> You'll also lose money paying for insurance.
Only if you put zero value on the peace of mind that comes with having insurance against risks that, if they happened, would bankrupt you. But if you put zero value on that, you wouldn't buy insurance.
Only if you put zero value on the peace of mind that comes with having insurance against risks that, if they happened, would bankrupt you. But if you put zero value on that, you wouldn't buy insurance.
Only a fraction of the consumers come out ahead if we only consider monetary value. But the whole reason insurance and the lottery exist in the first place is that there are other kinds of value besides monetary value. In the case of insurance, it's peace of mind. In the case of the lottery, it's whatever entertainment value comes from being able to visualize yourself winning, even if your chances of actually doing so are tiny.
Only if you put zero value into seeing your savings go up with the amount you saved on insurance.