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What is insurance?
Feb 14, 2023
Season 4 | Episode 2

What is insurance?

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And what's the story behind all this "rainy day" business?

There’s a major storm brewing, and Ryan and Bridget are stuck inside. It’s the perfect opportunity to answer a question they got from Archer in Los Angeles: What is insurance? Archer’s dad is an insurance agent, and Archer wants to know what his dad does all day.

Turns out insurance is uh, complicated. From home insurance to health insurance, we’re going to figure out what it is and why people use it. Plus, we have a catchy song to help you remember the difference between some confusing insurance jargon.

Camila Kerwin

And now … tips for grown-ups listening to “Million Bazillion” with kids

Money Talks

After you listen to the episode, here are some questions you can ask kids about insurance:

  1. What are some types of insurance that someone might buy today?
  2. What’s the difference between premium and deductible?
  3. What are 3 things you wish were covered by insurance?

(Scroll down or click here for answers!)

Tip Jar

If you and your kids want to learn more about insurance, here’s some reading material you might find helpful:

  • Bridget and Ryan learned about how Italian merchants tried to reduce their risk through their own form of insurance. Learn more about the history of making things less risky: The History of Insurance
  • Adults and older listeners who want to know what happens when insurance doesn’t work the way it’s supposed to can take a listen to this episode of Marketplace’s climate podcast, “How We Survive: Risky Business.”

Gimme 5

Do your kids have questions about what you do for work? Let us know by filling out this online form.

Money Talks Answers

  • Answers will vary. May include: health insurance, car insurance, pet insurance.
  • “Premium” is the price of an insurance policy, typically paid monthly. “Deductible” is the amount an insurance client pays before coverage kicks in.
  • Answers will vary.

This episode is sponsored by Greenlight.  (For a limited time, get $10 when you sign up for a Greenlight account at greenlight.com/MILLION).

Million Bazillion: S4 E2 Insurance Script/Transcript 

Note: Marketplace podcasts are meant to be heard, with emphasis, tone and audio elements a transcript can’t capture. Scripts may contain errors. Please check the corresponding audio before quoting it

 

Cold Open:

(SFX: WE’RE INSIDE BUT HEAR WIND WHIRRING OUTSIDE)

 

RYAN: Canned beans?

 

BRIDGET: Check.

 

RYAN: Three month supply of toilet paper?

 

BRIDGET: Check.

 

RYAN: “Everybody Loves Raymond” The Complete Series on DVD, with a DVD player and backup generator to power the DVD player so we can watch Raymond in case we lose electricity.

 

BRIDGET: Check…. Y’know, Ryan, I think we might be overplanning.

 

RYAN: Overplanning, you say?!?! Tonight’s weather forecast is “cloudy with a chance of meatballs” and you think we’re overplanning? I can practically smell the oregano in the air!

 

BRIDGET: I don’t think that’s the real weather forecast for tonight. Are you sure you didn’t fall asleep listening to an audiobook or watching TV and maybe got confused?

 

RYAN: All I know is I heard the phrase “cloudy with a chance of meatballs” and I’m not taking any chances.

 

BRIDGET: Even if delicious Italian meatballs did fall from the sky, what’s the worst that could happen?

 

RYAN: I’ve never been through a meatball storm before so I’m going to be as prepared as I can before I lose it all in a marina flood! So let’s continue… garlic bread for dipping?

 

BRIDGET: Check.

 

RYAN: Italian dictionary.

 

BRIDGET: Check. Why do we need that?

 

RYAN: Meglio prevenire che curare.

 

BRIDGET: Huh?

 

RYAN: That means “better safe than sorry” in Italian!

–Theme Music–

BRIDGET: You’re listening to Million Bazillion. I’m Bridget.

 

RYAN: I’m Ryan. And We Help Dollars Make More Sense.

 

(SFX: HAMMERING OF NAILS)

 

BRIDGET: What are you doing there?

 

RYAN: Boarding up the windows, just in case it’s not just meatballs falling from the sky, but something heavier, like entire cannolis or charcuteries of gabagool. Oww!

