Originally Posted by Kenny Maclean:
“Not necessarily. Having not lost a phone in over 2 years (24x6.99=168), earlier this year, I lost, then had my desire stolen, so have made 2 claims for a £300 handset within in a few months. Insurance paid out, but even one claim would not have covered a replacement.”
Ok you carry on paying £7 for the rest of your life then (over £4,000) just to replace maybe 3 or 4 phones, which is probably the average of phones people lose or have stolen in a lifetime. The insurance company will make more than 50% profit, unless as I said you are much more accident prone than the average person, in which case you'd want to have insurance.
How do you think insurance companies make money? they make it because on relatively small replaceable items like this where it's optional people pay them twice as much as they claim back on average.
By not insuring things that you could afford to replace out of your own money you are paying that necessary, it's basic logic.
The only exceptions are 1) if you can't afford to replace it and money it very tight, but the item is absolutely essential 2) if you are much more accident prone than the average person.
I'm my own insurance company when it comes to fairly replaceable items, it also makes you a bit more careful with your items too. Haven't made a claim on 'Thine Wonk's mobile phone insurance' now for 10 years, net result = £840 in profit, could replace 2 phones now in the unlikely event that I needed to.
Also the 'payout' money if you consider depreciation and the fact that you might have been going to upgrade or buy a new one at some point soon can all come into it.