From the insurance company’s perspective , you use your insurance each time you get in your car and drive around. For your $400 payment per month, the insurance company may provide you with a certain amount of coverage. Let’s say you have 100 / 300/ 100 . That means each time you’re driving around you have a bucket of money that is essentially hovering over your car that will pay if you’re at fault and liable for someone’s injuries or property damage. So for that $400 you pay, the insurance company will pay up to $100,000 for any one person you injure, a total of $300,000 for a total injuries in an accident, and up to $100,000 if you damage somebody’s property. It’s obvious that I work in the insurance industry, and I hear that argument every day from customers calling in. I get it because I thought about it the same way before I learned how insurance actually works. So you do use your insurance each time you drive , not just when you have to make a claim. Now a lot of cost from insurance is due to fraud, you know somebody who had an accident who had something else fixed that was already broken on their car before the accident. Those type of things add up and do raise the cost of insurance tremendously. But I get how it seems like a scam to the consumer. Now if you’re super rich, you can self-insure, you can have enough money to put in an escrow account that the state insurance has control over and that money sits there and will be paid out when you have an accident.
From the insurance company’s perspective , you use your insurance each time you get in your car and drive around. For your $400 payment per month, the insurance company may provide you with a certain amount of coverage. Let’s say you have 100 / 300/ 100 . That means each time you’re driving around you have a bucket of money that is essentially hovering over your car that will pay if you’re at fault and liable for someone’s injuries or property damage. So for that $400 you pay, the insurance company will pay up to $100,000 for any one person you injure, a total of $300,000 for a total injuries in an accident, and up to $100,000 if you damage somebody’s property. It’s obvious that I work in the insurance industry, and I hear that argument every day from customers calling in. I get it because I thought about it the same way before I learned how insurance actually works. So you do use your insurance each time you drive , not just when you have to make a claim. Now a lot of cost from insurance is due to fraud, you know somebody who had an accident who had something else fixed that was already broken on their car before the accident. Those type of things add up and do raise the cost of insurance tremendously. But I get how it seems like a scam to the consumer. Now if you’re super rich, you can self-insure, you can have enough money to put in an escrow account that the state insurance has control over and that money sits there and will be paid out when you have an accident.