Real life

Confessions of an insurance junkie

It’s hooey but I was a sucker for the promise of safety and security —until I added up the premiums

21 February 2015

9:00 AM

21 February 2015

9:00 AM

Never add up your insurance premiums. I just did and the annual cost of all of them came to more than the cost of most man-made or natural disasters. That means there really isn’t any point to any of them, statistically speaking.

The problem is I’m an insurance junkie. I’m a born cynic, a pessimist, a worrier. Someone only has to ask if I have ever thought what would happen if… (insert improbable but horrendous mishap: the dog ingesting a rare kind of lungworm, Russian separatists misfiring a rocket at eastern Ukraine that lands on my roof) …and I’m ready to sign on the dotted line of any kind of lunacy. I’m a sucker for the promise of safety, security ‘and the peace of mind of knowing that in an emergency you and your loved ones…’

Of course, it’s hooey. The small print clearly states: ‘In the event of you and your loved ones actually needing any of the help outlined in this policy, Royal Sod You Alliance reserves the right to deny all liability because you’ve got the wrong kind of window locks. Ha! Didn’t read that bit earlier, did ya?’

I once took out a very strange policy insuring my keys after my credit card company informed me I was dangerously uncovered for losing my handbag while on holiday and/or not being able to get my locks changed in a hurry if I was burgled.

After years of paying for this particular piece of peace of mind, I had my bag snatched and rang the helpline. ‘Oh no. You would have to call the locksmith yourself and then apply to us to reimburse you. We often do, once we have reviewed all the evidence, although it does take six months. And we don’t pay out unless you can prove you lost the keys during a full moon. You did lose the keys during a full moon, didn’t you? Would you like the forms sent out? They’re only 17 pages long.’

I know all this and yet still I fall for it. But what chance does a neurotic like me have of saying no when a salesman tells me that, unless I pay him an extra £11 a month on top of whatever I have paid for the appliance he has just sold me, said item will inevitably break down and in the ensuing fallout I will end up on the streets, destitute and alone.

Also, did you know that insurances breed? They do. They multiply and mutate. My boiler insurance was just boiler insurance until British Gas pointed out that it might not be my boiler that stopped working, it might be my radiators, or my pipes or my drains ..or my electrics. ‘Jumping Jehoshaphat! Insure every pipe and wire in my house, in the name of all that is holy, and never mind about the cost,’ I begged. And they didn’t mind.

Obviously, however, I can’t ever actually claim on any of these insurances, because that would put the premiums up. I once claimed on my horse insurance for an injury to one tendon in one leg, and Gracie ended up with none of her legs insured because, as the company argued, she might be compensating by standing on the other three legs too much now.

You can’t claim on them, but you can’t cancel them. Gracie is insured only from the haunches upwards, but I kept that policy going on the basis of them pointing out that cancelling it would leave her digestive system dangerously exposed.

Obviously, I never use my own health insurance. Not unless I have a minor complaint with no ongoing implications for my wellbeing. Lying in the bath recently, I noticed my big toe was getting kind of lumpy. ‘Oo, goody!’ I thought. ‘I might be able to have a luxurious stay in a private hospital and get a bunion removed without totally invalidating my cover!’

But the insurance I resent most is my laptop insurance. This is because I didn’t know I had it until I got a letter the other day informing me they had made a mistake and not taken the latest payment. So I rang them and asked what it was this policy did and they said, ‘Which policy are you talking about, madam?’

‘You mean I have more than one policy with you?’ Turns out I have laptop insurance, and cover for a cranky old Hewlett Packard desktop I never switch on, and a third policy that has entitled me for the past six years to ring a helpline I didn’t know was there.

Foolishly, I added up the total cost of these premiums for the period I have been paying them and it came to enough to buy several new computers.

Still, you can’t put a price on retrospective peace of mind.

