I agree with WinkyBB’s statement that you’re purchasing peace-of-mind.
My wife and I rent, and have renters insurance tacked onto our car insurance plan. The cost is something like $10-12/month, and my hope is that I never need to make a claim against it.
I pay this money every month, so that I know I’ll be able to replace the things I worked for in case of an emergency or theft.
Insurance is a poverty trap. Those who must have insurance because they would be wiped out by the losses are the ones who can least afford it. Insurance comapnies aren’t charities and carefully calculate the odds so you will lose (on average). All the anecdotes in the world don’t change this.
Interestingly, wealthy people are among the least likely to have home contents insurance (among those who have at least something worth insuring). This is because although the loss is greater in absolute terms, wealthy people can easily afford to replace their stuff. The contents of their homes are only a very small fraction of their net worth.
Having said that, if someone spots a place where the odds are wrong (e.g. renters twice as likely to be burgled but don’t pay twice the premium) then there might be some rational argument that you could beat the odds.
Best to think of insurance as purchasing peace-of-mind rather than as a shrewd financial choice.
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