The business plan of all the companies is to get in as much as possible and pay out as least as possible

You are wrong.

You either haven't got the slightest clue about what you are talking about or you are telling lies.

They get away with murder as do most insurance based products

Do you have any non-compulsary insurance? If so, why? (Not a rhetorical question)

I beg to differ but I know exactly what I am talking about I am afraid you do not seem to know the workings of the insurance market.

OK, let me explain:

The vast majority of car warranties are NOT purchased by the public, they are purchased by dealerships who include them with the car purchase.

Now if (as you say) the insurance company pays out as little as possible, do you think these dealerships will say:

1. "that's OK mr warranty company that you have upset my customers, caused me to lose the customer & made me pay out for the repair in addition to paying you for the warranty; or will they say
2. "get &^%$£ mr warranty company"

Well I'll give you a clue, it would be 2. So the warranty companies would lose the vast majority of their business overnight if they behaved as you say. They don't; you're wrong

Edited by bonzo dog on 02/06/2012 at 20:05

You obviously do not understand the algorithms used for the BC.

I have absolutely no problem with stating that I haven't a clue what you are talikng about.

Please enlighten me with regard to how this disproves my comments

I would never take out any non compulsory insurance (with the exception of comprehensive motor insurance but only so I can drive other cars).

Insurance is like the lottery-a voluntary tax on those with little capital. On average you lose.

It's better to only buy possessions that are within your means. People only require nonsense like GAP insurance and 'warranties' bdecause they bought a car that the cannot afford to run and maintain.

Dealerships buy these warranties because they want to divest themselves of the hassle of broken cars so they can concentrate on selling cars.

Life insurance? Don't have dependants.

Contents-not worth an awful lot.

House? I don't own it.

If I owned a house, I would take out insurance because the cost of a fire would be catastrophic.

But insurance against a broken alternator? FFS.

Hmmmmm? So which is is, "would" or "would never"?

Nit picking. ~£200 premium against a value of £200,000 makes sense because an individual cannot bear the cost of rebuiulding a badly damaged house which overrides the low expected payout.

In the case of warranties you take it out against the "catastrophy" of a new engine or gearbox which can easily run into thousands;

Then find that the fault was attributed to a failed fastener which isn't covered, and all other damage is considered "consequent" so no payout. You can pick up a second hand engine for most cars for under a grand. Same with gearboxes. A £400 premium loaded with get out clauses against £1000 liability doesn't look so attractive, does it?

How often do sympathetically treated engines catastrophically fail anyway? Automatic gearboxes are a different matter since hard driving=hard shifting. Since I wouldn't countenance driving an auto that is not a consideration for me.

Most people looking at warranties are seeking to run an ageing luxo-barge for peanuts. I'm sorry, but the only way to do this is if you understand that you are your own warranty and act accordingly.