I’ll just go cancel my universal health care now.
UsernameHere@lemmings.world 10 months ago
For an insurance company to exist it has to spend less covering claims than it collects in payments.
Otherwise they end up bankrupt.
If you got back every dollar you spent on insurance, there would be nothing left over to spend on staff or any other part of their business.
This means anyone with insurance is better off taking their payments and saving it for when they need something covered.
Insurance is a scam.
eclipse@lemmy.world 10 months ago
UsernameHere@lemmings.world 10 months ago
Why?
eclipse@lemmy.world 10 months ago
Insurance is a scam
UsernameHere@lemmings.world 10 months ago
And universal health care isn’t insurance so I’m not sure what you’re trying to say.
howrar@lemmy.ca 10 months ago
If you consider only the mean, then of course you’re going to be better off without insurance on average. But most of us don’t care about the mean. We care about the variance. And when you buy insurance, you’re reducing the variance in your life in exchange for a lower mean. The problem with insurance isn’t insurance itself, but that often you pay and get nothing in return.
notapantsday@feddit.de 10 months ago
You’re generally correct. Insurances are a bad investment from a purely financial standpoint. Never get an insurance to save money or to avoid cost. Don’t get insurance for things that you can easily pay for from your savings or for things you can do without. For example, don’t get insurance for your flagship smartphone. Even if you can’t afford the same model again if it breaks, you can always get an entry-level or used phone for a fraction of the price which will do fine for daily tasks until you have saved up enough money.
But there are cases where losing money is just part of the problem. For example, health insurance can literally save your life by paying for a treatment you otherwise couldn’t afford. Or personal liability insurance - if you cause more damage than you can afford to pay for, you can lose your house and pretty much the kind of life you may have lived up to that point. On the other hand, if you’re already broke, living in a shitty apartment and hardly own anything of value, then there’s no point getting that insurance.
UsernameHere@lemmings.world 10 months ago
I realize that there are situations where insurance can be beneficial.
I’m just sharing what I’ve learned from working as a claims adjuster. The company I worked for created incentives for denying claims. Customers were often lied to about what is covered by the person selling the insurance. We often shared technicalities that were found in the contract that allowed us to deny more claims.
This did not only happen at the company I worked for. It is common practice in the insurance industry.
notapantsday@feddit.de 10 months ago
No argument here. I recently talked to someone who works for an insurance company and he said it feels like working for the mafia.
Bongles@lemm.ee 10 months ago
You know I used to process claims at a health insurance company in the US and while the general public consensus is that they hate that company, I’ve never seen the really scummy things people mention online about insurance. There were never incentives to deny claims or find loopholes or whatever. They just had the benefits listed, and various guidelines written out and you were just supposed to accurately process it to those guidelines, deny or pay, whatever.
I’m sure it happens, and there endless other issues, but it makes me wonder what company would risk that stuff if the one I was at didn’t.
driving_crooner@lemmy.eco.br 10 months ago
Insurance companies, specially life, usually have claim ratios (claims/premiums) of over 100% without problems, because they earn more money on investing the premiums over time that on the premiums itself.
UsernameHere@lemmings.world 10 months ago
I’ve worked as a claims adjuster. It was my job to find ways to deny claims so that my employer could make more profit. My employer was very clear about that.
Even if the insurance company is profitable, they will always want more.
Publicly traded insurance companies have an obligation to their shareholders to make larger profits year over year. The shareholders never say “we’ve made enough profit on investing, we dont need more profit”.
shootwhatsmyname@lemm.ee 10 months ago
Well, it really depends on the risk of what you’re doing. Some things could really quickly get you into millions of $$$ in legal fees and other expenses for a tiny slip up, and it would be really stupid not to have some sort of backup plan to cover yourself.
twack@lemmy.world 10 months ago
Yes, but car, home (or renters), and health insurance are required for the average person because all of those have a reasonable chance of absolutely bankrupting a regular person for life at any moment.
The alternative is to pay more taxes and have the government provide the insurance, which may or may not be better. There are pros and cons to both.
Either way though, you need the safety net that insurance provides.
RvTV95XBeo@sh.itjust.works 10 months ago
Yeah, the “insurance is a scam, just pocket the money, bro” folks really don’t understand just how royally fucked someone would be if their house burned down. Sure it’s a long shot, but me saving the $1k or so I spend each year on homeowners insurance is not going to cover me when there’s $300k in structural damage I have to deal with.
UsernameHere@lemmings.world 10 months ago
When I was a kid my dads house caught on fire. The fire was caused by old wiring so the insurance claim was denied.
They weren’t worried about verifying the condition of the wiring when they were collecting my dad’s insurance payments. And they didn’t return the money he paid into it after denying the claim. So we ended up homeless even after my father had spent all that money on insurance to prevent it.
If he had all those insurance payments in a bank account we could’ve at least afforded a hotel or apartment while we figured out what to do.
UsernameHere@lemmings.world 10 months ago
I’m aware some insurance is required by law.
Considering publicly traded insurance companies need to make larger profit margins than their previous year. Every year. And the government doesn’t. It’s safe to say the insurance company will deny more claims and you will get less and less than what you pay into it over time.
Either way everyone is better off saving that money so they can actually use it if they need it.
spacecowboy@sh.itjust.works 10 months ago
Do not listen to this person’s advice.