Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The Applecare Hustle

basicappleguy.com

Post reply on HN
Print view View original

11–20 of 107 posts

Re: The Applecare Hustle

#11

Post by lobochrome »

I remember a course on game theory at business school where we proved all insurance to be non-optimal. There were two ways to deal with catastrophic risk if I recall correctly, depending on the gain function:

a) if catastrophic risk is infinite - no premium will be acceptable due to price.

b) if catastrophic risk is discrete - it is optimal not to insure since the expected loss is ruinous anyways.

Led me to be highly skeptical of all insurance ever since. Paying out of pocket previously felt scary - now it feels good since I know I am saving money with acceptable risk.

Of course - I am more than happy to have mandatory insurance for healthcare, liability, etc. since I am not living in the US.

Going back to my game theory text books now :)

Re: The Applecare Hustle

#13

Post by pbourke »

My last phone was replaced once and my current one has been replaced twice, both under AppleCare. I view AC as “phone as a service”, which is reasonable. The recent option to add accidental drop and theft coverage onto the base AppleCare seems to be making that explicit. I’d like to always have a phone and have it be replaced quickly if it goes kaput.

Re: The Applecare Hustle

#14

Post by kennywinker »

ssivark wrote: post #4

1. Is this much repair indicative of abnormal use, or are Apple products not really robustly designed? 2. Why are repairs so damn expensive? Several hundred dollars each to repair a scratched screen or replace a torn earcup fabric!?!?!?!?

What tech products are robustly designed? The market incentives are towards disposability. Send it to the landfill and buy a new one, the new model is better anyway.

Re: The Applecare Hustle

#16

Post by 2Gkashmiri »

crazygringo wrote: post #6
Hamuko wrote: post #2

This seems crazy expensive. $2,097 in the span of three years? My home insurance is merely about 130 € per year and covers all of the accidental damage to all Apple (and all other) products in my home. Granted, the deductible is 150 €, so I'd only be able to get the screen repair of my Apple Watch down to 150 € (instead of $99), but it seems like hell of a lot better option than buying AppleCare.

How on earth is home insurance so cheap in the UK? In the US, the average policy is around $1,500/yr, the deductible is $500-$2,500, and your rates will go up the more claims you make -- so obviously nobody uses it for a damaged phone. I'm baffled by how UK insurers could possibly turn a profit on insurance... if people were filing a claim for every piece of technology they owned every time they accidentally damaged…

wait till you check indian rates.

if you open this link, give a random name, phone, email, and set place to delhi, property value to lets say 2 Crore and home contents value at 10 Lacs, which is around us $ 284,000 and that is a big big home in india. 95% cant even afford it. anyways, for this huge property value, the monthly premium comes at a mere USD $ 11/month. yeah. https://www.policybazaar.com/home-insurance-calculator/

Re: The Applecare Hustle

#17

Post by Rainymood »

lobochrome wrote: post #11

I remember a course on game theory at business school where we proved all insurance to be non-optimal. There were two ways to deal with catastrophic risk if I recall correctly, depending on the gain function: a) if catastrophic risk is infinite - no premium will be acceptable due to price. b) if catastrophic risk is discrete - it is optimal not to insure since the expected loss is ruinous anyways. Led me to be highly…

In theory, theory and practice are the same.

If you are interested in this and want to further your studies in this field try looking up this thing called "Prospect theory", it's like game theory+.

Re: The Applecare Hustle

#18

Post by fnordsensei »

mehwoot wrote: post #5

In contrast, the insured often relies on a recollection of their history and a ton of emotional reasoning to decide if they will be the statistical oddity to make "a profit" of having bought insurance. This isn't generally the point of insurance. The point of insurance is to amortise risk. Yes, the insurance company expects to, on average, get more money from insuring my house than the cost of any damage to it. But i…

During my decade or so as a consultant, I did a project with one of the oldest insurance companies in my country of residence (they've been around for well over 200 years). They made sure I was aware of their history, in order to understand their business.

They started out insuring farms against calamities. If a farm burned down, it was a proper disaster: for the farmer, for everyone who worked there, and for the surrounding area relying on the farm for food. So the farmers got together and started the insurance company on the premise that it's better for all of them, together, to take a continuous economic hit than to live under a constant existential threat, individually.

It's not only that they continuously pay to be insured before the disaster happens, it's also the fact that if they are helped during a disaster, they can continue to contribute afterwards, for as long as the farm exists. Whereas, if disaster hits and they are permanently gone, that's a permanent end to their contributions, as well as a hit to the community in countless other ways.

This particular insurance company was non-profit from the start, and still is.

For device insurance, I agree that you pay mostly for peace of mind. But like parent, I'm not sure I'm willing to write off all insurance as a racket.

Re: The Applecare Hustle

#19

Post by doublepg23 »

kennywinker wrote: post #14
ssivark wrote: post #4

1. Is this much repair indicative of abnormal use, or are Apple products not really robustly designed? 2. Why are repairs so damn expensive? Several hundred dollars each to repair a scratched screen or replace a torn earcup fabric!?!?!?!?

What tech products are robustly designed? The market incentives are towards disposability. Send it to the landfill and buy a new one, the new model is better anyway.

There's a cult around thinkpads, but even those have gone to the wayside in recent years.

Re: The Applecare Hustle

#20

Post by moksly »

mehwoot wrote: post #5

In contrast, the insured often relies on a recollection of their history and a ton of emotional reasoning to decide if they will be the statistical oddity to make "a profit" of having bought insurance. This isn't generally the point of insurance. The point of insurance is to amortise risk. Yes, the insurance company expects to, on average, get more money from insuring my house than the cost of any damage to it. But i…

I’m not sure if this is a Danish thing, but here you can add an electronic appliance insurance to your regular “indboforsikring” which is the policy form that covers your home and all the shit in it.

They come in various forms, but mine covers anything from throwing a wii controller into a TV to losing your laptop in a bag or having it stolen. It also covers all family members and is $80 a year.

It does require you to pay the first $230 of damages, so it’s not very useful to protect smartphone glass or other small damages, but it covers all the big stuff and it makes “do you want to buy extra insurance for your appliance” really easy to answer with a no.

Post reply on HN