yeah... but, for example, buying insurance on your rental car doubles it's cost. And getting anything out of insurance is such a hassle. If I had a nice new leased car and my brother put a dent in it learning to drive, I'd have to deal with it. even if it didn't jack up my insurance premiums, which it would, dealing with a little dent is probably going to cost you at least 5 hours. But the thing is, I don't rent; I own a jalopy. so the kid put a dent in it... so what? It wasn't the first dent, and won't be the last dent. Driving a car that is worth a weeks pay is a much lower stress experience, for me, at least, than driving a car that is half of a year's post-tax earnings. Sure, the thing will die one of these days. but who cares? Push the thing to the side of the road and call a cab and a wrecker to haul it off to the junkyard. borrow a friends car (because I'm free with loaning my jalopy, I have some credit) or rent until I find my next jalopy. It's been pretty good for the time I've had it.
Another example; a while back I stepped on my thinkpad. Now, being a 200lb guy, the monitor cracked.
Will insurance cover "A fat man stepped on it?" If they do, they'd probably pay retail to replace it (lenovo wanted $700 to fix it, and that'd be factored into premiums.) I think I ended up paying $80 for a new LCD and spent two hours installing it. Probably less hassle than dealing with insurance would have been.
Insurance is best for risks that are beyond your capability to deal with... Usually for small things, it's cheaper, long term, to deal with it yourself. And unless you /enjoy/ bureaucracy, it's usually less work, too.