8.1.1 To insure or not to insure?
If you had complete freedom to make your own decisions about insurance – if there were no legal or contractual requirements to have insurance – which of these insurance products would you buy and which would you not buy?
- Travel insurance for a one-week holiday overseas. Cost of insurance: £50.
- Home insurance in respect of your property being flooded. Cost of annual insurance: £400.
- Extended warranty insurance coverage for breakdown of a washing machine. Cost of three-year insurance: £200.
Figure 1