 

BRIDGET: OK, while you’re preparing for that, let’s listen to today’s question.

 

ARCHER: My name is Archer and I’m 9 and I’m from Los Angeles California. My question is, what is insurance and how does it work. My dad is an insurance agent so I want to know what he’s doing for his job. Bye.

 

BRIDGET: Now THIS is a timely question. Insurance is protection against the RISK or chance that a big, bad, expensive problem is going to happen to you. Because, when you have insurance, the insurance company helps pay some of that bill.

 

(SFX: HAMMERING CONTINUES)

 

RYAN: Eh, sounds a bit too good to be true if you ask me.  Hey, can you please hand me the duct tape? I wanna insulate the window cracks against marinara spillage.

 

BRIDGET: Sure, here ya go. [SFX DUCT TAPE] There’s so much to cover in this answer, I mean, insurance even confuses ADULTS, and how a person feels about it gets at the heart of their core values!  Looks like we have our work cut out for us.

 

RYAN: I know, I don’t think we’ve properly fortified our grain silo, in the event we have to stay here through next winter.

 

BRIDGET: Wait, why are you working so hard to get ready for this storm, what are you worried about?

 

RYAN: (GRUMBLES)  I don’t have insurance, OK?!?

 

(SFX: RECORD SCRATCH)

 

BRIDGET: (GASPS) WHAAAAAA? You don’t have any insurance? Not on your car, not on your house?

 

RYAN: NO. Not on my jar, not on my mouse! No insurance. None.

 

BRIDGET: Oh. Well, then we have our work cut out for us explaining insurance! And we’ll get into it right after this.

 

-Asking random kids some NOT SO random questions-

ANNOUNCER: And now it’s time for asking random kids NOT SO random questions. Today’s question is: If you got to buy the grownups in your life a gift, what would you pick out for them?

 

RANDOM KIDS: Well I would buy my mom like jewelry or purses. Jewelry! And I would buy my dad wireless earbuds. Chocolate! Because most people like it. I would pick out a mug from Shutterfly with a picture from the time that we went to Costa Rica on it. Maybe if they had been wanting something for a while, get like that thing with a picture of me on it. I would buy my grandmother a new TV since her’s is old. Probably like a computer or something. Something a parent would need like a hair dryer or a radio or something. She’s probably gonna like that.

 

ANNOUNCER: That was Aaron, Roman, and Rafi from New York, Alan and Joel in Missouri,  Ava in Minneapolis, Joshua in Denver,  and William in Pittstown, New Jersey.This has been asking random kids not so random questions.

Part 1:

 

(SFX: WORSENING STORM SOUNDS FROM OUTSIDE)

 

BRIDGET: Ok welcome back to Million Bazillon, and it sounds like the storm is starting to flare up out there.

 

RYAN: Yeah, the meatballs are probably really coming down, they sound extra saucy!

 

BRIDGET: I mean, it sounds just like regular rain, but you blacked out the windows, so we can’t tell.

 

RYAN: I personally think it’s raining meatballs and I stand by it!

 

(SFX: FADE OUT STORM)

 

BRIDGET: Ok, so let’s get back to this question from Archer.

 

(MUSIC: PENSIVE, PLAYFUL MUSIC STARTS PLAYING)

 

RYAN: Right right, what is insurance and how does it work? A classic two-parter!

 

BRIDGET: The Insurance we’re talking about is something that helps when the unexpected happens…unexpected but maybe not unpredictable.

 

RYAN: Oh, like on Everybody Loves Raymond when Ray and Deborah are trying to have a nice evening to themselves and Ray’s parents barge in and ruin everything?

 

BRIDGET: No no no, I mean unexpected things that cost money, like breaking your arm. No one plans to break their arm, but it DOES happen. You could be charged thousands of dollars in medical bills. So people have health insurance to help them pay those really big bills. That’s just ONE type of insurance.

 

RYAN: Hold it Hold it Hold it! This all SOUNDS great but I think you’re leaving out something pretty important here.

