Littering or Service?

Recently I received a little present at my doorstep: a brand-spankin’-new copy of the yellow pages.


Now, 15 years ago, this would have been rather useful. I would have been happy to receive the latest copy with all the updated contact info for the local business. However, in year 2013, I really don’t know what do with these pounds of paper. Maybe use it as a doorstop? Or keep around for next bonfire on the beach? I could also just ignore it and leave it there for a few weeks like some of my neighbors did..

I went for the “environmental” choice, and just dropped it into a recycle bin. What a waste of paper, and labor & energy to make it and distribute it.

Anyway, this got me thinking – could I report this as an instance of littering? Going by the book (or Wikipedia to be exact), “Litter consists of waste products that have been disposed improperly, without consent, in an inappropriate location.” Maybe I’m stretching the definition here.. but to me that pile of paper was no different than someone dumping a bag of garbage at my door..  In fact, the delivery man rang me, asking to be let into the apartment complex.. and I politely declined, stating that I do not need a phone book.

Anyway, I just wish marketers and the like stopped wasting paper on advertising (which the phone book really is) that just ends up in a trash can.

Saving on Auto Insurance

Every time I hear one of those Insurance ads claiming “people who switch to [..] on average save $x” I chuckle a little bit. Of course that people that do switch insurers save money – that’s why most people switch in first place! The statistic they provide is useless to most people, as you have no idea what your actual saving, if any, would be. What they’re telling you is that of all those people that get a quote from them, some (maybe a majority, maybe a small minority) will switch insurers, and on average save x amount of money. The only valuable piece of information that a consumer is getting here is that shopping around, be it for insurance or any other service or product, is usually a good idea, and you may find a cheaper provider.

I just find it funny how numbers are used in advertising to suggest things. The message that they are trying to imply is that if YOU switch to THEIR company, YOU will save money. Now, they can’t say this outright, as there will be some percentage of folks who won’t save by switching. What would be useful is if they provided a statistic, saying “20% of folks who call us switch, and save $400 on average”. Now I know that my expected “ROI” for calling them to get a quote, and spending 10-15 minutes with their agent is 20% x $400 = $80 / year. Assuming I don’t earn more than $320 / hour, this is now a valuable use of my time (for simplicity, I’m ignoring future years’ savings). However, if only 5% of people save the quoted amount, and I expect to spend 30 minutes for the quote, my expected ROI is only $20 / year – so $40 / hour of my time, ignoring future years’ savings. Not bad, especially if you assume future year savings, but not nearly as attractive as the first scenario.

Now, while the premium paid is likely the top concern to most folks when choosing an insurance company, I am almost concerned switching to a lower cost provider. While there is no guarantee that a higher cost company will provide me with a better service or value, I am curious to know how they can afford to charge me less. Where is it that they’re saving money on? They could have better actuaries, or at least be able to better assess your “risk level”. That said, they could also be undervaluing your risk level, and giving you a break by mistake. (This works for the individual consumer, as long as it’s not a widespread problem which would cause the insurer to default.) What I’m concerned with thought is that you just may be getting a worse value – and get short changed when an accident happens. How will the insurer treat you when you need them is just as important as what you pay upfront!