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8.3 IS TELEPHONE "LINE GUARD INSURANCE" WORTH WHILE? -FINANCIAL MATH, SIMPLE
MATHEMATICS, EXAMPLES FOR PERSONAL FINANCES
If
you do not have insurance from your local phone company for the lines inside your house,
the company can charge you a basic $45 fee just to show up, plus $15 for every 15 minutes
they work on your line.
"Line
guard insurance" offered by your phone company costs a mere $4 a month (per
line).
Question:
If you need to call the phone company once in two years and the service call takes 30
minutes, which would be cheaper, the insurance costs or the uncovered visit?
Line
guard insurance = $4 X 12 months X 2 years = $96
Half-hour
service call = $45 + $30 = $75
In
this example, an uncovered service call would cost $21 less than paying the monthly
insurance.
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