 

BRIDGET: What do you mean?

 

RYAN: Well, insurance isn’t some kind of free charity operation! You have to PAY for insurance!

 

BRIDGET: That’s true, but Ryan, it’s worth it to feel safe and protected!! I have ALL the insurance, so I’m always prepared. Home insurance, car insurance, pet insurance, travel insurance. Boat insurance.

 

RYAN: You don’t have a boat!

 

BRIDGET: But if and when I do get a boat, I’ll be covered!

 

RYAN: But insurance doesn’t always work the way it’s supposed to! Insurance companies like to  find ways of wriggling out of covering you. You know I used to have insurance. Did I ever tell you about the time a grand piano fell on my car? The insurance guy told me, “Sorry, you only have coverage against Baby Grands, not against grands. Not so grand, is it? Bye, baby!”  And that’s why I promised myself, from that day on, I would never be covered again!

 

(SFX: RAIN PICKS UP. LIGHTING THUNDER)

 

RYAN: Hooo boy, really coming down out there!

 

(SFX: ELECTRIC BLAST)

(SFX: ELECTRICITY “POWERING DOWN” SOUND)

(SFX: FADE OUT STORM)

 

RYAN: Oh no! The power just went down! No need to be alarmed, I got flashlights. I just need to remember where I hid them in this pitch blackness.

 

(SFX: A BUNCH OF STUFF CRASHING)

 

RYAN: Phew, we’re lucky I didn’t just break my arm!

 

BRIDGET: Look, we can’t just sit here this entire storm and try to answer Archer’s question on our own in the dark. Let’s see, my phone is still working, why don’t we just CALL someone who knows more about insurance?

 

RYAN: Sure, yes, but if they try to sell you some snake oil or magic beans, don’t buy ‘em!

 

(SFX:FACETIME ISH DIGITAL DIALING NOISE)

 

BRIDGET: No no no, we’re going to talk to Hannah Farber, she’s assistant professor of history at Columbia University where she teaches, researches and writes about early American history, especially about commerce and trade and business back during the American revolution. So let’s hear what she has to say!

 

(SFX: ANSWER CLICK/BEEP NOISE)

 

HANNAH: Hi Bridget.

 

BRIDGET: Hi Professor Farber! This is Ryan–

 

HANNAH: Hi Ryan.

 

RYAN: Hi Professor Farber! I trust you are properly sheltered from tonight’s meatball storm.

 

HANNAH: What?

 

BRIDGET: Ugh, Ryan!. Thanks for taking my call,  Professor Farber! Can you tell us how insurance was invented?

 

HANNAH:So insurance, in its modern form, we think started in the city states of what’s now Italy–

 

RYAN: I knew Italians were involved in this in some way. And not the lovable Barone family of Everybody Loves Raymond, good show.

 

(SFX: HARP GLISS)

(MUSIC: ITALIAN RENAISSANCE MUSIC)

 

HANNAH: Maybe around the year 1400 when merchants have this really valuable cargo, so merchants being guys who buy and sell for a living and they send stuff on ships to faraway places.

 

(SFX: OCEAN SPRAY, SAILORS)

 

HANNAH: But they live in a really dangerous world where ships sink all the time. There are storms, there are pirates, there are wars.

 

(SFX: MORE VIOLENT WAVES. SWORDS CLASHING. SHOUTING)

 

HANNAH: So this is a dangerous world and what merchants want to do is figure out how to share risks with each other. So that if you have all of your stuff on one ship and the ship goes down, you are not bankrupted all alone. So one thing that merchants do is they come up with this idea of an insurance policy.

 

BRIDGET: That probably went something like this…

 

(SFX: ITALIAN MUSIC. BIG ECHOEY HALL WITH LOTS OF ACTIVITY)

 

MERCHANT 1: (ITALIAN ACCENT) Im’ma sending my stuff on this voyage and it’s pretty risky. A storm might sink my ship or it could be stolen by pirates. Can you guys help me out?

