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Want to be an actuary? Odds are, you’ll fail the test

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Re: Want to be an actuary? Odds are, you’ll fail the test

#121

Post by derbOac »

poulsbohemian wrote: post #113
d136o wrote: post #39

In this [1] interview by Barry Ritholtz, Markel CEO essentially told the origin story of an insurance giant. Basically a family member was a lawmaker, passed a law that drivers of the newly invented cars (maybe horse buggies?) must be insured. They simultaneously started a company that sold insurance. Over time they learned to make money from investing their customers capital. It blew my mind at how candid he was abo…

>Title insurance when buying a house also seemed like a total “legally required” joke. Real estate agent checking in here... I agree with you, but there's always a but... the problem is that there really are situations where there's a cloud on title or where title is questionable. This doesn't mean there's anything nefarious going on, and it also often isn't a question of history (IE: title recorded on parchment or s…

Not to sound snarky, but this was my reaction as well. It's also the very nature of insurance: you get insurance to cover the rare but costly problems that arise. If they're not rare, you don't need insurance because you address the problems another way.

Re: Want to be an actuary? Odds are, you’ll fail the test

#122

Post by dragonwriter »

gizmo686 wrote: post #112
dragonwriter wrote: post #100

Earlier quoted context omitted.

> The 'scam' seems to be insofar as wealthy and powerful entities can exploit the functional inability of those less wealthy and powerful to meet them on even terms in the legal system. Even without insurance or greater wealth, a party from whom you believe a liability should exist who has no interest in paying could have done the same thing here. If you aren't willing to sue over a disputed liability, it might as we…

> Any proposal to do that in effect makes the police investigation a court of first instance, which either means creating additional procedural rights that apply before it can be completed (driving up costs) or a very real denial of due process. Not nessasarily. The 'additional weight' could still be something that requires a suit to take advantage of directly, but which the threat of compels behavior. For example, m…

What you propose is additional weight that does require going to court, basically additional incentive to settle if it is reasonably perceived the other party will take the case to court.

But there are already additional costs the insurance company would bear if it went to court, which is why they will mostly settle if there is any substantial evidence (like a police report) and even a shadow of a threat of legal action, including—but not limited to—an insurance company on the other side. Neither that nor any additional weight you give the police report that requires going to court alters the calculus at all when the liable party (whether or not they have an insurance company as their agent) is certain you won't take that step.

Re: Want to be an actuary? Odds are, you’ll fail the test

#123

Post by extr »

peregren wrote: post #83
extr wrote: post #71

Earlier quoted context omitted.

It sounds like you were just cheap, didn't want to purchase comprehensive coverage, then that came back to bite you. This sucks, but is hardly a scam. Even worse, it sounds like you even understood what comprehensive coverage does (cover 1st party physical damage regardless of situation), and consciously chose not to buy it, assuming that anything that would possibly happen to the vehicle would be someone else's faul…

If the other party is 100% at fault, why should they not pay for the damage they caused? And its not “cheap” to not get comprehensive insurance. Its a calculated risk.

It does suck that in OP's case they caught the wrong end of this. But again, that's why you carry your own insurance with your own coverage. You're not just paying for the literal indemnification of auto damages, you're paying for the cost of litigating and proving facts in court in various hypothetical scenarios. As the other poster said, cops don't determine fault. You have to go court for that.

As somewhat of an aside, since I think a lot of people don't realize this: Most of the time attempting to allocate blame in auto accidents is a massive waste of resources and time. Insurance companies usually just settle with each other before even getting to court unless the claim involves big $. Even if you were 0% at fault, your insurance company is still incurring some cost to process the claim. Their assessment of your risk is still going up (as it should). They're still going to up your premium. The whole fault concept is just not helpful to the actual functioning of the industry, most of the time. In some states they just got rid of fault altogether, for exactly this reason.

> And its not “cheap” to not get comprehensive insurance. Its a calculated risk.

