What is the purpose of car insurance?

 

 

Now I understand what car insurance really does, they cover losses mainly out of pocket, reduce risk which covers costs of many, but I have trouble understanding why a company is needed to do this. Lets say on an average a person pays 150/month for coverage. Over time this money adds up. After one were to be in a collision, they are presumably "covered", yet a deductible is payed, then they increase the payments.

 

 

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