> In insurance you expect to come out ahead in the average case.
Not financially, no. On average people who buy insurance receive less in payouts than they pay in in premiums. If that were not the case, nobody would sell insurance because anyone who tried to would go bankrupt.
If you factor in the non-financial benefit of risk avoidance, then yes, people who buy insurance come out ahead--but now not just in the average case, but in all cases, at least as long as the people buying insurance are rational and only buy the amount of risk avoidance they actually need.
Insurance is not about coming out ahead on the average case. In fact, it's the insurance company that comes out ahead when you average everything (otherwise they wouldn't be a business). You pay for insurance to come out ahead of (or equal to) the 40th(-ish) percentile cases.
Yes, you are, if you can't “afford” the loss. And this does not mean that loosing the car bankrupts you.
It just means that reimbursing you for your loss is worth more to you than the insurance company, because it's harder for you to recover form a (e.g.) $10k loss than for the insurance company.
When priced correctly, and depending on your wealth, on average insurance can be a win-win (i.e. profitable) transaction for both parties. That's why it's economically useful.
In gambling you expect to come out behind in the average case.
Therefore insurance is rational and gambling is irrational.