Yeah, a risk that in this case, did not pay off. So why is this guy whining all over this thread that he got "scammed" when he knew it was a risk?

Re: Want to be an actuary? Odds are, you’ll fail the test

#124

Post by explodingman »

gizmo686 wrote: post #68
romwell wrote: post #57

Earlier quoted context omitted.

Side story about how satisfied people can be with the mandated insurance. I was on coast-to-coast road trip when I got into an accident in TX. Someone was trying to pass me on the left in a turning lane, veered into the incoming lane, and then hit my vehicle's front wheels from the back. The police ticketed the other driver, and told me that insurance will surely take care of that on my side. "Wow, it's worse than we…

Whats the scam? The insurance company was hired to provide insurance for the other driver. By all accounts they did so. If the other driver had no insurance, your options would have been the same: hope they pay out of good will, or sue them. The public policy motivation for liability insurance is to protect the lawsuit route. If you sue an uninsured driver and win, you might not be able to collect (getting blood from…

> The public policy motivation for liability insurance is to protect the lawsuit route.

A friend of mine had the same experience from the other side. She ran into some guy's car, apologised for her mistake and told him not to worry because she was fully covered. The first sign that something wasn't right was when a summons to appear at the magistrate's court appeared in the letter box.

She asked the insurance company what was going on and they said "just send the paper work to us and don't worry, we'll take care of it".

Then she got a knock on the door from a pair of court-appointed officers who were there to discuss her financial situation and assist her in arranging a payment plan to pay off her fine. Her insurance company had not sent a representative to the trial, so the magistrate found in favour of the only party that had turned up.

After some screaming on the phone, the insurance company paid the full amount of the judgement.

Any judge worth his salt will understand the global implications (courts clogged with litigants, inability of poor people to use cars) if insurance companies stonewall when their client is at fault, whatever the odd lot who comment in HN think. The judge should hit the other party.

Bear in mind that this is a matter of public interest and romwell has not signed an NDA. S/He should name that insurance company!

Re: Want to be an actuary? Odds are, you’ll fail the test

#125

Post by poulsbohemian »

derbOac wrote: post #121
poulsbohemian wrote: post #113

Earlier quoted context omitted.

>Title insurance when buying a house also seemed like a total “legally required” joke. Real estate agent checking in here... I agree with you, but there's always a but... the problem is that there really are situations where there's a cloud on title or where title is questionable. This doesn't mean there's anything nefarious going on, and it also often isn't a question of history (IE: title recorded on parchment or s…

Not to sound snarky, but this was my reaction as well. It's also the very nature of insurance: you get insurance to cover the rare but costly problems that arise. If they're not rare, you don't need insurance because you address the problems another way.

Yeah, that's exactly it. I know I've certainly spent spare brain cycles considering it, and there seem to be a number of startups trying to create cheaper title insurance, but it's not clear to me how to really solve the issue. Basically it's a human behavior and record keeping problem. You have to have perfect records, and you hope some estranged cousin doesn't magically popup with a deed someday claiming to own your house. So, you fork over $1000 just in case.

I'm actually in a transaction right now where the title history is weird and questionable. Will the insurance be a factor? Probably not, ironically, but it's exactly the kind of scenario for which this kind of thing exists.

Re: Want to be an actuary? Odds are, you’ll fail the test

#126

Post by lordnacho »

dragonwriter wrote: post #100
AQuantized wrote: post #79

Earlier quoted context omitted.

The 'scam' seems to be insofar as wealthy and powerful entities can exploit the functional inability of those less wealthy and powerful to meet them on even terms in the legal system. I think we could all agree that in an ideal world if someone is at fault, their insurance should pay out to those they damaged. The reality is that may only happen if you have an entity of similar magnitude to go to bat for you. That do…

> The 'scam' seems to be insofar as wealthy and powerful entities can exploit the functional inability of those less wealthy and powerful to meet them on even terms in the legal system. Even without insurance or greater wealth, a party from whom you believe a liability should exist who has no interest in paying could have done the same thing here. If you aren't willing to sue over a disputed liability, it might as we…

That doesn't seem reasonable. Whoever is liable should pay, there shouldn't be a little game where you can avoid paying because it will cost the other guy too much.