 

INSURERS: [MUMBLING AMONGST THEMSELVES]

 

LEAD INSURER: [CLEARS THROAT AUTHORITATIVELY, ITALIAN ACCENT] It’s-a me, an insurer. How about this. You pay us $100 dollars–

 

BRIDGET: They were probably using a currency called “florins” back then!

 

LEAD INSURER: You pay us 100 florins. If your ship makes it back safe, you end up with the 1000 florins your cargo is worth, minus that 100 florins you’ve already paid us, so you’ll take home 900 florins.

 

RYAN: Okay, so you make 100 florins while I do all the work?! And if my ship sinks? What does this “insurance” get me?

 

LEAD INSURER: Iff-a your ship sinks, we’ll pay you 1000 florins, to replace what your cargo was worth. Okie dokie?

 

MERCHANT 1: Sounds-a good! Here we go!

(SFX: ITALIAN MUSIC FADE OUT)

 

BRIDGET: So you get some money back to help pay for your loss, , you would be “protected” from financial ruin. Professor Farber, how would the insurance companies back then decide how much to charge the sea merchants?

 

HANNAH: So the price of the insurance policy depends on where you’re going, the time of year, whether it’s hurricane season maybe. The price of the insurance policy also depends on the risk of the cargo you’re carrying.

 

(MUSIC: ITALIAN RENAISSANCE MUSIC)

 

MERCHANT 1: Imma shipping gelato! ice cream!

 

MERCHANT 2: My ship is-a filled with explosives!

 

MERCHANT 3: I have rocks! Wa-hoo!

 

(SFX: ITALIAN MUSIC FADE OUT)

 

HANNAH: If you are carrying a cargo of rocks,well,  not much is going to happen to your rocks while you’re going from place to place. If they get wet, they’re still rocks.

 

RYAN: Wait, why would someone ship rocks?

 

HANNAH: if you are carrying ice cream or explosives, your cargo is a lot more risky. Your ice cream might melt. Your explosives might blow up. In that case, the insurer might say, we’re going to charge you more because we think it’s pretty likely that something bad is going to happen while on the way to your destination..

 

BRIDGET: Oh, so the price you pay for insurance all has to do with how likely it is that the bad thing you’re protecting against…is going to happen.

 

(MUSIC: ITALIAN RENAISSANCE MUSIC)

 

LEAD INSURER: Ok. So, we’ll insure the rocks for-a 50 florins.

 

RYAN: Yeah, and why would someone ship rocks?

 

LEAD INSURER: The gelato ice cream for 200 florins, and the explosives for, hmmmm, say, 500 florins. I’mma not in the mood for a big risk today.

 

(SFX: ITALIAN MUSIC FADE OUT)

 

RYAN: I’m still not sure if I “buy” this insurance scheme, but here’s another thing.  When people talk about insurance, they use these words, “premium” and deductible.” What are they even talking about?

 

HANNAH: You know, it’s a funny thing. Insurance jargon has been an aspect of the insurance industry for a long time. So you shouldn’t let that intimidate you when you learn about insurance. So a premium is a thing you pay up front, the price of the insurance policy.

 

BRIDGET: That’s the 100 florins we paid at the beginning of the trip. Oh, and the “policy” is just like the agreement or contract between you and an insurer.

 

HANNAH: And a deductible is a thing –they say even if you experience SOME loss on your cargo that’s still your problem. Your policy only kicks in if you’ve lost a significant amount of your cargo.

 

BRIDGET: Oh, because maybe the insurance company wants to make sure that you’re still careful on your trip. You’re gonna make sure your ice cream isn’t melting and your rocks are uh…secure. You’ve got some skin in the game to keep your stuff safe before the insurance company has to step in.

 

HANNAH:  Yeah, exactly.

 

BRIDGET: Deductible. Okay, I think I get it! Thank you so much, Professor Farber!

 

HANNAH: Goodbye guys!

 

(SFX: DIAL TONE)

 

RYAN: (FAST) Wait, why would someone ship rocks? Ahhhhh.

 

BRIDGET: Wow, that was great talking to Professor Farber. And good idea to ask about premiums and deductibles, I always confuse those two. I wish I had an easy way to remember the difference.

