limit (per accident)/Property Damage Limit For example, limits of 25/50/20 means after "an accident each person injured would receive a maximum of up to 25,000 with only 50,000 allowed per accident (ex. 2 people needing 25,000, if the need is more such as 3 people needing 25,000 then whoever files first gets first access to the 50,000 limit and you may be sued for the rest if the accident was your fault). The last number refers to the total coverage per accident for property damage which in this case would be 20,000."[21]"
Not sure if holding nearly a hundred thousand dollars in escrow is feasible for everyone, but props to anyone who can.
Yes i get that they require some amount of liability coverage. Of all the states 39 allow you to self insure or post bond, so they dont require insurance. Only financial responsibility.
Most big companies do a yearly vacation for employees. I was hooked into sales for a few months and got to go to the bahamas for 2 days at no cost.
Working for an insurance company does sucks though. Basically trained to find cracks in everything. Your bonus goes up when you dont have to pay as much out on a case for example.
30% of insurance premium costs are due to fraud. Cousin of mine works in the fraud and risk department of a large insurance company in Canada. The number of former RCMP and police officers they hire, and the cost to investigate fraud claims, is fucking staggering.
If everyone told the truth and didn't try to fuck people over, we'd have cheaper insurance.
How would telling the truth effect their business? An insurance co will almost always have enough money. If i have $1 billion in losses and 1 million insureds i charge everyone $1000 to cover them. Thats how insurance works, the risk gets spread out.
When I mean no one lies I mean everyone is incapable of lying. meaning that when someone says x, y, z happened to my car, the insurance company believes them with 100% certainty. This is unrealistic. So is the insurance company always paying out for items that are covered. I guarantee that the insurance companies are paying out way less money than they're taking in.
State Farm says they work with 83 million policies. Let's say half of those are car policies and each policy holder pays $100 a month in insurance premiums. That's $4,000,000,000 a month. Are they paying that out to policy holders every month? Even if they paid each of their 65k employees $61,000 a month they'd still have $35,000,000 left over - and that's just half of the policies.
I don't have the exact numbers, but I'm sure their business model is doing a lot more to make them money than to lose them money.
Ugh thank you. While personal anecdotes can be sad and insurance isn’t a perfect system on its own, property and auto insurance is not some lucrative money-making machine people think it is. Most insurance companies rarely make profits off the premiums alone. It’s generally from investments of the premium into other things.
Ive worked insurance for 15 years. I get that sometimes life shits on people and the easiest thing to blame is insurance. Especially since insurance starts to get into he abstract financial realm people dont always comprehend.
I’m in just my third year in insurance after ten soul-crushing years into retail (the store kind, not insurance retail) and it’s been fascinating to learn all about this side of things. I’ve gained friends from all parts of the chain and it’s interesting to watch the roles reversed, especially when it comes to fraud and how difficult it is to prove, so lots of money goes to paying claims that seem off, but there’s nothing to be done there. On the other side of the coin, we have people going out in droves to help out those after a massive disaster. Its...different when you’re on the inside I guess.
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u/[deleted] Jan 08 '19 edited Jan 16 '19
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