submitted 1 day ago* (last edited 1 day ago) by to c/world@lemmy.world
you are viewing a single comment's thread
view the rest of the comments
[–] 28 points 21 hours ago* (8 children)

No insurance is risk distribution. We all pay 5$ so none of us needs to pay 5,000,000$ which is not economically sustainable. What insurance companies get is administrative overhead fee. This has nothing to do with gambling.

  • source
  • parent
  • hideshow 8 child comments
  • [–] 1 point 10 hours ago (2 children)

    The price of an insurance product is divided in 4 parts, the risk, the actuarial adjustment, administrative and distribution costs, and return of capital.

  • source
  • parent
  • hideshow 2 child comments
  • [–] 1 point 9 hours ago (1 child)

    Aren't the risk and the actuarial adjustment the same thing?

  • source
  • parent
  • hideshow 1 child comment
  • [–] 1 point 6 hours ago

    No, the risk is the probability of a claim times the value of a claim. If you just charge that is mathematically proven that the insurance pool is going to fail. The actuarial adjustment is there to create a surplus that guarantee the survival of the pool.

  • source
  • parent
  • [–] 4 points 14 hours ago* (3 children)

    Nah nah nah; Insurance is like preem gammbling.

    For example insurance companies couldn't pay everyone back after Hurrican Katrina. First come first serve I guess. :P

    To my understanding insurance companies isolate areas so if that area gets hit hard. The insurance company just files bankruptcy in the area and moves on..

    You gamble with which bookie (insurance company) you choose. You gamble when you choose where to live. You gamble how fast you can make your insurance claim. This shit is gambling through and through. And we ("The Common Person") are getting fleeced.

  • source
  • parent
  • hideshow 3 child comments