 

RYAN: Well, Bridget, you’re in luck because when I heard we were doing an insurance-themed episode, I immediately called my good friend, Broadway sensation, Lin Manuel Marimba-

 

BRIDGET: Lin Manuel Miranda?

 

RYAN: No. Lin Manuel Marimba, different guy, and I asked him to write us a song to teach the difference between premiums and deductibles. And Lin, not being very busy, immediately agreed. This is that song.

 

(MUSIC: CARNAVAL STYLE ACCOMPANIMENT)

 

RYAN: (SINGS)

Adults will lecture night and day about the things they know

They’ll insist they’re always right- but this is just for show

Here’s two words about which they won’t have great assurance

Two words that always come up in conversations ‘bout insurance

 

(MUSIC: CONTINUE SONG MUSIC LIGHTLY UNDER DIALOGUE)

 

BRIDGET: Hey, the storm has cleared! We’re free to go outside!

 

RYAN: Let’s take this premium and deductible song to the streets!

 

(SFX: HARP GLISS, BIRDS CHIRP)

 

RYAN: (CONTINUES SINGING)

Allow me to continue our lesson melodically

To have insurance, you must pay a premium periodically

When you get in an accident and make an insurance claim

Your premium goes up, that’s the name of the game!

 

A deductible on the other hand is money you have to pay

Before insurance covers you, this is just the way

A deductible is some annoying amount like 2 thousand dollars

If you want to complain, get in line with the other callers

 

BRIDGET: Um, by the way, it looks like it didn’t rain any meatballs. Looks like a totally normal rainstorm.

 

RYAN: Wait now, are we sure the moisture covering the ground isn’t … meatball juice?

 

BRIDGET: I’m pretty sure it’s rain. If it rained meatballs all night, how come we don’t see any?

 

RYAN: Maybe the city cleaned them up already?

 

BRIDGET: Like in the last five minutes? The city able to clear the streets of thousands of meatballs?

 

RYAN: Maybe. We’ll never know.

 

BRIDGET: Ryan, it’s rain.

 

RYAN: (CHANGING SUBJECT) Hey, I got an idea!! Let’s run across the slippery sidewalk and splash around in the puddles!

 

BRIDGET: Ok, just be careful running on a wet sidewalk!

 

(SFX: FOOTSTEPS RUNNING IN PUDDLES)

 

RYAN: It’s ok! It’s a musical number, nothing bad can happen!

(SINGS)Deductible and premium, these are two words to know

If you’re to be bohemian and save yourself some dough-aaaaaahhhh!

 

(SFX: SLIPPING AND FALLING SOUND, ADD THUD)

 

RYAN: Ahhhh, my arm!

 

BRIDGET: Are you ok?

 

RYAN:  Good news, my face- or my “moneymaker” as I call it, appears unscathed. Bad news, feels like maybe I broke my arm. And worse news, I don’t have medical insurance.

 

(SFX: DRAMATIC STING)

 

BRIDGET: This seems like it could be an interesting opportunity to get into how health insurance works!

 

RYAN: And to fix my arm right?

 

BRIDGET: Oh yeah, of course, and to fix your arm. When we come back from this quick break.

-MIDROLL (CREDIT BREAK)-

 

Part 2:

(SFX: MILLION BAZILLION STING)

 

(SFX: MOVING CAR INTERIOR) (MUSIC: INTENSE MEDICAL DRAMA MUSIC)

 

BRIDGET: Hi friends. We’re back. Turns out, in the middle of answering Archer’s question about insurance, Ryan fell and hurt his arm! We’ve just arrived at the hospital to learn a little more about health insurance.

 

RYAN: Oww!

 

BRIDGET: And to fix his arm.

 

RYAN: This reminds me of the series finale of Raymond where Raymond goes to the doctor and they can’t bring him out of anesthesia and his brother Robert goes, “Let me in there. I can wake my brother up.” Real tearjerker.

 

BRIDGET: Okay, come on, let’s go inside, we’re here.

