Insurance companies are in the risk-taking business. They collect premiums and pay claims when they occur. But they are not the only ones that play in that sandbox. Every consumer decides what risks to take and how to hedge against loss. We have different risk tolerances, and that determines a great deal of our daily experience. Let’s see how you and your insurance company are more alike than different.
Almost all insurance policies have deductibles — the amount of money you’re responsible for paying before the insurance kicks in. What deductibles do you have? If you have a large deductible — and when I say large, I’m talking multiple thousands of dollars or more — then your risk tolerance is higher. Perhaps you have enough cashola in the bank that you can afford to pay a few grand or more without blinking an eye. If you have a lower deductible, it may mean you have less capital on hand and need the insurance company to step in with its checkbook sooner rather than later.
