I wonder how many more overt measures that can be easily interpreted as pro-surveillance pro-advertising need google take, before the masses turn to alternatives like cyanogenmod etc.
"So yes, the bond holders got a raw deal, but lots of people got a raw deal during the meltdown of 2008."
That does not mean that normal bankruptcy law is appropriately abridged just for one group of beneficiaries. The feds didn't change the law - they just bullied secured bondholders into accepting a lot less than they were entitled to (from a selloff of the assets). It's a horrible precedent.
OK, if you're pedantic, call it a "mutual fund, mashed together with insurance and other financial products". But the fact that multiple products are sold to you in a tied package says nothing about the insurance component of the business. Even the fact that insurance companies try to invest the "float" etc. to maximize their income says nothing about the insurance component of the business.
You're using "expected" in a uselessly fuzzy and different way throughout, confusing "hoping" or "worrying about" and "average". The mathematical way, the quantitative way, is related to probability & money, and that is the language of business. You're also using "value" in a uselessly fuzzy and different way throughout, confusing dollars and feelings of enjoyment.
"But as you despised all subjective looks,"
Stop putting words in my mouth.
Do you have a succinct proposition you'd like to discuss?
I did no such thing. I simply pointed out that transactions ultimately occur in terms of dollars, so the participants have to translate their subjective values to objective quantities at some point.
"It only makes sense to buy a financial product when either you get back more money than you paid,"
Really. Do explain lotteries, or equity options, or numerous other financial products without a guaranteed positive return.
Similarly, in the case of insurance, if a covered peril occurs, you probably would likely get back more money than you personally paid. That changes nothing about the averages for a competently run run risk pool.
In every single dollar they pay (on average more) as premiums and receive (on average less) in benefits.
I'm sorry, are you putting me on? Would you seriously ask "where is nice objective dollars" in "having a good meal" or "wearing a comfy pair of shoes"?
Context, please, context. The quoted words were referring to your way of explaining how much more valuable money is to a sufferer. That way of looking at the problem is not worth much: it is qualitative, subjective, and vague.
But that's ok, people can value things in qualitative, subjective, and vague ways, as long as at the end of they day, they transact in nice objective dollars.
"why does it make sense to buy insurance when it necessarily involves a statistical certainty of economic loss"
This is kind of elementary. Most people rest easier, knowing that in the case of a problem, they will have $X with near-100% probability, rather than $savings with questionable probability. That comfort is worth the statistical overpayment.
"And why would you overpay for avoiding catastrophic loss?"
If you mean "overpay" in the sense of pay slightly more in premiums than your risk (probability of peril * cost of peril), then you do that because you must: no insurance company would willingly offer you a deal on which it is expecting to lose (on average).
On average, aggregated across the homogeneous risk pool, indeed every participant loses. But that's OK - the point of insurance is not to win on average. It's to avoid catastrophic loss in an unlikely situation - if you win a bad-news lottery.
An economical insurance scheme will cost participants a little net loss on average. An obamacare-distorted "insurance" will cost many participants a big net loss on average, and give many other participants a big net gain on average. On purpose, as a welfare cause.
"Without this subjective look, it is always foolish to get insurance (unless mandated by law, of course) . Is that your statement?"
Of course not. You introduced the concept of insurance benefit payment dollars being worth more than a dollar each. That might make emotional sense for a moment to a sufferer, but makes no economic sense at all.
"you buy plan A and I buy plan B, does not mean that my money will never go to you and your money will never go to me"
That's just incidental intermingling at the level of administration, not at the level of actuarial cost / benefit. If an insurance company were to host multiple plans, and puts in a fix into plan A to be slightly unprofitable but plan B to be slightly more profitable, the suckers in B would go to a competitor.
"That means [as an insurance company, you] WANT healthy people to pay into the system explicitly so their contributions can offset the costs of the sick people making claims against their policies."
Of course, But this desire is limited by competitive pressure, wherein another insurance company who's not trying to screw the claim-free customers can charge them less (in a risk pool dedicated to people like themselves). Guess what has just been outlawed...
"But since the payouts go to those who likely value the dollar more, total value of insurance is positive."
I don't know if such a subjective look is worth much. By that definition, anyone who's receiving a claim payout is getting $B need-dollars for $P premium-dollars. If anything, it may encourage people to over-insure (get overly large life/etc. insurance befits), which raises their premiums.
An insurance company must ensure that the total premiums exceed total claims - for its livelihood, but must also ensure that premiums are as low as possible while corresponding to risks - for competitive reasons. Or at least, they had to, until obamacare smashed that bit of feedback.
"Insurance is ALL about spreading the risk. Over the population and over time."
You're forgetting the all-important homogeneity of the risk pool (over the life of a contract, usually a year or few -- not a lifetime!). Different risk pools naturally get different premiums/benefits, at whatever level of granularity the marketplace can offer. Guess what industry was just stopped from being such a marketplace (web site nicknames notwithstanding).