 

(SFX: SLIDING DOORS, HOSPITAL BEEPING) (MUSIC: HAPPY UKELELE MUSIC PLAYS)

 

DOC MCSNUGGLES: My name is Doc McSnuggles! Whether you’re a giraffe with a sore throat or a centipede with a bad back, I’ll fix you up in seconds flat!

 

RYAN: Oh no, you brought me to Doc McSnuggles? This isn’t a real hospital! She treats, like, stuffed animals.

 

BRIDGET: What’s wrong with that? It’s cute! Kids love Doc McSnuggles! And the wait times here are very reasonable.

 

(SFX: WAITING ROOM AMBIENCE) (MUSIC: WAITING ROOM/ELEVATOR MUSIC)

 

RYAN: (SIDE MOUTH) This waiting room is wild. All kinds of problems: a rainbow unicorn with a sprained horn, a snake eating it’s own tail-

 

NURSE: And what’s your problem, Mr. Frog?

FROG: I got stung by a scorpion.

 

NURSE: (SIGHS) Again?

 

FROG: He said I should trust him because he was crossing the river on my back, but then stung me anyway!

 

SCORPION: What? It’s in my nature. (SFX WHIP)

 

BAT: Excuse me, excuse me, there appears to be a mistake with my medical bill! I’m being charged for feather treatment and I’m a bat! I don’t even have feathers!

 

NURSE: Mrs. Batts, you’re gonna have to take that up with your insurance company.

 

BAT: I’ve been on hold with them all morning!

 

(SFX: HOLD MUSIC COMING THROUGH CELLPHONE)

 

OPERATOR RECORDING: Your call is important to us!

 

NURSE: Ok, next up, Perez, Ryan. Jingleheimer.

 

BRIDGET: Your middle name is Jingleheimer?

 

RYAN: Shhhh. Tell the whole world while you’re at it.

 

NURSE: Doc McSnuggles is ready to see you, follow me.

 

BRIDGET: Good luck, Ryan! Be brave!

 

(SFX: CURTAIN PULLED BACK)

(SFX: LOSE WAITING ROOM AMBI)

(SFX: HOSPITAL ROOM AMBI, BEEPING MACHINES)

 

DOC MCSNUGGLES: Ok, let’s take a look at that arm. Ohh. Definitely fractured, yep. I’m gonna have to set it real quick. Should take juuuust a second.

 

(SFX: RIFLING THROUGH DRAWERS)

 

DOC MCSNUGGLES: Hmm, now where’s that arm sling for humans?… Nope, that one is for hippos.

 

(SFX: THINGS TOSSED AROUND THE ROOM)

 

RYAN: So, Doc McSnuggles, I have a confession to make.

 

DOC MCSNUGGLES: I’m not that kind of doctor. I’d gladly refer you to a good therapist, Dr. Naomi Snuggle-Stutz–

 

RYAN: Oh no, my confession-  I don’t have health insurance.

 

DOC MCSNUGGLE : Hey, not my problem, I’m gonna treat you either way. But, for future reference, health insurance should help with some of those big medical costs. You might wanna get it.

 

RYAN: Well how am I supposed to even do that?

 

DOC MCSNUGGLES: Any way you can. Some people get health insurance through the government. Some people get it through their jobs. Some folks are on their own to buy it. But it’s like us stuffed animal physicians say…

 

(MUSIC: SAME AS “PREMIUM, DEDUCTIBLE”)

DOC MCSNUGGLES (SINGS): One day, you’ll be a patient– for one reason or another. 

And when it’s your turn, you want to be covered.

 

RYAN: I feel like I’ve heard that song somewhere…

 

DOC MCSNUGGLES: And let me tell you, some of my patients go years without coverage because they don’t have jobs and can’t afford to buy insurance on their own. But how are they supposed to get jobs when they’re stuffed animals? Then they don’t come to see me when they’re sick. And by the time they do come, they got some kind of stuffed animal disease that’s harder to treat. Oy. It gives me agita, this system.

