Friday, July 14, 2017

Soon You'll Bill Insurance for Your Gas and Electricity

As if it weren't bad enough we're billing insurance for routine doctor visits and prescription drugs, today I saw TV ads for Car Shield and Home Warranty of America.

These outfits offer to cover minor auto and home repairs, respectively, not covered by actual auto or homeowners' insurance. It's not only a bad deal for the customers, who inevitably end up paying more for the coverage than they would pay out of pocket for whatever repairs they may actually need, but as the evolution of medical coverage has played out, it will be a bad deal for everyone else as the rise of third-party payer programs for these kinds of repairs makes costs go up.

And when costs go up, more and more people will buy these kinds of policies, and the momentum for higher costs will increase.

And then? Single-payer.

You think I sound like a crank.

You should know better than that.


  1. This is the successor to the annoyingly popular Extended Warranties for cars, usually justified as follows:

    "Well, I don't want to get hit with a $3000 repair bill."

    How much does this coverage cost?

    "$150 a month."

    For how long?

    "Thirty-six months, same as the car note."

    You're spending $5400 to avoid a bill for three grand?


  2. The quick-witted in that instance might mutter something about the time-value of money, but even it seems inapt to these ongoing coverages.