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Insurance is a Scam

Ren
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8/31/2010 10:56:44 AM
Posted: 6 years ago
My premise is that given insurance is essentially regular payments to a company in the interest of that company paying some, most, or all of the fees associated with unavoidable needs, there is nothing that distinguishes an insurance plan from a savings account, except that the insurance plan claims that it will render money despite how much money has been paid to the company. But, that payment comes with a threshold and almost always with a deductible. Accordingly, it is rare, if it ever happens, that an insurance company will pay more for a client than it has received from that client.

Thus, it essentially suggests that this society is structured in such a way that most people are not expected to make enough to accommodate their basic needs, lest such companies would not exist.

Furthermore, it suggests that those most capable of purchasing insurance could afford whatever the insurance would accommodate using an active savings account, suggesting that insurance is fraudulent in general. Even if someone with an active savings account to accommodate the entirety of an unexpected need, many bank provisions would render that moot, such as overdraft protection, credit, and loans.

Therefore, shouldn't there be a system whereby loans or credit is allocated for unexpected needs, rather than insurance scams?

Discuss.
Ren
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8/31/2010 10:58:59 AM
Posted: 6 years ago
Furthermore, it suggests that those most capable of purchasing insurance could afford whatever the insurance would accommodate using an active savings account, suggesting that insurance is fraudulent in general. Even if someone with an active savings account did not have enough in that account to accommodate the entirety of an unexpected need, many bank provisions would render that moot, such as overdraft protection, credit, and loans.
LaissezFaire
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8/31/2010 11:05:27 AM
Posted: 6 years ago
The idea behind insurance is to pool risks. Some people will need it, and some won't, but since no one knows which group they're in, they take the safe route and buy insurance. For a extremely simplified example, say 1 out of 1000 people will get cancer, which costs $100,000 to treat. An insurance company could just charge some amount higher than $100 per person. They would make a profit, and everyone would be protected against having to take a $100,000 loan, which would likely cause them to be stuck in debt for the rest of their life. Wouldn't you rather pay $100 than take the risk of having to pay back that huge loan?
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: At 6/22/2011 6:57:23 PM, el-badgero wrote:
: i didn't like [Obama]. he was the only black dude in moneygall yet he claimed to be home. obvious liar is obvious liar. i bet him and bin laden are bumfvcking right now.
lovelife
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8/31/2010 11:11:10 AM
Posted: 6 years ago
Not a scam its something that you invest in, hoping you wont need it, using it if you do. I may just be lucky but the deductable for the whole family is $200.
If we paid for all medical expeses we would easily end up paying $200,000 a year.
But yes its to pool money together and help support each other, not exactly a scam.
It would be a scam if you didn't get health benefits from it, or you had to keep paying beyond the deductable.
It would be a scam if it somehow lied, but to my knowlage insurance is not a scam (be it motor, health, musical instrument, home etc)
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PARADIGM_L0ST
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8/31/2010 11:51:42 AM
Posted: 6 years ago
Therefore, shouldn't there be a system whereby loans or credit is allocated for unexpected needs, rather than insurance scams?:

Uh, that is what insurance is... Unless you mean, should everyone have a "rainy day" account?
"Have you ever considered suicide? If not, please do." -- Mouthwash (to Inferno)
PARADIGM_L0ST
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8/31/2010 12:01:12 PM
Posted: 6 years ago
Therefore, shouldn't there be a system whereby loans or credit is allocated for unexpected needs, rather than insurance scams?:

Who would loan you the money and how exactly would you pay back that loan?

You: Hey, yeah, so I'm dying of cancer and am only expected to live for 2 more months. So, I was wondering if you'd hook it up. I can pay it back in 436 installments of $450.00 per month.

Creditor: But you're supposed to be dead in no more than two months, so how are you supposed to pay that back? What's our insurance that we will get our money back?

You: Just give me the f*ck!ng money, I'm dying over here!!!!
"Have you ever considered suicide? If not, please do." -- Mouthwash (to Inferno)
Ren
Posts: 7,102
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8/31/2010 1:17:15 PM
Posted: 6 years ago
At 8/31/2010 11:05:27 AM, LaissezFaire wrote:
The idea behind insurance is to pool risks. Some people will need it, and some won't, but since no one knows which group they're in, they take the safe route and buy insurance. For a extremely simplified example, say 1 out of 1000 people will get cancer, which costs $100,000 to treat. An insurance company could just charge some amount higher than $100 per person. They would make a profit, and everyone would be protected against having to take a $100,000 loan, which would likely cause them to be stuck in debt for the rest of their life. Wouldn't you rather pay $100 than take the risk of having to pay back that huge loan?

