Is insurance economical if a person has the funds to cover any disaster?
I tend to agree with you that the more money you have, the less benefit you gain from insurance and the more potential to be better off without insurance. The benefit of insurance is that it reduces risk. You pay a fee to reduce risk. Risk is an economic cost. But the more funds you have available, the lower your risk. That makes the risk reduction from having insurance even more insignificant. But still, it boils down to your risk tolerance. There isn’t exactly a mathematical calculation to find the optimal decision on whether to have insurance or not because it comes down to how much you value protecting against an unlikely event. I don’t have life insurance to cover my funeral expense in case I die unexpectedly, but I am reasonably sure I will have more than enough assets and cash to cover the funeral expenses. But even then there is still risk that I could be wiped out completely by something else. I could be the victim of a major lawsuit or theft that wipes me out. I could help in
