TragicMonkey said:
Not entirely. Insurance companies are not to be trusted. They already dislike the idea of risk, which is the whole point of insurance to start with, and would be delighted to be able to predict possible future expenses. They charge a lot more to insure the obese because they're more likely to have heart attacks...you think they wouldn't leap at the chance to drop people who are likelier to end up with cancer?
Haven't been through the entire thread, so slap me around if this has already been addressed:
1) Insurance companies don't dislike the idea of risk. If they did, they wouldn't be in the insurance business to begin with.
2) They
would be delighted to be able to predict possible future expenses. But that wouldn't be any different from today. They set rates based on the likelihood that they're going to have to pay out, which is why your 16-year-old testosterone-poisoned son is going to pay more for car insurance than your Presbyterian minister who only drives his Volvo one mile each Sunday. They can't predict
exactly what the risks and costs are going to be for each individual, since they have to work in the fuzzy world of statistics and actuarial tables, but they can predict risks and costs for a large population of insureds.
3) If government doesn't interfere with the insurance market, high risk people will still be able to get health and life insurance, just as high-risk people can still get credit cards. They may have to pay more, just as high credit risk people have to pay more for credit. But there will always be a market for those people - just as there is always a market for testosterone-poisoned 16-year-olds.
Part of the problem is that government
does interfere with the market. Some states won't let you buy health insurance from out-of-state vendors. The result is market distortions, where insurance vendors who may have lower rates aren't allowed to compete. What's the explanation for that?
Yeah, if your insurance company finds out you have a gene that's likely to cause cancer when you turn 35, they may raise your rates based on that. But what happens if they also find that you have a gene that enables you to gobble down a dozen donuts every day and still have singe-digit cholesterol? In a free market for insurance, wouldn't they be forced, by competition with other insurance companies, to drop your rates because you have that gene?
Not all genes are bad, you know...