Accepting Quote by Andrew Tobias
“The life insurance policies advertised on the radio with the line "You cannot be turned down for this coverage!" are actually saying, "For policies this small, it would cost us more to decide whom to turn down than simply to accept everybody - and make them pay through the nose."”
About This Quote
Source Book: The Only Investment Guide You’ll Ever Need, 2007
Insurance companies accept low‑risk policies because the cost of rejecting applicants exceeds the cost of covering everyone.
In simple terms: Insurers accept small policies to avoid higher costs of denial.
Key Takeaway
Understand pricing strategies in insurance.
Themes
finance
risk management
insurance
Mood
analytical
critical
Type
explanatory
educational
When to use this quote
- personal budgeting
- insurance comparison
- risk assessment
- policy negotiation
Key Concepts
adverse selection
pricing models
Questions to Reflect On
- Why do insurers prefer broader coverage?
- What are the trade‑offs of universal acceptance?
A Different Perspective
The statement may oversimplify complex underwriting processes.
