Time, Bucks, Insurance Company discussed on The Dave Ramsey Show

Automatic TRANSCRIPT

Okay and the reason we know that is urine you're an insurance underwriter right right and you not so you don't have an actual aerial table works it started with them degree down the statistical probability of an event happening right and in also let's just let's look at prepaid legal this way if you spend more they're they're getting a total of three thousand dollars because they're over ten years because they're getting uh uh twenty five dollars total three hundred bucks a year right and so if you spend more than three thousand dollars let's just say this if the average person with prepaid legal spins more than three thousand dollars on legal fees on average over a 10year period of time mathematically they would be out of business wouldn't they now we had a true okay okay so that's how the insurance works that's the actuarial tables is the probability of the event happening but if you're going to be in the insurance business the actual cost of the probability on average a group of a group across a large groups has to be much less than what the person pays in premiums otherwise the insurance business goes are the insurance company goes out of business because they need to make a profit in they need to pay secretaries and overhead and they need to pay you and so on right yeah so you know basically you're better off to self insurer through the legal bill than you are to the two by legal insurance which is basically what you're doing i would selfridge there through that by having a good emergency fund.

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