You guys argue that people who have insurance should pay their premiums in proportion to how likely they are to use it. You consider that the fairest possible payment system. However, if you take that to its logical conclusion, you should only charge people who actually end up using it. So you should go ahead and eliminate insurance altogether, and you have the fairest model possible: only people who get into car accidents pay the costs, only people who get sick pay medical costs, only people who get robbed suffer their losses.
The entire point of insurance is to make the payment unfair in order to diminish the payment by spreading the risk among everyone. You agree to pay something, even though you hope to never have to cash in on the insurance, so that if you do have to cash in, everybody else who doesn't need to cash in subsidizes you, and you pay less.
The proper pricing model for insurance is based on percentage chance of using it. Do you have a 5% chance of using insurance? Then you should pay 5% plus profit margin in premiums.
Does someone who smokes have a higher chance of using insurance, and paying more for medical care? Yes? Ok, charge them more.
Does someone who has genes for issue X -- and lets say that they are active, expressed genes -- have a higher chance of using insurance and paying more for medical care? Yes? Ok, so ...
Now we get into the first set of tricky questions. You can choose to smoke or not. You can't choose your genes. Do we penalize people for some things that they cannot control?
And why did we look at gene X -- there are hundreds of thousands of issues with genes. Potentially, every protein that can fold in more than one shape, or that can be generated in multiple slightly variant sequences could turn out to affect disease -- yet we only have some of them analized. Does it make sense to say "We know you are worse because of X, we don't know about Y, so we're giving you penalty for X, but not giving you a discount for Y"?
And who decides to study X and not Y? Is there a correlation between european genes vs african genes? "Race is only skin deep" is false -- the people who migrated out of africa did get different genes as a result. Should we not give penalties to people who have lost the malaria protection in their blood?
That last question is deliberately loaded, deliberately phrased. If you didn't understand it: The same sickle cell that gives you protection against malaria from mosquitoes also causes anemia from a lack of oxygen in other situations. How do you tell what's the benefit or the penalty?
And I haven't even gotten to the statistical abuse of several "different" issues that actually overlap to the point that you are double- or triple- surcharging for what is really a single issue.
Insurance pricing is not nearly as clear-cut as people want to make it seem.
Simple example: Under the affordable health care act, the stated goal is to get enough young, healthy people signed up to cover the costs of insuring the elderly. So the stated goal is to have younger people overpay -- pay higher than the expected usage costs -- to reduce the costs charged to older people.
Fairness? Charging people less for being healthy? How do you determine healthy? How do you determine fairness? Why do you deliberately overcharge group A to subsidize group B? Why permit this on age? How do you prevent it from being racial in disguise as soon as you look at genes?
This topic was on privacy. So where's the line?
If I want my genes to be private, and out of the insurance company, why not?
If I want my actions to be private, and out of the insurance company, why not?
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Car insurance companies finally seem to have the right model. You can get a discount if you voluntarily reveal your driving habits, but you don't have to if you don't want to.
Now, all we need is what I understand to be existing conversion law. That data is provided to you only for the purpose of calculating my insurance, and any other use is in violation of the law.