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Show comments
  • Flintshire Ian

    There is a lot of truth in this article. I had a bike insurance policy (sold with the bike) that I finally cancelled when I realised that making a successful claim for theft was probably impossible unless someone physically threw me off it to steal the bike and there were witnesses.
    If you try hard enough, it is possible to get out of Currys / PC World et al without buying product insurance cover but the staff don’t like it and will get their revenge by not providing a VAT receipt and other little pleasantries.
    Most technology is now so cheap that if it fails once it is out of the manufacturer’s own warranty you might as well buy a brand new latest spec version with a good chunk of the cost coming from not buying the extended warranty on the failed product.

  • davidofkent

    Insurance is for events which would cause you serious financial loss, such as a house fire. It is not for ‘things which happen in life’. A lot of bonuses are earned on the basis of insurance foisted onto the gullible.

    • Ed  

      Every credit card statment I receive has the ominous statement “This account is not protected with XYZ Bank Balance Protection Coverage. If you wish add protection, call….”

      But since I always pay my balance, I’m fine with that.

  • Men control the media

    Insure nothing and don’t live your life taking precautions against assaults and terrorist attacks that are very unlikely to happen. Sod the victim blamers and health and safety tyrants, they’re interested in making their lives better, not yours.

  • polistra24

    Nice article. I got into that ‘insure everything’ mode at one point in my life. Finally understood that it’s better to be your own actuary. Estimate how often this event is likely to happen, given your own situation and habits. Estimate how much it will cost. If you can absorb the cost at the likely intervals, don’t insure.

    But if the event could involve a lawsuit against you, ABSOLUTELY get insurance.

  • Retired Nurse

    Health insurance in Holland (the system we’re importing here) is awful – now all the Insurance companies have formed themselves into a cartel (as they always do), they keep changing what you’re insured for – you’ll only discover you’re not covered when your children are in A&E with their entrails hanging out. Assisted suicide of course remains absolutely free with all policies, as it saves the State and their commercial partners the cost of any further medical treatment, plus your care costs and pension..Maybe they should simply bundle that in with gas boiler cover and home start car insurance and save us the bother of having to deal with insurance reps?

    • Ed  

      In Canada we just had a court case legalizing assisted suicide. I expect next week the pressure will start for the health system to extend this “help” to the expensive people.

  • Three chords & the truth

    Had unsolicited quote for Medical Insurance.Premium £147 per month! Do they know something I don’t?

  • Contractors always sell themselves as being licensed, bonded, and insured. (I’m still not sure what the bondage thing is about, probably because I’m so innocent.) But it does you no good, whatever they’ve got. I hired a painter to paint most of my house which had just been recovered with a spectacular — and I do mean gorgeous — wide-plank maple genuine wood floor. It cost us 20 grand (USD). He pulled the fridge out to paint behind it (where no one will ever see the paint), even though we’d been tiptoeing around the whole place to avoid scratching the floor. He didn’t ask me about moving the fridge or whether I had a masonite board for such a procedure. Nossir! He just went ahead and did it (I was lying down for five minutes because he talked NONSTOP about his wannabe writing career; I was about ready to take arsenic by that point). The gouges and long scrapes along my brand new very expensive pristine wood floor were extensive and undeniable. But guess what? His insurer said that this damage was not covered by their policy. And it stands to reason. The painter didn’t want us to be rewarded: his premiums would go up, and he could no longer claim that ‘no one has ever made a claim on my insurance’. The insurer didn’t want to acknowledge the damage: they’d have to pay out. As far as we’re concerned, the insurance company and the painter are in it together, for their own purposes. We got stiffed. THAT’S how much — or how little — insurance is worth to the homeowner hiring services.

    P. S. I paid the painter the full amount anyway as part of a deal whereby he would cooperate by providing the insurance details. All this meant was that he got his money, I still had a damaged floor, and he escaped any kind of penalty for his stupidity. Fortunately his fee was not large as I drive a good bargain : )