This can apply to any type of insurance. If you can self-insure and you don’t need that money for something else, then you’d just be wasting your money by having the insurance. But I’d be certain that the money I have set aside is only for the self-insurance. If your counting on your retirement assets to cover the cost of replacing your home, what would you live on after rebuilding your home? The assets you count for self-insurance should be over and above your other needs, though there are some exceptions to this rule (like when you’re looking at long-term care insurance). I could take an entire article to explore that issue though, so we’ll have to wait until I get to it.