Insure Your Phone or Your Paycheck?
Maren O'Neill2026-01-03T14:41:07-06:00Insure Your Phone or Your Paycheck? Several psychological and practical forces drive this mismatch: 1. Salience Bias: If It’s Tangible, It Feels Riskier We see our phones every day. We drop them, scratch them, and hear constant warnings to “get the extended warranty.” The risk feels real because the object is right in front of us. In contrast, the risk of losing income due to illness or injury is invisible and abstract. Even though the consequences are far worse, the scenario feels distant — so people tune it out. 2. Misjudging Probability People are more likely to insure something if they believe the risk is high. Phone damage? Very common — one survey found 66% of smartphone owners damaged their phone within a year. A long-term or temporary disability? People assume it’s unlikely, even though statistics show 1 in 4 workers will face a disability lasting longer than 90 days during their career. This mismatch in perceived vs. [...]
