Insurance is the last bastion of the drunken lunch.
Fleet St and the Lord Mayors coach.
The marketing and regulatory costs of insurance are often greater than the cost of the cover. In addition, the government takes its cut (7.5%) in the form of insurance premium tax.
Multiple levels of regulation add more costs and finally we have the structure of the industry itself.
In a perfect market insurance would become a commodity bought only on price. This has happened in the home electricity market where the better informed customer no longer cares where his power comes from provided it is cheap. It will happen one day in insurance too- but the industry has been successful in resisting it so far.
Mature industries tend to accumulate layers of cost over time. One UK example is the Worshipful Company of Insurers who are one of the livery companies of the City. This is a trade association cum medieval guild that does much of the government of the City. These people spend their evenings feasting and holding banquets and their days doing good works while wearing silly hats. All harmless, worthy stuff, but is it really what you thought you were buying with your premiums?
It is also fairly quick and easy to get ones money back if needed.