>> "...pay out when the driver is to blame..."

That's what auto insurance marketing says, and sometimes it even works that way. But a key part of the business model is to take your money for years, and then when you do have to submit a claim, they welsh on a technicality.

"Your vehicle is licensed in Seattle, but our records show you spent more than 50% of your time in California this year, therefore your coverage is retroactively void even though we took your money for 11 months."

If you actually read the giant auto insurance contract you signed, it is full of this and other similar loopholes, which are quite deliberately inserted to allow the insurer to manipulate the magnitude of its payouts.

I dont know. I always read my policies. My auto insurance policy is about 13 pages of large font which is written in plain, easy to understand, English. All the "loopholes" seem pretty straightforward and reasonable to me. They seem pretty easy to avoid to me.

Yea, it stands that lying about where you live to an insurance company would be a good reason to deny your claim. You were paying the (probably cheaper) Seattle rate, not the CA rate. If you split your time between two different places just get the proper insurance for that.

From my personal experiences with vehicle insurance, I think you're a bit optimistic. Does your policy have an "act of god" clause? Because that's a loophole big enough to drive a truck through. (Which is what happened to me, when a shipping truck driver totaled my car when driving it through a hurricane without covering their load, and the insurance company refused to assist because it was an "act of god")

i can say this as sure as anything else in this world: anyone who defends insurance companies has surely, surely never actually dealt with one in a time of need.

hn is full of hypersmart young people with very weak mental models of how things actually work in the real world beyond the tech industry, and probably have had very few if zero bad things happen to them (yet).

One problem with the pessimistic mental model is that it provides nowhere else to go with reasoning. For example, how can a tracking device cause problems with insurance claims, if insurance companies never pay claims anyway? If the worst is always expected, then any heuristic returns the same result.

The other problem is that it's contradicted by mountains of evidence--insurance companies pay millions of claims ever year. I know a lot of people who have been paid for losses by insurance companies, including me, even when they were at fault.

Extreme pessimism is itself a weak mental model in that it does not adapt itself to evidence. It takes no effort at all to parachute into any given conversation and say "that'll never work."

That implies an exclusively pessimistic model, however. My suggestion was to simply have a more pessimistic prior. As you say, insurance has to pay out _something_ _sometime_ by the data, and I've certainly seen some of those payouts myself (and sometimes even had them be advantageous in my favor), but if there's enough prior for adversarial interaction it seems a more more robust approach to plan for a worst case scenario even if it doesn't end up happening; or at least don't be exclusively optimistic, for this provides the same but inverted issues as exclusive pessimism.

Yes, surely I have. I've had nothing but positive experiences with auto insurance companies. Health insurance is another story.