 

RYAN: But it seems like, even when they have insurance, a lot of patients are frustrated and confused.

 

DOC MCSNUGGLES: Oh, I see you’ve been sitting in my waiting room. Yep, whether you’re a mermaid cat, a fluffy pink elephant, or a bengal tiger, pretty much all my patients agree it’s not a perfect system. And sadly, my patients usually have to navigate it when they’re sick and already not feeling well.

 

RYAN: Why don’t you just change the rules of your hospital?

 

DOC MCSNUGGLES: Oh, this isn’t my hospital and I don’t make the rules. There’s a really big company that owns this hospital and a lot of others. They talk to the insurance company about prices and how much insurance will cover. And then there’s the government, of course.

 

RYAN: The government? What do they have to do with my medical care?

 

DOC MCSNUGGLES: The government makes the rules for how all this works. In my experience, what’s best for the health of the patient gets lost in the mix. Oh, hey, look over there, a dancing lasagna –

 

RYAN: Really? Where?

 

(SFX: BONE CRACKING)

 

RYAN: Ahhhhhh!

 

DOC MCSNUGGLES: Sorry, I had to catch you off guard. That’s the only way to set these fractures. OK, you’re all set. That fracture should heal up in a few weeks.

 

RYAN: How much is this all gonna cost me?

 

DOC MCSNUGGLES: Y’’know, I don’t even know. But as long as this health stuff is as expensive as it is, people are going to need help paying for it. . And that’s where insurance comes in. Don’t worry though, you’ll catch a bill in the mail. They never forget to bill.

 

RYAN: Ok, thanks, Doc McSnuggles.

 

DOC MCSNUGGLES: Don’t mention it.

 

(SFX: CURTAIN PULLED BACK)

(SFX: WAITING ROOM AMBIENCE)

 

BRIDGET: So how did it go?

 

RYAN: Well, I’m sold. I understand the reasons why insurance exists and why it MIGHT be a good idea to have some.

 

BRIDGET: REALLY?? Okay, let’s go home and get you signed up for ALL the insurance! Ooh, there’s this policy that will insure your toaster and it comes with a blender!

 

RYAN: Whoa whoa, I didn’t say I’m ready to get ALL the insurance. Besides, just because SOME insurance is helpful, it doesn’t mean ALL insurance is worth it!

 

-LET’S ASK AN ECONOMIST-

(MUSIC: MUSICAL STING. LET’S ASK AN ECONOMIST)

 

AVRY: Hi, I’m Avry. I’m 8 years old, I’m from San Diego California. Let’s ask an economist!  An economist is someone who studies why we make certain decisions about money. Let’s ask an economist what they think about…buying insurance!

 

DAMON JONES

My name is Damon Jones. I”m an associate professor at the University of Chicago, at the Harris School of Public Policy. I would say the first priority for insurance would be to protect yourself against catastrophic events. So these are things, if they happened, they would cost a lot of money to fix, maybe more money than you have in your savings account.This is like health insurance, insurance on your car if you own a car, homeowners and rental insurance. These are like, major events that if they happened, would put you in a major bind.So for very small things, there’s only a small chance that things are going to go wrong with those purchases. Most times they don’t. The way that insurance works, the person selling insurance, they make the most money when you buy insurance for something that’s not likely to really happen. So usually when someone is trying very hard to sell you insurance, they probably think they’re going to profit off of that. So they probably think, this isn’t really going to happen, but if you buy that insurance I can make some money and keep that money. I’m probably not going to have to pay out as much. When I buy like a flight, when I’m about to check out, they have a big sign that’s like “do you want to buy insurance? It’s only like 8 dollars, it’s only like $10 dollars” and I say “no” and they’re like, “are you sure?” That’s usually a bad sign. There’s no right or wrong answer with insurance. It depends on what makes you feel safe. But there are some cases where we tend to over-purchase insurance and some of these small expenses are examples. 

 

AVRY: That was Damon Jones, an economist from the University of Chicago for this installment of…Let’s ask an economist!