"An Insurance plan is intended to insure that you have an organized way of putting aside money, that it will be invested by the insurer to permit the insurer to be able to make a profit on that money (and maybe even return some of it), and finally, to deliver if and when you need the money."
No, an insurance policy is not a savings vehicle. Even life insurance isn't, since the actuarial premiums on average are in excess of the expected payments + investment returns (all numbers suitably discounted), or else an insurance company couldn't exist as a going concern.
You might like reading Warren Buffet's annual note to his BRK investors. He gives a basic introduction to the concept of insurance, which you appear to sorely need.
"I think everyone who understand what insurance actually is understands - at least implicitly - that they are subsidizing someone else. These people also understand that if they end up needing help, then others will be subsidizing them."
No, and this is a common and tragic misunderstanding.
Insurance is not designed for systematic subsidizing others of different risk profiles. It's not supposed to subsidize anyone on average at all. Yes, a single instance of covered peril will end up pulling money from other similar subscribers, but on average, in fact, everyone must lose.
Whereas when the "risk pools" are forcibly intermingled by law, the low-risk people are systematically exploited to pay for the high-risk ones. What Medicaid, Social Security etc. have in common with obamacare is that they are also not "insurance" but wealth transfer.
"Do you think the sick and elderly - the ones who benefit most from healthcare - aren't worth taking care of by having healthy individuals pay into insurance coffers?"
Well, be that as it may. By forcing the young & healthy into a single risk pool with the old & sick, "insurance" is thrown out the window and you have welfare / cross-subsidizing. Whether that's acceptable to you is one thing. Whether that's how the scheme was sold to the public is quite another.
"will weep for you as the $95 fine is "forcibly extracted" from your bank account."
That's for year 1. It escalates from there.
"That is, if you don't have a brain, and don't get insurance. Or get insurance already through your employer."
A young/healthy one who has a brain would not eagerly nor voluntarily overpay in the new "insurance" (in reality, generational wealth-transfer) scheme.
Slashdot Mirror
"When conservatives tell me it's "politically correct nonsense", that to me is a denial of my identity."
If you choose to tie up your identity in politically correct nonsense, sorry, you're bringing it on yourself.
I wonder how many more overt measures that can be easily interpreted as pro-surveillance pro-advertising need google take, before the masses turn to alternatives like cyanogenmod etc.
"So yes, the bond holders got a raw deal, but lots of people got a raw deal during the meltdown of 2008."
That does not mean that normal bankruptcy law is appropriately abridged just for one group of beneficiaries. The feds didn't change the law - they just bullied secured bondholders into accepting a lot less than they were entitled to (from a selloff of the assets). It's a horrible precedent.
OK, if you're pedantic, call it a "mutual fund, mashed together with insurance and other financial products". But the fact that multiple products are sold to you in a tied package says nothing about the insurance component of the business. Even the fact that insurance companies try to invest the "float" etc. to maximize their income says nothing about the insurance component of the business.
Don't worry, in the next scene, our heroes find a doctor in the back, along with a jive lady, and another pilot with a drinking problem.
That's OK too. Shrink 'em down to the constitutional essentials.
Fishing for an Ig Nobel Prize perhaps, good luck!
"Ok, I apologize profusely."
Accepted.
"I thought you had some idea what you are talking about."
You were right.
You're using "expected" in a uselessly fuzzy and different way throughout, confusing "hoping" or "worrying about" and "average". The mathematical way, the quantitative way, is related to probability & money, and that is the language of business. You're also using "value" in a uselessly fuzzy and different way throughout, confusing dollars and feelings of enjoyment.
"But as you despised all subjective looks,"
Stop putting words in my mouth.
Do you have a succinct proposition you'd like to discuss?
"But as you despised all subjective looks"
I did no such thing. I simply pointed out that transactions ultimately occur in terms of dollars, so the participants have to translate their subjective values to objective quantities at some point.
"It only makes sense to buy a financial product when either you get back more money than you paid,"
Really. Do explain lotteries, or equity options, or numerous other financial products without a guaranteed positive return.
Similarly, in the case of insurance, if a covered peril occurs, you probably would likely get back more money than you personally paid. That changes nothing about the averages for a competently run run risk pool.
In every single dollar they pay (on average more) as premiums and receive (on average less) in benefits.
I'm sorry, are you putting me on? Would you seriously ask "where is nice objective dollars" in "having a good meal" or "wearing a comfy pair of shoes"?
Context, please, context. The quoted words were referring to your way of explaining how much more valuable money is to a sufferer. That way of looking at the problem is not worth much: it is qualitative, subjective, and vague.
But that's ok, people can value things in qualitative, subjective, and vague ways, as long as at the end of they day, they transact in nice objective dollars.
I'm sorry, I don't know what you're trying to say. I already belaboured the obvious and the inobvious.
