For one thing, insurance makes expenses more predictable; though the desire for predictability (in order to budget, or the like) does probably indicate irrationality and/or bounded rationality.
What's unpredictable about a loan? You can predict what you'll be paying pretty darn precisely, and there's no intrinsic reason that your monthly loan repayments would have to be higher than your insurance pre-payments.
To whom it may concern:
This thread is for the discussion of Less Wrong topics that have not appeared in recent posts. If a discussion gets unwieldy, celebrate by turning it into a top-level post.
(After the critical success of part II, and the strong box office sales of part III in spite of mixed reviews, will part IV finally see the June Open Thread jump the shark?)