Why Golfers Buy Hole In One Insurance
priceonomics.com
priceonomics.com
If it's a larger event, the purse for winning easily covers the hole-in-one celebrations. On top of this, if you are a member of a local country club - you're already paying hundreds if not thousands a month on membership dues. You're expected to have such wealth that to cover drinks/food isn't a big deal. Some clubs are structured such that you aren't directly paying for the celebrations, but your membership dues are such that it includes the cost of any potential celebrations.
Golfing is a game for the wealthy, including the traditions surrounding it.
Source: Caddyshack
A hole in one is only 2 (or extremely rarely 3) under par, the spread of scores in a game would usually be far greater than that.
I think the article DOES hint at explaining it anthropologically -- there's a rich tradition of "potlatch" events in which community members demonstrate their power by how much they can give away. Ultimately, you've just experienced some incredible good luck, and that gets spread around by handing out free drinks. Also, if you hang out at the club long enough, you'll be the recipient of many hole-in-one free drinks, which will ultimately balance out the round you had to buy.
Funny story - when I got the hole in one, my foursome spent 5 minutes or so looking behind the green for my ball before someone looked in the cup and asked, incredulously, if I was playing a Titleist.
Anecdata: As one of the most erratic, temperamental and limited golfers ever in my teens, I once nailed an approach shot from 150 yards straight into the hole on the second hole (arguably, given that I was playing my second shot from heavy rough, a more difficult shot than a hole-in-one on a regular par three). In the same round I then managed to lose five balls in the process of scoring seventeen on the 17th during the same round. To be fair, it was quite a difficult 17th. Strangely, I haven't played much since.
Not all golfing takes place at country clubs. The District of Columbia has four public courses (three of them nine-hole). I golfed when I was a kid, and though we were comfortably off, it would be a stretch to say that we were wealthy. I've since known golfers who, again, were comfortably off and not much more.
Do those golfers put wagers on their rounds? I have no idea; we never did.
Tell that to my $20 set of clubs and $5 bucket of range balls.
I very rarely bet any money on my round, nor do the people I play with. True, there are people betting on their rounds, but I'd estimate it's 1 out of every 10 groups that goes out for a round that does that.
The article blows it out of proportion a little bit, too. At the courses I play (in the bay area), there are usually maybe 20 people in the clubhouse, and a round of drinks would probably come to $100. The "insurance" crowd is a very small subset of the golfing population.
True - it is an expensive sport and maybe traditionally a game for the wealthy, but my weekly golf habit doesn't cost much more than a gym membership. People from all walks of life play and enjoy the game, and it definitely doesn't have to be expensive unless you want it to be.
For instance my local club ( http://www.akaranagolf.co.nz/akarana_join.php in the middle of Auckland ) charges $1875/year ( $NZ but close enough to $US) for a full member while the club I used to play at ( http://taierigolf.co.nz/?page_id=49#membership a bit out of a smaller city ) charges $650/year. You could play all year for just that amount.
I just asked my relatives what the rule is at their club (which is fairly nice/expensive as clubs go) and they said "In the old days the club would shout the bar, at our club new the club pays $150 and you pay the rest. So normally people wait till few have left before buying". So just a single round of drinks. I've found similar bits in the rules of other clubs
And that this is common enough that there's an insurance product to hedge that miniscule risk?
It seems like a much shorter article could have been written: Because they can't do math.
Even if the $3 premium really is a one off fee which covers $3000 worth of celebratory cruises (both of which I doubt), an amateur golfer with a 1 in 12,500 chance of getting a hole in one and enough disposable income to join the sort of golf club that expects celebratory cruises probably shouldn't bother.
Let's see: you just paid $3 to hedge a risk with less than a nickel's worth of -EV and you're holding your daily Starbucks. I'm beginning to understand why you can't afford the risk...
Yes, yes. I know I'd be erecting a strawman if the coffee was central to my argument. I don't think it is; I'm just trying to share my mental frame.
I have liability-only car insurance (and high limits at that) but not collision/comprehensive, as I can readily write a check for a replacement car. (My car is worth about $5K; my wife's car about $7K.)
I have home insurance as I'm required by my mortgage to have it, but also because losing the house would be lifestyle-changing.
I don't insure risks that wouldn't be lifestyle-changing (unless legally mandated). I'd wager that $650 for a round of drinks isn't lifestyle changing for most golfers.
This insurance makes extended warranty plans for electronics a positively great deal in comparison...
One would hope then that upon getting a hole in one they would not spend $500 that they cannot afford. It's not a requirement to buy anyone else a drink.
I have heard of this "tradition", but after travelling week to week with the PGA tour for years and playing golf with a multitude of new people every week, and have never even heard of someone buying more than three drinks for their playing partners.
Say that the difference between winning and losing a final is £50k, and the bookmakers pay out even on a bet that you lose. If you bet £20k on you losing, you change a "nothing if I lose, £50k if I win" game into a "£20k if I lose, £30k if I win" game.
Some players prefer such a game. Placing that bet might even increase their chance of winning, as part of the stress gets removed from the game (you're playing for £10k, not for £50k)
On a related note, a friend who's a sports better always placed the biggest bets against his own teams. Partly because he trusts his judgement better when not clouded by the hope that his team will win, partly because if he looses the bet, hey, his favorite team just won the game against the odds!
There was just someone ranting on Twitter yesterday about Bill O'Reilly's ranting of how few millennials actually play golf - "Why Is The Generation We Sunk Into Crushing Unemployment and Debt Not Playing Our Shitty, Classist Sport?"