Reader Question: The Mafia

Here’s the latest reader question, along with my reply!

Erik asks: I have read about a half a dozen of your posts regarding the insurance mafia. Agreed. But which mafioso bag man (insurance company) do you think might be maintaining appearances of respectability better than the rest? Which one do you think is least crappy to deal with?

To use your example of the mafia, there can be big differences when dealing with organized crime- in that depending upon which person you have to deal with can easily result in some pretty different outcomes.Heard you yesterday on the David Knight show; appreciate your comments as always. Peace.

My answer: The big problem with insurance is you’re forced to pay them – but you can’t force them to pay you.

Assume they won’t.

The only real power you’ve got is to shop for the lowest cost coverage-at-gunpoint you can find and avoid ever filing a claim. In particular, do not file a claim for things like cracked windshields and minor damage you can pay for out of pocket – because if you do file a claim, it’s very likely you’ll end up even more out of pocket, in the form of higher insurance premiums.

All the “families” are notorious for this.

Keep in mind, they are not just a mafia – they are a cartel. They are nominally independent, but feed from the same captive audience and use the same government resources (e.g., your DMV history) to dun you at approximately the same rate.

So, try to save as much money on “coverage” as you possibly can – and save it up for a rainy day. If that day never comes, you’ll have a nice little slush fund for things other than “coverage.”

. . .