« The new home page | Main | $100 incentive to get a Chase card »
June 12, 2005
Insurance on my cell phone? Are you crazy??
I always thought insurance is to help cover losses that would wreak havoc on someone's finances if they didn't have insurance. For example, auto insurance, home insurance, and sometimes life insurance all make sense to me. If things go disastrously wrong, you need some back-up.
The expectation for all insurance is that you're going to lose money. That is, the insurance companies have figured out how often people's homes burn down or someone slips in the driveway trying to carry in a 50 lb box of Cheerios from Costco, for example, and how much they have to pay, and then make sure they charge you enough in home owner's insurance to make a profit. That means you don't expect to collect more in insurance than premiums.
So why would I want cell phone insurance? I just got a $100 cell phone and when I called to activate it the CSR "HIGHLY RECOMMENDED" insurance ... on something that costs $100!! Again, you don't expect to collect more than the money you pay out for the insurance. What a scam this is. Of course people go for it - I would love to know how much money the cell phone companies make from this stuff.
Anyway, here's a nice list of other horrible types of insurance.
Posted by brian at June 12, 2005 07:08 PM