Day #9 - Insurance

Ooooo.........what to say, what to say...

Ah yes, insurance.  Probably tops my personal list of "Best thing to waste your money on", easily.  Someone (or some corporate entity) really had their brains running in 4th gear when they thought of this little gem.

I'm sure to raise a few heated defenses to the good of insurance with this statement.  But really?  Let's talk.

Let's start with the fact that I'm from the town where Insurance is King.  Des Moines, Iowa.  Home to such biggies as "The Travelers"..."State Farm"..."Allstate"...."Nationwide"..."American Family", plus a host of others.  Our state's capital city lives, eats and breathes insurance, so I like to think I know a little about it.  Add to that the fact that I've been dumping my cash down the toilet for a number of insurance agencies all of my life.

Here's the thing though, I've never had a case where I've been able to use or benefit from it at all over my lengthy life.  I've never been involved in anything bigger than a fender bender as far as my vehicles are concerned (although, while I had only basic liability on my vehicles, I had a van flip upside-down on a truck of mine at 1:30 a.m., while the police were in hot pursuit, and I wasn't in the vehicle at the time...then 3 weeks later, I had a guy plow into my van's rear end, and he wasn't insured.  In both cases, MY insurance company, Geico, wouldn't cover me on either one, and the offenders involved didn't have verifiable insurance with any company themselves.  Needless to say I started paying for full coverage soon after, and switched from Geico to AmFam), have never had a health issue that required my health insurance to kick in, my home has never been broken into, and as close as I can figure, I'm still alive, so life insurance, which I've yet to purchase, is a moot point.  I guess I'm just a lucky guy, where insurance is concerned...or maybe not so much.  I'd have to say I don't often describe myself as lucky when calling in my payment to my insurance agent, and never needing to collect compensation for it.

Therefore, folks like myself aren't exactly investing money in...well, ANYTHING.  Oh sure, it's easy for a person to say "Yeah, but SOMETHING might happen, someday!"  Yeah, but what if something NEVER DOES???  What a waste of perfectly good money that I could be spending on something else that I really DO need!  The only real insurance I see as anything close to a wise investment is life insurance...and it's not really life insurance, it's DEATH insurance.  You're not insuring that you're going to keep on living, you're insuring you're going to die someday!  Anyway, this one I get.  This insurance is for the sole purpose of looking after the people who outlive you, to help them bury you, pay your bills off, and is for taking care of your loved ones after you croak.  That makes sense.  After that; and yes, mostly because I have yet to benefit from any of it, it's a waste of  a huge pile of good green money.

I'm sure everyone has experienced these thoughts at one point or another.  I'm guessing I'll get plenty of empathy, here.  If nothing else, it sure explains how I came to this opinion of the Insurance industry.

First, insurance companies shouldn't ever be allowed to drop you as a policy holder; unless you've been with them for less than a year, or for some similar reason, like paying out too much in too short a time, etc.  I suppose what I'm saying is, if you pay for, say 2 years...then let's say you get into an accident, and it's not your fault.  The company you've insured with pays you out, then sends you a letter saying they've decided to drop you, leaving you to find insurance elsewhere.  And when you do find a good company with fair rates, one of the first things they ask you is have you had, as well as where you were insured before, and had you received any benefits for anything you might have incurred during your time with them.  For one, if the company you were with doesn't want you as a client because they had to pay you for your accident, then they shouldn't be in the insurance business to begin with, should they?  Isn't this what it's all about?  Why should they be the ones that decide whether to insure you or not?  Wasn't it you that came to them in the first place, to take a policy with THEM?

Second, you've had your accident...wouldn't it be reasonable to consider you, more or less, pre-disastered now?  You've only had the one accident, some ten years ago or so, on your record prior to that, so aren't the chances you'll have another anytime soon pretty far-fetched??  Besides, they can (and usually do) raise your rates to cover it, if they really feel that way about it, right?  Now, because they dropped you, you have to insurance shop all over again.  There should be guidelines, at the very least, if this practice is going to be allowed to continue.  You know, like if you've been with the company a year or less, or the payout amount when you do have one is over $10,000...or something along those lines.