 

(MUSIC: MUSICAL STING)

 

Part 3:

(SFX: WIND WHIRLS OUTSIDE, HAMMERING INSIDE)

 

(SFX: SITCOM LAUGHTER)

 

RAY ROMANO: Awwww, Deborah! Bad news. My parents are coming over for dinner… again.

 

DEBORAH: Oh, Ray.

 

BRIDGET: Well, a few weeks have passed and it sounds like Ryan’s arm is doing better because he’s been watching Everybody Loves Raymond and hammering all morning. (TO RYAN) Ryan, what are you doing?

 

RYAN: Today’s weather report says that tonight, it’s gonna be “raining men.”

 

BRIDGET: Wait. Was this “weather report” maybe sung? Like to the beat of a disco song?

 

RYAN: Now that you mention it… this particular forecast was kind of disco-y.. Still, not taking any chances.

 

(SFX: HAMMERING)

 

RYAN: So, what did we learn about insurance from all this? I broke my arm for this, so what you say right now better be worth it, no pressure.

 

BRIDGET: As much as we might like to, we can’t plan ahead for every disaster that might happen in life. Insurance is supposed to help pay when those disasters are really expensive. . Someone agrees to take on your risk…for a price. The riskier your situation is   the more expensive your insurance is going to be.

 

RYAN: It sure does give you a lot to think about though. Insurance is supposed to help us out, but what happens when it doesn’t work the way we expect it to? And who’s really responsible for making sure we’re all able to protect ourselves from these big expensive risks? What if you can’t afford insurance? It’s a flawed system that’s still really important to have. And also, what DO your parents REALLY do at their jobs?

 

BRIDGET: Those are some really good questions, Ryan.

 

RYAN: You’re telling me and my broken arm! So while we wait for health insurance to become a better system, maybe laughter is the best medicine of all- which is why I always end the day with Raymond and his wacky family.

 

RAYMOND: (ON TV): Oh no, Deborah! My dad wants to use the bathroom!

 

DEBORAH: Oh Ray!

 

(SFX: SITCOM AUDIENCE LAUGHS)

 

RYAN: Hahahahaah!

 

–Theme Music– 

BRIDGET: Wow,  thanks for listening to this episode of Million Bazillion. Next time we’re going to answer the question, “Why do different countries use different currencies??” And we can’t wait to tell you the answer!

 

RYAN: Ooh, yes! But if you want to know more about insurance, check out the tip sheet for this episode at our website, Marketplace.org/million. While you’re there, you can also sign up for our newsletter so those tip sheets and new episodes come straight to your email inbox!

 

BRIDGET: Special thanks to the smart folks who helped us figure out how to answer Archer’s question: Archer’s Dad, Ash. Professor Hannah Farber, from Columbia University. Damon Jones from the University of Chicago. Caitlin Donovan, Director of the National Patient Advocate Foundation. And thanks to our friends at Marketplace for their help too!

 

RYAN: Million Bazillion is brought to you by Marketplace, and American Public Media. This episode was written and hosted by (me) Ryan Perez. Bridget Bodnar is the senior producer and co-host.

 

BRIDGET.: Voicing in this episode came from: Kimberly Adams, Peter Balonon-Rosen, Drew Jostad, Francesca Levy, Mel Rosenberg, and Marisella! Million Bazillion’s producer is Marissa Cabrera. Jasmine Romero is our editor. Our sound designer and mixing engineer for this episode was Bekah Wineman.

 

RYAN: The director of podcasts at Marketplace is Bridget.  Francesca Levy is the Executive Director of Digital. Neal Scarbrough is the VP and General Manager.

 

BRIDGET: Million Bazillion is funded in part by the Sy Syms Foundation, partnering with organizations and people working for a better and more just future since 1985. And special thanks to The Ranzetta Family Charitable Fund and Next Gen Personal Finance for providing the start-up funding for this podcast, and continuing to support Marketplace in our work to make younger audiences smarter about the economy.

 

RYAN: If Million Bazillion is helping your family have important conversations about money, consider making a one-time donation today at marketplace.org/givemillion, and thanks for your support.

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