{"id":752,"date":"2013-11-06T12:39:00","date_gmt":"2013-11-06T12:39:00","guid":{"rendered":"http:\/\/admin.patheos.com\/blogs\/janetheactuary\/2013\/11\/what-part-of-the-term-insurance-do-you-not-understand.html"},"modified":"2013-11-06T12:39:00","modified_gmt":"2013-11-06T12:39:00","slug":"what-part-of-the-term-insurance-do-you-not-understand","status":"publish","type":"post","link":"https:\/\/www.patheos.com\/blogs\/janetheactuary\/2013\/11\/what-part-of-the-term-insurance-do-you-not-understand.html","title":{"rendered":"What part of the term “insurance” do you not understand?"},"content":{"rendered":"\n<\/head>

That\u2019s what I\u2019d like to say to Amanda Marcotte, writing in Slate\u2019s Double X blog <\/a>about the fact that insurance companies are now required to charge men and women the same rates for health insurance.<\/p>\n

Here\u2019s the key paragraph:<\/p>\n

Under the ACA, the individual market is being set up to look like the kind of insurance that you get through an employer, as Jonathan Chait at New York Magazine<\/em> explains<\/a>. So whether you are using a health exchange or you get insured through your employer, the young \u201csubsidize\u201d the old and young men \u201csubsidize\u201d young women. That\u2019s how insurance works. Which is why, if you look past the jokes about \u201cbros,\u201d it becomes quickly evident that what Roy isn\u2019t arguing against here is the ACA so much as the very existence of insurance itself. If it\u2019s wrong for older people or women to use more health care when everyone\u2019s paying into the system, then it should be wrong whether you get your insurance through your job or the health care exchange. Having your boss arrange the paperwork doesn\u2019t change the fact that some people need more health care.<\/p><\/blockquote>\n

Marcotte really, really seems not to understand insurance.\u00a0 She\u00a0writes as if insurance means, \u201ca large group of people paying into a system which reallocates benefits to those in need.\u201d\u00a0 That\u2019s a fair description of social welfare programs, in which we pay into the system with our taxes.\u00a0 That\u2019s even reasonably correct for certain church and community groups.\u00a0 But that\u2019s not insurance.<\/p>\n

Insurance is about paying a premium to protect against some unknown risk, based on your own likelihood of facing that risk.\u00a0 Insurance companies collect information on individual characteristics to assess that risk in the underwriting process, and the means by which they manage to function as a business is that collectively only a small number of policies are collected on in a given time period, but, fundamentally, policyholder\u2019s prices are not based on everyone\u2019s risk, but on their own.<\/p>\n

It\u2019s true that an insurer cannot concretely identify all of one\u2019s risks, but they collect the data that they can.\u00a0 Car insurance is based on how risky you are as a driver (based on age, sex, prior driving history) and, if your policy covers theft, the crime rate in your area.\u00a0 Life insurance is based, again, on age and sex, plus, for individual policies, health exams.\u00a0\u00a0Worker\u2019s compensation insurance is based on the riskiness of the line of work.\u00a0 <\/p>\n

Requiring young men to pay the same premiums as young women, or smoothing premium levels between the young and old is absolutely not insurance.<\/p>\n

Yes, it\u2019s true that employers don\u2019t require their employees to pay premiums based on age or sex.\u00a0 But this is a business practice, to provide benefits at the same rate.\u00a0 It has nothing to do with the issue of what insurance is.\u00a0 <\/p>\n

The point is that no one gets upset that men and women, and the old and young, pay different rates for life insurance.\u00a0 That Marcotte and her ilk reject true underwriting for health insurance means that what they actually support is\u00a0a social welfare benefit funded through a hidden tax.<\/p>\n

(She\u2019s far from the only one:\u00a0 even Obama has labeled the requirement to cross-subsidize as \u201ctrue insurance\u201d if I remember correctly!)<\/p>\n<\/body><\/html>\n","protected":false},"excerpt":{"rendered":"

That\u2019s what I\u2019d like to say to Amanda Marcotte, writing in Slate\u2019s Double X blog about the fact that insurance companies are now required to charge men and women the same rates for health insurance. Here\u2019s the key paragraph: Under the ACA, the individual market is being set up to look like the kind of […]<\/p>\n","protected":false},"author":2209,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-752","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"\nWhat part of the term "insurance" do you not understand?<\/title>\n<meta name=\"description\" content=\"That's what I'd like to say to Amanda Marcotte, writing in Slate's Double X blog about the fact that insurance companies are now required to charge men\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.patheos.com\/blogs\/janetheactuary\/2013\/11\/what-part-of-the-term-insurance-do-you-not-understand.html\" \/>\n<meta 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