A cancer patient will have a hard time getting insurance if he or she does not already have insurance. Most insurance plans deny those with preexisting conditions. Most insurance plans do not cover the majority of terminal conditions.

A $100 for something that costs $100,000 is unheard of; doesn't exist.

Personally, I would rather save my money and supplement it with a loan or credit when needed.
Ren
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8/31/2010 1:23:23 PM
Posted: 6 years ago
At 8/31/2010 11:11:10 AM, lovelife wrote:
Not a scam its something that you invest in, hoping you wont need it, using it if you do. I may just be lucky but the deductable for the whole family is $200.

Is this for all possible conditions with no upper limit, to include preexisting conditions as well as prescriptions. I hiiiiighly doubt it.

Furthermore, if your family's deductible is $200, then your parents are paying that insurance company every single month for something that may never happen and will never see that money again. Then, they will still have to pay for most visits ($150-$200). Only in the case of a severe emergency will your parents still have to pay the deductible, and then whatever's left after the upper limit of their insurance plan has been reached (as all insurance plans have upper limits).

If we paid for all medical expeses we would easily end up paying $200,000 a year.

How do you figure that?!

Alternately, how much does your family pay for insurance?

But yes its to pool money together and help support each other, not exactly a scam.

Couldn't we do that without *spending* money every month?

It would be a scam if you didn't get health benefits from it, or you had to keep paying beyond the deductable.

You do. There are upper limits to all insurance plans. Furthermore, there is no guarantee that you will get help from an insurance company, but there is a guarantee that you will never see your money again. Sounds like a scam to me.

I mean, not even every hospital accepts all insurance plans and insurance plans do not cover all visits or conditions.

It would be a scam if it somehow lied, but to my knowlage insurance is not a scam (be it motor, health, musical instrument, home etc)

Motor insurance is the biggest scam of them all. Yikes. People pay an average $1000 a year for auto insurance. Most insurance claims are under $300. Most people do not have insurance claims more than once every two years. Those that do pay significantly more than $1000/year.
Ren
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8/31/2010 1:24:21 PM
Posted: 6 years ago
At 8/31/2010 11:51:42 AM, PARADIGM_L0ST wrote:
Therefore, shouldn't there be a system whereby loans or credit is allocated for unexpected needs, rather than insurance scams?:

Uh, that is what insurance is... Unless you mean, should everyone have a "rainy day" account?

Right, everyone should have a rainy day account, supplemented with credit and loans when necessary. I don't see why that isn't more viable than insurance, rendering insurance a scam, which is effectively spending money rather than saving it in hopes that you might get help when you need it.
Ren
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8/31/2010 1:25:25 PM
Posted: 6 years ago
At 8/31/2010 12:01:12 PM, PARADIGM_L0ST wrote:
Therefore, shouldn't there be a system whereby loans or credit is allocated for unexpected needs, rather than insurance scams?:

Who would loan you the money and how exactly would you pay back that loan?


People get loans all the time. You mean that it makes sense to you to get a car loan or an education loan, but not a health loan? Besides, loans should be last resorts. Credit would come first.

You: Hey, yeah, so I'm dying of cancer and am only expected to live for 2 more months. So, I was wondering if you'd hook it up. I can pay it back in 436 installments of $450.00 per month.

Creditor: But you're supposed to be dead in no more than two months, so how are you supposed to pay that back? What's our insurance that we will get our money back?

You: Just give me the f*ck!ng money, I'm dying over here!!!!

That sounds like a conversation between a cancer patient and an insurance agent, actually.
nonentity
Posts: 5,008
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8/31/2010 1:27:16 PM
Posted: 6 years ago
At 8/31/2010 1:24:21 PM, Ren wrote:
At 8/31/2010 11:51:42 AM, PARADIGM_L0ST wrote:
Therefore, shouldn't there be a system whereby loans or credit is allocated for unexpected needs, rather than insurance scams?:

Uh, that is what insurance is... Unless you mean, should everyone have a "rainy day" account?

Right, everyone should have a rainy day account, supplemented with credit and loans when necessary. I don't see why that isn't more viable than insurance, rendering insurance a scam, which is effectively spending money rather than saving it in hopes that you might get help when you need it.

