The car insurance works because the incentives are aligned. Some people pay more for higher quality/coverage insurance. Some people pay less for cheaper insurance. The repair shops cannot charge arbitrary prices since the customer does not want their insurance companies to overpay, or else the customer’s premium will go up next year. The insurance companies cannot charge premium way higher than the market or else; the customers would leave. If they charge too low, they go out of the business.
Shops love selling them since the margins are great, the local government loves them since it brings in additional tax revenue, and the tourists love them since they don’t want local bacteria to interfere with their enjoyment of authentic experiences. Mother nature […]
KBB is used in the US for estimating the value of a used car before buying/selling it. While helping friends buy used cars, I felt that it always overvalued the car. I feel there is an anchoring effect in play here. A […]