…on some level or the other. I was driving in to work today and just randomly started thinking about what insurance truly is.
Insurance is a bet, placed by you, that you will get sick. You are literally putting money down, against yourself, that you don’t think you can be well for the rest of your life. Honestly, it is probably a good bet really. Most people don’t go their whole life without having to go to the doctor for something, but still it seems a little pessimistic doesn’t it? It is also kinda sad how often when lose the bet.
Each month (or every six monthes, whatever) I put $100+ down saying that I think I will wreck my car. If I do wreck my car the bet pays off and I get back whatever the cost of the wreck is. If I don’t wreck my car, the house takes the money and I am no better off. The game starts over and I pony up some more cash. Whats even worse that going to Vegas is, that if it goes down that I win, the house then makes me bet more each hand, in order to stay in the game. The more times I collect on the bet the more I have to pay to play the game every month.
Health insurance is the same way. Place your bet every month, hope that you lose your money, because that means that you didn’t get sick.
Life insurance is off the charts on the “torques your mind scale”, because basically you are putting money down that you can’t ever win with. If you win the bet you are dead, if you lose the bet you are out the cash.
Think about it in another way even. If I pay $1200+ car insurance a year and I never wreck my car, in around 12-15 years I could just buy a new car with the money that I have paid the insurance company.