Do you know how many people don't have any savings? Let's say I drive a Mercedes and some idiot t-bones me. If said idiot doesn't have insurance, how in the hell is he going to pay for the damages to my car plus the cost of my physiotherapy/etc.? Not everybody get get a loan...
Ren
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8/31/2010 1:28:08 PM
Posted: 6 years ago
At 8/31/2010 1:27:16 PM, TulleKrazy wrote:
At 8/31/2010 1:24:21 PM, Ren wrote:
At 8/31/2010 11:51:42 AM, PARADIGM_L0ST wrote:
Therefore, shouldn't there be a system whereby loans or credit is allocated for unexpected needs, rather than insurance scams?:

Uh, that is what insurance is... Unless you mean, should everyone have a "rainy day" account?

Right, everyone should have a rainy day account, supplemented with credit and loans when necessary. I don't see why that isn't more viable than insurance, rendering insurance a scam, which is effectively spending money rather than saving it in hopes that you might get help when you need it.

Do you know how many people don't have any savings? Let's say I drive a Mercedes and some idiot t-bones me. If said idiot doesn't have insurance, how in the hell is he going to pay for the damages to my car plus the cost of my physiotherapy/etc.? Not everybody get get a loan...

If that person cannot afford any savings, then he or she cannot afford insurance, either. Nor a car, for that matter.
nonentity
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8/31/2010 1:28:49 PM
Posted: 6 years ago
At 8/31/2010 1:27:16 PM, TulleKrazy wrote:
At 8/31/2010 1:24:21 PM, Ren wrote:
At 8/31/2010 11:51:42 AM, PARADIGM_L0ST wrote:
Therefore, shouldn't there be a system whereby loans or credit is allocated for unexpected needs, rather than insurance scams?:

Uh, that is what insurance is... Unless you mean, should everyone have a "rainy day" account?

Right, everyone should have a rainy day account, supplemented with credit and loans when necessary. I don't see why that isn't more viable than insurance, rendering insurance a scam, which is effectively spending money rather than saving it in hopes that you might get help when you need it.

Do you know how many people don't have any savings? Let's say I drive a Mercedes and some idiot t-bones me. If said idiot doesn't have insurance, how in the hell is he going to pay for the damages to my car plus the cost of my physiotherapy/etc.? Not everybody can get a loan...
nonentity
Posts: 5,008
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8/31/2010 1:32:10 PM
Posted: 6 years ago
At 8/31/2010 1:28:08 PM, Ren wrote:
At 8/31/2010 1:27:16 PM, TulleKrazy wrote:
At 8/31/2010 1:24:21 PM, Ren wrote:
At 8/31/2010 11:51:42 AM, PARADIGM_L0ST wrote:
Therefore, shouldn't there be a system whereby loans or credit is allocated for unexpected needs, rather than insurance scams?:

Uh, that is what insurance is... Unless you mean, should everyone have a "rainy day" account?

Right, everyone should have a rainy day account, supplemented with credit and loans when necessary. I don't see why that isn't more viable than insurance, rendering insurance a scam, which is effectively spending money rather than saving it in hopes that you might get help when you need it.

Do you know how many people don't have any savings? Let's say I drive a Mercedes and some idiot t-bones me. If said idiot doesn't have insurance, how in the hell is he going to pay for the damages to my car plus the cost of my physiotherapy/etc.? Not everybody get get a loan...

If that person cannot afford any savings, then he or she cannot afford insurance, either. Nor a car, for that matter.

Unfortunately, that's not how it works. Without insurance, people without savings will just find a new way to spend their money. Lots of people have cars and have expenses and have debt and not much savings. And as I said, if I drive an expensive car, and they need to pay me $30,000 to cover expenses, how many people have $30,000 sitting in the bank? I'd rather not take that chance..
LaissezFaire
Posts: 2,050
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8/31/2010 1:33:03 PM
Posted: 6 years ago
At 8/31/2010 1:17:15 PM, Ren wrote:
At 8/31/2010 11:05:27 AM, LaissezFaire wrote:
The idea behind insurance is to pool risks. Some people will need it, and some won't, but since no one knows which group they're in, they take the safe route and buy insurance. For a extremely simplified example, say 1 out of 1000 people will get cancer, which costs $100,000 to treat. An insurance company could just charge some amount higher than $100 per person. They would make a profit, and everyone would be protected against having to take a $100,000 loan, which would likely cause them to be stuck in debt for the rest of their life. Wouldn't you rather pay $100 than take the risk of having to pay back that huge loan?