Here's another little bit I love...the commercials these people run, 25/8.  How they can (all) save you up to $532 a year on your car insurance?  Really?  For one, every one of them says they can do this.  SOMEBODY'S gotta be lying.  It was cute when the gecko said it (the first 10 times or so), and I do still greatly enjoy the better portion of Gieco's commercials, but for cryin' out loud, don't they have it down that WE have it down, by now?  That'd be something worth knowing if it were true in every case.  NOTE:  Funny thing, Geico was the company I had my liability with when I was involved in those accidents they wouldn't cover me for...and my payments to them were more than the American Family Insurance payments I made, under the exact same circumstances, for full coverage.  Not only that, the amounts they'd pay out for coverage were bigger too.  So the originator of the "15 minutes and you could save up to $532" slogan, that basically became the same theme of every insurance company to jump on that train afterwards, was charging me twice as much for their liability as I was paying AmFam for their full coverage.  Go figure.

Most of all, I love it when certain companies stop covering certain things because they start happening a lot.  For example, hurricane insurance in the southern gulf states was a booming industry...then the hurricanes nearly tripled one given year, and the companies that offered that insurance discontinued the insurance entirely.  Surely they knew this might happen, and when they were enjoying the moneys that flowed in when the hurricanes were seldom to none, they had no complaints.  When a company that offers insurance sets up shop and specializes in a particular insurance, it should be made to keep it's doors open for a set amount of time, depending on the type of insurance they offer, to make sure they get the bad with the good, I think.

I guess the point to  all of this is that mandatory insurance, to me, is oh so much, a cruel and unusual punishment endured by the majority of Americans.  We already have several insurances to pay for, most before we come to benefit from them...Unemployment Insurance, Medicaid Insurance, Medical Insurance (unless you work for a large corporation that includes this in your benefit pack)...and Dental Insurance; which all comes out of your paycheck, usually in no small amounts.  And as if that weren't enough, you have your home insurance (or your renter's insurance) and your vehicle insurance to pay, on your own.  Oh, and let's not forget cell phone insurance, electronics insurance, and, quite possibly pet insurance (or deposit, if you rent).  Add that to the unbelievable amount of income tax and social security (one could almost call this "Just in case you're not able to work anymore" insurance) they take out of your check, it doesn't leave a whole lot for living basics, does it?

Now I'll go along with the fact that, on occasion, insurance is, and was, in it's former glory as a new and budding business, a good thing to invest in.  I've seen people get in horrible accidents, for example, that even involved a lot of future pain or even death, where, if you hadn't had insurance, the compensation given to the persons hurt would have broke you beyond your years, and probably would have dipped into  the next two or three generations' wallets as well.  Also, I've seen house or business fires, where the building was burnt to a crisp, or was seen by many floating down the river after a mudslide, where the insurance adjuster became your personal messiah with little stretch to the imagination.  In these cases and those like it, I'm sure our citizens were more than thrilled to have paid all of the money they did for their policy.  Yet, for the majority of us, insurance is a deadly sin, a black hole that sucks your wallets and your banking accounts dry.

The wealth of money these companies gouge from us is as obvious as driving through our cities' downtown streets.  Nationwide, for example, takes up nearly 4 blocks of our downtown area, with all new buildings and enough employees to fill a town half our size.  I feel new regulations and rules should be implemented where insurance is concerned, along these lines:

1.  No client drops, depending, of course, on the number or the size of payouts to you, or the length of time you've been a client, when a big payout is made.
2.  The ability of clients to recoup part or all of the payments made into the policy when no reason whatsoever, covered by the policy in question, occurs.  If you pay fire insurance for 30 years, and no fire ever occurs in that time, for example, maybe fifty percent of the policy should be refunded to that customer.  A lot of the insurance companies we invest with nowadays have been around for a good number of years, so it's not implausible.  If an insurance company can't handle covering those kinds of refunds, then they shouldn't be allowed to start that sort of business to begin with.

With these sort of regulations in place, maybe then we wouldn't feel like we're being ripped off on a daily basis when paying between 3-5 insurance premiums a month or per paycheck, hmmm?

Day nine has come and gone.  17 more to go.  :D