Maybe you've watched Formula 1 on TV, seen a dramatic crash, and thought, "My insurance would be through the roof if I did that!"
But wait, do F1 drivers even carry car insurance?
The answer is, well, kind of. In a sport that pushes body and machine to their absolute limits, insurance doesn't look like anything you or I might buy for our cars.
1. Insurance Doesn't Cover The Races
While we have to Google questions like "how much is car insurance in AZ" when we move house, you won't find Fernando Alonso desperately trying to find the best rates in Miami before the Grand Prix.
The weird thing is that F1 insurance doesn't cover collisions at races.
This may seem odd, but the odds of any one car getting damaged are so high that no insurer wants to take the risk. It's the same reason that people with poor driving records may struggle to find insurance.
What is an F1 car insured for, then? The cars and equipment are insured for travel from one event to another and against events outside the team's control, including weather damage, theft, or vandalism. This is known as comprehensive coverage in the insurance biz, and you will likely have it in your own coverage.
Comprehensive coverage is cheaper on an F1 car than when you or I buy it. This is because cars are well-secured when shipped and are rarely left unattended or unobserved. This keeps the risk to the insurance company low.
Teams don't go through a company with a catchy commercial jingle, either. There are insurers that specialize in auto racing and other dangerous sports.
2. Insurance Is More For The Spectators Than The Crew
What about medical risks to the driver? Drivers generally pay for their own personal injury coverage. Costs can reach the high-six figures a month for these policies – the risks are very high in F1, although as Lewis Hamilton recently admitted, sometimes everyday roads feel more dangerous.
Drivers generally cover their own life insurance premiums, which can be costly. With drivers switching teams, it's easier for them to cover their own health and life insurance.
Racing teams take out coverage to cover pit crews, who are also generally covered by the insurance event organizers take out.
F1 teams do have what's called liability insurance, though. This covers the event where a crash injures or kills a spectator. The teams are protected from criminal liability in the event of a crash like this, but they can still be sued for damages.
3. Teams Can Get Screwed Paying For Accidents
Teams generally pay for the damage to their own cars, even if the damage is the fault of another driver. The team's budget cap includes damage, so teams have to be careful not to spend too much at the beginning of the season.
This can be pretty expensive, as a tire on a Formula 1 car costs at least $600 per tire, and the suspension can be as much as $150,000. It's easy for a crash to result in millions of dollars of damage to just one car.
Occasionally, team managers complain about the unfairness of paying for a crash that wasn't their fault, but this system seems set to continue in the near future.
Sometimes, It's Better To Be A Fan Than A Driver
Concerns are different at the top of the game. F1 drivers don't carry car insurance because of how often they crash and how severe the injury risk is. Maybe it's better to live in the real world, with boring car insurance bills and all.
