Are Auto Club Memberships Like AAA Worth It?

Jeremy asks what Dave thinks about auto club memberships like AAA.

QUESTION: Jeremy asks what Dave thinks about auto club memberships like AAA.

ANSWER: Truthfully, I generally self-insure through that kind of thing. In other words, AAA is towing insurance and insurance that covers miscellaneous other roadside needs and other travel planning needs and those kinds of things. I just don’t personally have the need for those things.

The number of times I have used a tow truck in 20 years is two, maybe. They came to my house and got a car that wouldn’t start or something. I mean, it’s just nothing. I haven’t used it. It wouldn’t be of use to me. I’m not a member. I’m not mad at them. I just look at stuff like that, and I wonder from a gimmick perspective if I don’t just take that risk myself, where does that leave me?

It basically is a type of insurance, if you will. Are you going to do that? So I’ve not endorsed it for that reason. I don’t think you’re getting completely ripped off. I don’t think it’s a horrid product or something like that, but I don’t buy it for me. That’s my reasoning. I guess if you were in a situation where you were going to use those services an awful lot . . . but then they would be losing money on you, and if that was their average customer, then they would lose money.

It’s a type of insurance that you probably should just self-insure through.