ARRL INSURANCE PLAN --- Experiences / Opinions / General Info Appreciated

[WD5JOY]

Good Day One and All:

It has been 20 years or so since I insured equipment through the ARRL Insurance Plan. Back then it was a different company than they currently use (HAYS). It looks as if they change insurers / agents (one or both) rather often, but this may be based on a multitude of "Google Hits" when I searched. Perhaps they do not make these changes as often as I gather -- if this really matters at all.

So ....... obviously I am looking in to obtaining insurance through the "league" and opinions and especially EXPERIENCES with the current agent / insurer is of importance to tome - thus, I seek input from "our group" here on QRZ.

Now - it APPEARS to me that if one has "Homeowner or Renter Insurance" that this residential coverage will be "primary" and the ARRL insurance "secondary". Might the TYPE OF LOSS (lightning perhaps) might be important when determining the "primary versus secondary coverage"?

In the event of say a $2000.00 loss for "lightning damage"? My current "Homeowner Policy" does not cover this type of "event" and I would "assume" the ARRL / HAYS policy does. However, "theft" IS covered by my "Homeowner Policy", but with a $500.00 deductible and I gather that the ARRL / HAYS policy would cover the $500 deductible and/or any amount up to the "replacement cost" of their policy?

Again - any opinions and especially "experience" with the ARRL / HAYS (or previous carriers) coverage will be greatly appreciated. Yep - I could "call them" and "ask"; however, "first hand experiences" with such matters sometimes is a better indicator of real-world satisfaction than the propaganda put forth by those benefiting from the policy premiums.

Thanks in advance!

Don / WD5JOY

[WB3BEL]

So, I can not comment directly on the value of the ARRL insurance plan specifically.

But I don't understand why anyone would buy insurance for their ham gear!

Insurance spreads the risk across a wide population pool while providing profits to the company underwriting the insurance and a cut for every middleman involved. Agents, sponsoring companies (perhaps the ARRL) etc.

Insurance is for situations where you can not individually bear the cost of an event yourself without disastrous financial harm. Things like your house or health or liability for your auto etc.

I would never buy insurance for ham radio "toys". If it broke I would buy another one out of my pocket. If I could not afford to replace it, I would do without until I had the means to replace it.

In general, you are not saving money by buying this kind of insurance. Statistically how could you with the insurers making profits and paying their costs ?

I'll give a rough example (maybe the dollars are all wrong but the concept holds). If you buy a policy for a $1000 ham rig for $40. The company has $10 administration costs and wants to make gross profit of 25% ($10). For them to make this work they can on average pay each insured $20. Or put another way they can pay 1 person out of 50 $1000 replacement costs.

Now look at it this way. If you had 1/50 odds of needing buy a new rig that cost $1000 the value of this is only $20. (1000*(1/50)). So you are buying $20 of value for $40. Does this make sense for a "toy"?

The same kind of uneven odds exist for those "extended warranty" plans that uninformed buyers purchase all the time... The house very very very seldom loses!

[AC0FP]

I have my FT-950, antenna, rotor, and miscellaneous radio items insured. My cost from the ARRL is $35 per year. I have no idea what the "odds are" that my equipment would be destroyed.

fp

[KB1ORM]

I agree with the logic that one's more likely problem woud be a "break down" which is (of course) uninsured anyway. Also we are talking about "toys". Is the insurance a good buy--probably not.

[WA3UCR]

So, I can not comment directly on the value of the ARRL insurance plan specifically.

But I don't understand why anyone would buy insurance for their ham gear!

Insurance spreads the risk across a wide population pool while providing profits to the company underwriting the insurance and a cut for every middleman involved. Agents, sponsoring companies (perhaps the ARRL) etc.

Insurance is for situations where you can not individually bear the cost of an event yourself without disastrous financial harm. Things like your house or health or liability for your auto etc.

I would never buy insurance for ham radio "toys". If it broke I would buy another one out of my pocket. If I could not afford to replace it, I would do without until I had the means to replace it.

In general, you are not saving money by buying this kind of insurance. Statistically how could you with the insurers making profits and paying their costs ?

I'll give a rough example (maybe the dollars are all wrong but the concept holds). If you buy a policy for a $1000 ham rig for $40. The company has $10 administration costs and wants to make gross profit of 25% ($10). For them to make this work they can on average pay each insured $20. Or put another way they can pay 1 person out of 50 $1000 replacement costs.

Now look at it this way. If you had 1/50 odds of needing buy a new rig that cost $1000 the value of this is only $20. (1000*(1/50)). So you are buying $20 of value for $40. Does this make sense for a "toy"?

The same kind of uneven odds exist for those "extended warranty" plans that uninformed buyers purchase all the time... The house very very very seldom loses!

+1 Excellent post.

[K8ERV]

My dad said to stand the small losses and insure for the big ones. Sounds right to me.

TOM K8ERV Montrose Colo

[KC8VWM]

A little trick I learned a long time ago.. If you want to know how good an insurance plan might or might not be, ask them how many claims and much money they paid out in claims for a given period of time. If they don't have the answer, then run fan as you can.

[K1OIK]

So, I can not comment directly on the value of the ARRL insurance plan specifically.

But I don't understand why anyone would buy insurance for their ham gear!

![/B]

Insurance is not about beating the house.
You buy it for peace of mind. What is the value of that?

[WA6MHZ]

If I insured ALL my radios on the policy, I would have an insurance bill of $100K a year! So I just gotta take my chances.

[AB1OD]

The basic theory behind insurance can be described with a simple example:

Which would you prefer: a 100% chance of paying $10, or a 0.1% chance of losing $5,000?

In this example, insurance is made possible by the people who don't want to risk the big shock (but are willing to have a known expense), and companies that are willing to pool a bunch of (0.1% chance of losing $5k) risks, and make a profit on the difference between that and the bunch of $10 premiums collected, net of expenses, etc.

It is always more cost-effective to accept the risk that you can afford to take, and only insure the risk that you can't handle.

Heck, even insurance companies buy insurance.

^{This lesson in basic insurance economics has been brought to you by AB1OD, resident actuary.}