"why does it make sense to buy insurance when it necessarily involves a statistical certainty of economic loss"
This is kind of elementary. Most people rest easier, knowing that in the case of a problem, they will have $X with near-100% probability, rather than $savings with questionable probability. That comfort is worth the statistical overpayment.
"And why would you overpay for avoiding catastrophic loss?"
If you mean "overpay" in the sense of pay slightly more in premiums than your risk (probability of peril * cost of peril), then you do that because you must: no insurance company would willingly offer you a deal on which it is expecting to lose (on average).
On average, aggregated across the homogeneous risk pool, indeed every participant loses. But that's OK - the point of insurance is not to win on average. It's to avoid catastrophic loss in an unlikely situation - if you win a bad-news lottery.
An economical insurance scheme will cost participants a little net loss on average. An obamacare-distorted "insurance" will cost many participants a big net loss on average, and give many other participants a big net gain on average. On purpose, as a welfare cause.
"Without this subjective look, it is always foolish to get insurance (unless mandated by law, of course) . Is that your statement?"
Of course not. You introduced the concept of insurance benefit payment dollars being worth more than a dollar each. That might make emotional sense for a moment to a sufferer, but makes no economic sense at all.
"you buy plan A and I buy plan B, does not mean that my money will never go to you and your money will never go to me"
That's just incidental intermingling at the level of administration, not at the level of actuarial cost / benefit. If an insurance company were to host multiple plans, and puts in a fix into plan A to be slightly unprofitable but plan B to be slightly more profitable, the suckers in B would go to a competitor.
"That means [as an insurance company, you] WANT healthy people to pay into the system explicitly so their contributions can offset the costs of the sick people making claims against their policies."
Of course, But this desire is limited by competitive pressure, wherein another insurance company who's not trying to screw the claim-free customers can charge them less (in a risk pool dedicated to people like themselves). Guess what has just been outlawed...
"But since the payouts go to those who likely value the dollar more, total value of insurance is positive."
I don't know if such a subjective look is worth much. By that definition, anyone who's receiving a claim payout is getting $B need-dollars for $P premium-dollars. If anything, it may encourage people to over-insure (get overly large life/etc. insurance befits), which raises their premiums.
An insurance company must ensure that the total premiums exceed total claims - for its livelihood, but must also ensure that premiums are as low as possible while corresponding to risks - for competitive reasons. Or at least, they had to, until obamacare smashed that bit of feedback.
"I'll remember that as I cash my next quarterly insurance dividend."
Then you have a mutual fund, not insurance. Congratulations (?).
"Insurance is ALL about spreading the risk. Over the population and over time."
You're forgetting the all-important homogeneity of the risk pool (over the life of a contract, usually a year or few -- not a lifetime!). Different risk pools naturally get different premiums/benefits, at whatever level of granularity the marketplace can offer. Guess what industry was just stopped from being such a marketplace (web site nicknames notwithstanding).
"An Insurance plan is intended to insure that you have an organized way of putting aside money, that it will be invested by the insurer to permit the insurer to be able to make a profit on that money (and maybe even return some of it), and finally, to deliver if and when you need the money."
No, an insurance policy is not a savings vehicle. Even life insurance isn't, since the actuarial premiums on average are in excess of the expected payments + investment returns (all numbers suitably discounted), or else an insurance company couldn't exist as a going concern.
You might like reading Warren Buffet's annual note to his BRK investors. He gives a basic introduction to the concept of insurance, which you appear to sorely need.
"I think everyone who understand what insurance actually is understands - at least implicitly - that they are subsidizing someone else. These people also understand that if they end up needing help, then others will be subsidizing them."
No, and this is a common and tragic misunderstanding.
Insurance is not designed for systematic subsidizing others of different risk profiles. It's not supposed to subsidize anyone on average at all. Yes, a single instance of covered peril will end up pulling money from other similar subscribers, but on average, in fact, everyone must lose.
Whereas when the "risk pools" are forcibly intermingled by law, the low-risk people are systematically exploited to pay for the high-risk ones. What Medicaid, Social Security etc. have in common with obamacare is that they are also not "insurance" but wealth transfer.
"Do you think the sick and elderly - the ones who benefit most from healthcare - aren't worth taking care of by having healthy individuals pay into insurance coffers?"
Well, be that as it may. By forcing the young & healthy into a single risk pool with the old & sick, "insurance" is thrown out the window and you have welfare / cross-subsidizing. Whether that's acceptable to you is one thing. Whether that's how the scheme was sold to the public is quite another.
"will weep for you as the $95 fine is "forcibly extracted" from your bank account."
That's for year 1. It escalates from there.
"That is, if you don't have a brain, and don't get insurance. Or get insurance already through your employer."
A young/healthy one who has a brain would not eagerly nor voluntarily overpay in the new "insurance" (in reality, generational wealth-transfer) scheme.
You're confusing the government (taxation) and private companies (voluntary purchase).