A cancer patient will have a hard time getting insurance if he or she does not already have insurance. Most insurance plans deny those with preexisting conditions. Most insurance plans do not cover the majority of terminal conditions.

A $100 for something that costs $100,000 is unheard of; doesn't exist.

Personally, I would rather save my money and supplement it with a loan or credit when needed.

The idea is that people would buy insurance before they got cancer. Then since most of the people that bought insurance won't end up getting cancer, the insurance company makes a profit and the cancer patients get their bills paid.
Should we subsidize education?
http://www.debate.org...

http://mises.org...

http://lewrockwell.com...

http://antiwar.com...

: At 6/22/2011 6:57:23 PM, el-badgero wrote:
: i didn't like [Obama]. he was the only black dude in moneygall yet he claimed to be home. obvious liar is obvious liar. i bet him and bin laden are bumfvcking right now.
Ren
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8/31/2010 1:44:31 PM
Posted: 6 years ago
At 8/31/2010 1:33:03 PM, LaissezFaire wrote:
At 8/31/2010 1:17:15 PM, Ren wrote:
At 8/31/2010 11:05:27 AM, LaissezFaire wrote:
The idea behind insurance is to pool risks. Some people will need it, and some won't, but since no one knows which group they're in, they take the safe route and buy insurance. For a extremely simplified example, say 1 out of 1000 people will get cancer, which costs $100,000 to treat. An insurance company could just charge some amount higher than $100 per person. They would make a profit, and everyone would be protected against having to take a $100,000 loan, which would likely cause them to be stuck in debt for the rest of their life. Wouldn't you rather pay $100 than take the risk of having to pay back that huge loan?

A cancer patient will have a hard time getting insurance if he or she does not already have insurance. Most insurance plans deny those with preexisting conditions. Most insurance plans do not cover the majority of terminal conditions.

A $100 for something that costs $100,000 is unheard of; doesn't exist.

Personally, I would rather save my money and supplement it with a loan or credit when needed.

The idea is that people would buy insurance before they got cancer. Then since most of the people that bought insurance won't end up getting cancer, the insurance company makes a profit and the cancer patients get their bills paid.

For how long should someone have bought insurance before they actually have cancer?

In other words, including deductibles and pharmaceutical drugs and treatment inevitably not covered under insurance plans (there is no such thing as any patient in the United States who receives substantial treatment without paying something), as well as however much that cancer patient has paid in unused insurance over years, that patient would be far better off financially if he or she were to simply save the money or use credit to pay monthly dividends on money they have spent rather than some money they might spend and a lot of money they will not spend.
Ren
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8/31/2010 1:47:06 PM
Posted: 6 years ago
At 8/31/2010 1:32:10 PM, TulleKrazy wrote:
Unfortunately, that's not how it works. Without insurance, people without savings will just find a new way to spend their money. Lots of people have cars and have expenses and have debt and not much savings. And as I said, if I drive an expensive car, and they need to pay me $30,000 to cover expenses, how many people have $30,000 sitting in the bank? I'd rather not take that chance..

Sounds to me like you'd rather accept personal irresponsibility buffered by a corporate scam rather than realize that paying an insurance company and depositing in a savings account is basically the same thing, except that the money paid to an insurance company is money already spent, whereas the money in a savings account is still a consumer's money.

Supplementing it with credit would be no different than a sustaining insurance plan. You're simply paying only what you spent, which will inevitably end up cheaper for everyone.
nonentity
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8/31/2010 1:54:11 PM
Posted: 6 years ago
At 8/31/2010 1:47:06 PM, Ren wrote:
At 8/31/2010 1:32:10 PM, TulleKrazy wrote:
Unfortunately, that's not how it works. Without insurance, people without savings will just find a new way to spend their money. Lots of people have cars and have expenses and have debt and not much savings. And as I said, if I drive an expensive car, and they need to pay me $30,000 to cover expenses, how many people have $30,000 sitting in the bank? I'd rather not take that chance..

Sounds to me like you'd rather accept personal irresponsibility buffered by a corporate scam rather than realize that paying an insurance company and depositing in a savings account is basically the same thing, except that the money paid to an insurance company is money already spent, whereas the money in a savings account is still a consumer's money.

Supplementing it with credit would be no different than a sustaining insurance plan. You're simply paying only what you spent, which will inevitably end up cheaper for everyone.