Imagine if murder cases were only prosecuted if the family had funds to investigate, and they only got refunded if the murder were proven.

Re: Want to be an actuary? Odds are, you’ll fail the test

#127

Post by dragonwriter »

explodingman wrote: post #124
gizmo686 wrote: post #68

Earlier quoted context omitted.

Whats the scam? The insurance company was hired to provide insurance for the other driver. By all accounts they did so. If the other driver had no insurance, your options would have been the same: hope they pay out of good will, or sue them. The public policy motivation for liability insurance is to protect the lawsuit route. If you sue an uninsured driver and win, you might not be able to collect (getting blood from…

> The public policy motivation for liability insurance is to protect the lawsuit route. A friend of mine had the same experience from the other side. She ran into some guy's car, apologised for her mistake and told him not to worry because she was fully covered. The first sign that something wasn't right was when a summons to appear at the magistrate's court appeared in the letter box. She asked the insurance company…

> The judge should hit the other party.

What judge?

The whole scenario is around a party who was not willing to go to court. There's no judge involved.

Re: Want to be an actuary? Odds are, you’ll fail the test

#129

Post by tfehring »

Aloha wrote: post #86
tfehring wrote: post #66

Earlier quoted context omitted.

Disclosure: used to be an actuary at an insurance company. I think the general rule is that your insurance will reliably cover the things that it explicitly says it covers, but that category may be narrower than you think, so you should read the policy and figure out what your policy does and does not cover. For example, if you go to a doctor who's not in your health insurer's network, you're probably not covered. In…

I'd love to know more about Texas County Mutuals! I find this stuff fascinating!

It's a legacy category of company that gets favorable regulatory treatment (mostly in the form of more flexible pricing) for auto insurance policies written in the state of Texas. It's been illegal to form a new Texas county mutual since 1955, but the ~20 that have remained in existence since that time are still grandfathered in. Some of them have been acquired by big national insurers (e.g., GEICO fully owns one and has a controlling interest in at least one other), which issue policies on the county mutuals' paper and then cede (transfer) the business back to the parent company. Other county mutuals effectively license their favorable regulatory treatment to other, unaffiliated insurance companies. A significant minority of the auto insurance policies issued in Texas today are still issued on county mutuals' paper.

Re: Want to be an actuary? Odds are, you’ll fail the test

#130

Post by dragonwriter »

lordnacho wrote: post #126
dragonwriter wrote: post #100

Earlier quoted context omitted.

> The 'scam' seems to be insofar as wealthy and powerful entities can exploit the functional inability of those less wealthy and powerful to meet them on even terms in the legal system. Even without insurance or greater wealth, a party from whom you believe a liability should exist who has no interest in paying could have done the same thing here. If you aren't willing to sue over a disputed liability, it might as we…

That doesn't seem reasonable. Whoever is liable should pay, there shouldn't be a little game where you can avoid paying because it will cost the other guy too much. Imagine if murder cases were only prosecuted if the family had funds to investigate, and they only got refunded if the murder were proven.

> Imagine if murder cases were only prosecuted if the family had funds to investigate, and they only got refunded if the murder were proven.

Vehicular crimes obviously don't depend on either a victim or the victim choosing to take legal action for the offense, OTOH, wrongful death, the civil cause of action parallel to murder and other criminal homicide offenses...has exactly the same requirement as any other tort that someone has to file suit.

To the extent there is a criminal or other public offense (traffic infractions may or may not be strictly criminal depending on state law) involved in the accident, that would have been pursued without the victim lifting a finger as a consequence of the police report, just like murder investigations.

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