In Reply to: The analogy is 100% valid IMHO... posted by SL on January 14, 2000 at 08:18:16:
I guess my perception of the importance of this type of insurance is different than yours then. My wife doesn't nearly make the amount of money I do, and if I were to exit this earth earlier than expected she would not be able to handle our monthly expenses. We are ones who DO have term life for that reason.
Maybe when we are a little older and have more of a "nest egg", term life will not be as important, but I doubt it.
So we do not feel this type of insurance is a gamble in the same sense you seem to feel. We feel it is one of life's necessary security blankets (term life, not extended warranties on cars).
Anyway, and again, I certainly understand your point of view as well.
: Any time you buy an insurance policy you are placing a bet. As macabre as it sounds, a term life policy simply means you're betting you will die before the period covered by the premium expires, and the insuror bets a much larger sum on very favorable odds that you won't. Never mind that you sure hope to lose that bet!
: An extended warranty is nothing in the world but an insurance policy bought to cover car repairs. However, IF you are in a position to self-insure for car repairs instead (not everybody is) the alternative proposed at the beginning of this thread is a good idea that has better overall odds of coming out in the car owner's favor.