But you're operating under the assumption that everyone would deposit into a substantial amount into a savings account on a regular basis and just leave it piling up into tens of thousands of dollars for a rainy day. I'm saying that more often than not, this doesn't happen. And if my car gets damaged by a person who has no savings and who cannot secure a bank loan large enough to cover my expenses, what should I do then?
Ren
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8/31/2010 2:21:56 PM
Posted: 6 years ago
At 8/31/2010 1:54:11 PM, TulleKrazy wrote:
At 8/31/2010 1:47:06 PM, Ren wrote:
At 8/31/2010 1:32:10 PM, TulleKrazy wrote:
Unfortunately, that's not how it works. Without insurance, people without savings will just find a new way to spend their money. Lots of people have cars and have expenses and have debt and not much savings. And as I said, if I drive an expensive car, and they need to pay me $30,000 to cover expenses, how many people have $30,000 sitting in the bank? I'd rather not take that chance..

Sounds to me like you'd rather accept personal irresponsibility buffered by a corporate scam rather than realize that paying an insurance company and depositing in a savings account is basically the same thing, except that the money paid to an insurance company is money already spent, whereas the money in a savings account is still a consumer's money.

Supplementing it with credit would be no different than a sustaining insurance plan. You're simply paying only what you spent, which will inevitably end up cheaper for everyone.

But you're operating under the assumption that everyone would deposit into a substantial amount into a savings account on a regular basis and just leave it piling up into tens of thousands of dollars for a rainy day. I'm saying that more often than not, this doesn't happen. And if my car gets damaged by a person who has no savings and who cannot secure a bank loan large enough to cover my expenses, what should I do then?

I don't know, the same thing you would do if you were hit by someone who either doesn't have insurance or does have an excellent attorney.
PARADIGM_L0ST
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8/31/2010 2:34:32 PM
Posted: 6 years ago
Right, everyone should have a rainy day account, supplemented with credit and loans when necessary. I don't see why that isn't more viable than insurance, rendering insurance a scam, which is effectively spending money rather than saving it in hopes that you might get help when you need it.:

The problem is that building this nest egg, along with a nest egg for retirement, takes decades. That means if your kid suddenly develops leukemia 5 days after you started this nest egg, you're screwed.

Or what of a procedure that costs $100k? Are you seriously going to tell me that you have that kind of money just chilln' in an account? I don't think so, and neither do most people have that kind of money to throw around.

There's no security in it, it's impractical, and if you have a job like I do, you don't have a choice. You have to pay in to insurance and you have to use the insurance provided to you.
"Have you ever considered suicide? If not, please do." -- Mouthwash (to Inferno)
PARADIGM_L0ST
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8/31/2010 2:47:26 PM
Posted: 6 years ago
People get loans all the time. You mean that it makes sense to you to get a car loan or an education loan, but not a health loan?:

Yes, people get loans all the time with an extensive look in to your portfolio. The amount is contingent upon many factors -- job history, income, collateral, etc. If the bank knows you have a high probability of dying, there is an correspondingly high probability that they will never recoup that money, in which case, yo won't get the loan.

Besides, loans should be last resorts. Credit would come first.:

The two are virtually synonymous. What great difference is there?

That sounds like a conversation between a cancer patient and an insurance agent, actually.:

And it would be the same applying for loans/credit. Banks don't just give you money. They want to know exactly what it is for so they can draft a contract.

I understand what you're saying, and in theory agree. But in theory paying a mortgage is also better than renting. Renting is in some instances just throwing money away to some people, but a lot of people cannot afford home mortgages and a lot of people cannot afford rainy day accounts beyond their piddly savings account. Those kind of rainy days are for, "Oh sh!t, I blew out a tire and the deductible won't cover it.," not "holy sh!t, I need a triple bypass angioplasty!"

One is $150.00, the other is $150,000.00. Considerably difference, no?
"Have you ever considered suicide? If not, please do." -- Mouthwash (to Inferno)
PARADIGM_L0ST
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8/31/2010 2:57:10 PM
Posted: 6 years ago
If that person cannot afford any savings, then he or she cannot afford insurance, either. Nor a car, for that matter.:

Nonsense. Almost nobody can afford a car outright either. Instead, they pay installments on a loan. The majority of people who don't have savings is not necessarily because they're bad with money, it's because they can't afford to. Most people would love to save money, but can't.

If you can afford it, then by all means do it your way. But make no mistake, the average citizen cannot.
"Have you ever considered suicide? If not, please do." -- Mouthwash (to Inferno)