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yes but you're legally required to have insurance so it's a game you have to pay
Quote:
People want to pay $100 in premium and collect $1000 in claims. The insurance company hopes to pay $100 in claims and collect $1000 in premiums. They are both gambling. The insurance I bought cost $2000 for 3 years. I would have never bought it if it was $5000.
I disagree with this the insurance wants to collect thousands in premiums and pay zero dollars in claims. And this is mostly how it works so if you ever have to make a claim keep it in mind. Also insurance companies don't make money by collecting premiums they take the premiums they collect and invest them and get a return on the investment.
I always love how insurance companies say you're in good hands or you're buying peace of mind no you're not. That's just a lovely to tell you something into paying them more. Most of the time God had to do with insurance I had to deal with other guys cuz I wasn't in fault for the wreak. And they treat you like an exs step child.
Isn't this what the insurance game is? People want to pay $100 in premium and collect $1000 in claims. The insurance company hopes to pay $100 in claims and collect $1000 in premiums. They are both gambling. The insurance I bought cost $2000 for 3 years. I would have never bought it if it was $5000.
I'll speak on both insurance and extended warranties:
WARRANTIES:
- It's not a game it's a hedge against PROBABLE repairs that may occur within a specified period of ownership. You have to know your own personal economic situation, as well as the general reliability of the car you're buying. It will either seem like a no-brainer or a hard pass. Anything in between, and you don't have all your data to make your decision.
A risk-averse person may only buy Toyotas. There isn't much help an aftermarket warranty can offer. Not many maintain coverage after 150,000 odometer miles, anyway. Things eventually WILL need replacing, but warranties generally don't cover wear-and-tear parts, and by the time you'd need engine or transmission work, the warranty would be out, anyway.
- ON THE FLIPSIDE: Someone who is really into, say, Jaguars or Range Rovers could benefit from an aftermarket warranty if the factory warranty has in fact lapsed. There are multiple systems that have a PROVEN history of failing early, prior to 100,000 miles. Air suspension (specifically compressors and the air struts themselves), timing chains (specifically tensioners), transmissions (specifically torque convertors, e-clutches, solenoids, and stator bushings) are KNOWN to fail before the first scheduled maintenance interval. There are NO maintenance schedule items for timing systems (it's a chain, not a belt) or suspension components. So "proper maintenance" is a very nebulous concept as it is not specified at any point.
INSURANCE:
- The economics of the equation changes when you have a mandatory product - insurance. I will entertain and comment on your above example:
Quote:
The insurance company hopes to pay $100 in claims and collect $1000 in premiums.
Sure. They'll take as much as they can get. Generally, safe drivers (and healthy people) pay premiums in excess of their claims. They support the insurance umbrella model and fund their own claims, as well as the claims of others in their risk pool. In the health insurance world, free wellness exams are offered for early intervention (prescription medications) on what could later be an expensive claim (cardiac surgery).
For vehicle (or home) insurance, it's quite the piecemeal system of micro economies. There are some at-fault auto insurance states, some no-fault states. Some states are must-insure while others are may-insure. Depending on how many people an insurance company is forced to cover, that they would otherwise not offer coverage, influences how they treat their next-riskiest group: the ones in the middle, who may not yet be out of the woods from their last claim, have a couple of points, and are paying an increased premium.
I had to deal with them as a service advisor at BMW. Yes, they did cover things. No, they didn't cover things. They didn't pay our labor rate and I passed it onto the customer.
I have car repair insurance, just not carshield. Paid $2000 for three year coverage when I bought a nice Expedition with 100,000 miles on it. Their brochure seems comprehensive but not really. I had a bunch of fluid leaks, hoses, belts etc. but they only paid for the water pump. I told the mechanic up front that I have insurance. He called them and deducted the cost of the water pump up front. I assume he'll get reimbursed for it. I suspect other shops may not bother. In another case, I had an engine miss costing me big time but they didn't pay. I just wanted to be covered for big ticket items, like transmission etc. I suspect they would cover those.
It is very unlikely they will cover something big. I have been a repair shop owner for 41 years and learned to not waste my time arguing with these scam artists.
It is very unlikely they will cover something big. I have been a repair shop owner for 41 years and learned to not waste my time arguing with these scam artists.
My Ally Premier Protection warranty has paid out, no problem.
But Ally is "allied" with GM and the work can only be done by GM dealers.
Fine with me, my Cadillac dealer is very good.
There so called insurance supposedly covers mileage only during good miles when least amount of trouble happens and if you were to read there 2 inch disclaimer at bottom of screen beware.
A shame. Normal people could watch that Ice-T commercial for Car Shield and spot it as a scam a mile away. But as the old saying goes, there's one born every minute....
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