Insurance

Seems to me that insurance companies and casinos are profitable for the same reasons. They differ, though, in that it is at least possible to walk out of a gambling house with a net gain. :wink:

I’m yet to meet somebody who has recovered the total value of their premiums through bona fide claims. But I’m sure it must happen, occasionally.

Somewhere there must be a peaceful-sleep balance between worrying about risk and agonising over premiums. :’(

Rigil

I know some people who own insurance companies and people who work for them. Both tell me the profits are staggering. Or to be exact, the owner guys don’t have to tell me, I can see it by how they live.

Life insurance is particularly profitable, since you basically collect a share of people’s incomes all their lives and if they reach an expiry date you get to keep it all. Or if you’re feeling particularly generous you give them back a paltry token of what they put in, keeping all the interest and the rest for yourself. Plus “fees”.

It’s a devillishly shrewd business this, because I can’t imagine NOT having any of the above either. I guess if you somehow manage to become a billionaire such things would become a bit redundant. Then again, I guess even that guy cries if his R100m yacht burns to the ground.

Sometimes you could actually live without replacing that thing that breaks, maybe you could even save up enough money to make it possible to replace 99% of your stuff. But even then you’re faced with “3rd party” claims which could be devastating. Like bursting a tyre on the highway and wrecking someone’s McLaren. Don’t think I’ll let 3rd party go anytime soon, even if I somehow managed to get myself into the right position to cover my own losses.

My solution to the whole conundrum is not to have any dependants, and not to own much to begin with. Property isn’t theft, as the socialists claim. It’s a burden.

I can fairly easily replace everything I own without needing insurance.

Insurance is an outrageous rip-off. I had ONE claim in 10 years on my car insurance (horse kicked a dent in it), and now they want premiums of over R600 p.m. on a 6 year-old Ford Fiesta. My current beloved, who has written off every vehicle she has ever owned, is quoted 2/3 rds of that BECAUSE SHE IS A WOMAN! I showed them the finger and save the R600 per month. If I write off some poor stiff’s McClaren, I’ll don a false beard and leave town.

It’s simple: All insurance is business, not charity, however much they strive to gull you with that idea. The primary goal of any business is to maximise making bucks for its owners and shareholders, no other reason. If they didn’t make money from it, they wouldn’t be doing it for long. Caveat emptor. Insurance preys on your natural fears: The incidence of X is Y in a million — but what if you’re a Y!?

Too much horsepower, it seems. Should I ask? :wink:

Honesty compels me to admit that we women aren’t inherently less accident-prone drivers than men. That is a convenient myth fabricated and spin-doctored by insurance companies’ marketing machines. I have seen the stats firsthand. In fact, women have more accidents on average. The gender difference is twofold: first, women’s accidents are on the whole much less severe than men’s meaning lower average repair costs per accident, and second, women are more reluctant to claim for minor vehicle damage, giving the impression of lower accident rates.

'Luthon64

we wuz struck by lighting a couple of months ago after writing a short term insurance policy about two months before that. Damages were paid out R45K…100% of claim less the excesses. Not too bad but then we may now have to pay for 10 years before another claim is made…that’s how it works.

I dutifully paid my premiums on a business owner policy. I then got attacked and spend some time in hospital and could not manage my business. Come claiming time they found a “technicality” and refused to pay. Took the case to the ombudsman, but here it is just another inefficient mess. 8 Years and still waiting to hear from them. I think you can classify me as not friendly towards insurance brokers or their industry. >:(

This is a subject that can get me to throw a hissy fit of note. I just told Santam to go take a hike because they increased my premium with R340 odd rand - I’ve been with them 7 months. When phoning to enquire, they suggested I lower the values of my vehicles instead of them reducing the increase.

So I moved again… and got a R300 lower premium. Its a money making business from beginning to end.

My biggest claim(s) to date was back in 2007, where in one day (13th Feb - go figure), lightning hit my house, blasted a hole through the roof, connected with the wiring and proceeded to blow out every single appliance, light fitting and switch right through, that morning I crashed my bike on the track and that night they broke into my car and ripped out the radio… it comes in three they say - this little episode cost the insurance company onto R136 000. Once in a lifetime though.

I need insurance, the risk of not having at this point of my life is just too great.

St0nes - my hubbys Fiesta (also 6 years old) costs us just under R400 per month…

With you there. And comparatively inexpensive.

and

Ain’t this is exactly the kind of stories the brokers tell you …

… and very few of these.

Rigil

My car insurance is only R 173 (Santam), but it’s seven years old and I have a no claim bonus for at least ten years.

If you think the owners of insurance companies make lots of money, you can of course partake in those profits by becoming a co-owner yourself through buying their shares. Several of the larger insurers are listed on the JSE. I bought my first shares while in Standard 7.

Insurance companies prosper because they offer a service. People buy insurance to minimize their exposure to risk. Nothing wrong with that and nobody is forced to buy insurance. (This may change if govt gets its way with health insurance) It’s up to the consumer to assess the quality of service offered and as we have seen in the past, companies do actually fold due to poor management or an inability to provide a decent product or service. Many large companies self-insure and even individuals can consider this if they have the wherewithall to create sufficient reserves. Large Insurance companies such as Sanlam and Old Mutual are in effect owned by the policy owners and shareholders who share in the profits as Hermes has indicated. I assessed investment in life policies and found them non-remunerative and rather invested in other instruments where I had more control, such as shares, property and business investment (this is obviously more risky). I also bought some annuities that are now matured and invested in the stock market via unit trusts giving returns well above fixed deposits interest rates etc. At the end of the day one must take decisions and live with the consequences.