CDR: Re: why should it be trusted?

[Riad S. Wahby]

Nathan Saper <natedog at well.com> wrote:
> Close.  I am arguing that insurance companies shouldn't be allowed to
> deny coverage based upon factors that the insuree does not have
> control over.  For example, I smoke, so I really can't blame an
> insurance company for charging me extra, because that's a factor I
> have control over.

The fact that it's not the insuree's fault does _not_ mean that it's
the insurer's fault.  Said another way, the insurance company has no
additional responsibility to (WLOG) me because I have a genetic
defect.  However, you're proposing that the insurance company endeavor
to waste money on those who are known to be "losers" as far as
insurance goes.  You as a smoker should be the most outraged in such a
situation; the strict standards that keep you from getting insurance
at a good rate do not apply to me because my elevated risk for
e.g. heart disease has a different source.

It's not the cause of the risk that concerns the insurance companies,
it's the existance of the risk.  That's all they need judge upon, and
any interference by the government saying otherwise is an unreasonable
burden on private enterprise.

> Fine.  I'll try to find some numbers.  I don't have any off the top of
> my head, though.  It just seems that because A) the insurance
> companies make good profits and B) the number of people denied
> coverage based upon genetic abnormalities is fairly small, it wouldn't
> affect them too much.

"It won't hurt them _that_much_ to lose a little money on these
people; thus, they should be forced to do so."  Preposterous.

> Coverage is most often less expensive than care.  Therefore, one may
> be able to afford the coverage, but not afford the care, if it ends up
> being required.

Still not the insurance company's fault.  They're not there to save my
sorry, genetically defective ass, they're there to make money.

> Isn't this the whole idea of insurance?  You pay them x dollars, and
> if you end up getting sick, they most likely have to pay more than x
> dollars to treat you.  The insurers are banking on the fact that the
> majority of the people who have insurance don't get sick.

Right.  And if they're forced to insure people who are money sinks for
them, everyone's rates go up, because the total amount of risk the
insurance company takes (expressed as the amount of money they pay out
as claims) plus their profit must equal the amount of money they make
on premiums.

--
Riad Wahby
rsw at mit.edu
MIT VI-2/A 2002

5105
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