Universal health care is basically a special case of “people in the pool having similar risk,” because the idea is to have only one pool with everyone in it. The “with everyone in it” part solves the adverse selection problem.
"Sorry to hear you got cancer, here's your cheque. Please don't bother us anymore, as we terminate our contract. All the best."
Health care is more like a flatrate plan where some people receive much more intensive service.
Many forms of insurance include a cap to reduce the insurer's risk, but that doesn't mean such a cap is necessary for it to be called insurance. The height of the premium can be defined by law, but it's still an insurance premium.
Pensions can be hard to understand because longevity risk is a bit counterintuitive, but depending on how they work in your country they can definitely be a form of insurance.
Depending on your country this catalog is also shrinking and pushed into private insurance. Since there is such variability between countries and their systems these discussions become 'hard' to have because something that is normal for one guy works the opposite in the other guy's country.
In Germany I had dental covered by the state. Like you said, fixed percentage of my income covered all that (and all the other health insurance needs with a catalog of services). No need to think about it. Except someone actually decided on that catalog based on monetary concerns and calculations. Also while there is a fixed health insurance cost as a percentage of your salary, there are different actual insurance companies and they add a variable premium to this which they 'compete on' for clients. This is the public system which must cover you and you can go fully private (and never be admitted back into the public system if you do) which gives you "better service" (like private rooms being standard at the hospital and such).
Then they added private insurance on top for some stuff that wasn't covered by the public dental plan any longer. In Canada just a regular filling needs to be paid out of pocket and I really want private/employer extra insurance. Different for kids where I pay out of pocket for a white filling but Amalgam would be covered. I don't even know if this is the same in other provinces maybe.
Pension: Germany has a pyramid scheme and it collapsed a while back. Not enough payers any longer and suddenly they had to tax people's pensions. People who they told need not worry about their pension ever. Suddenly they were told they would need to pay tax on their pensions and oh btw. you should really have started paying into private pension like a decade or so ago. From after tax income. They do have various private insurance schemes that lower your taxable income but the fees are sky high and returns meager. It's a way to shuffle money into insurance companies. Thank's government! And other than that, you can get ~800 EUR of tax free interest/dividends per year. Everything else is taxed at 25%.
This is way different in Canada again where Old Age Security and your pension are not covering you and everyone knows. People either work longer because they can't afford extra insurance or have an RRSP (kinda like a 401k) they pay into. You know you will be taxed on this later but you aren't now. And all your money grows tax free in that account. Never pay a single dollar of taxes on those dividends over the years. And a non pension tax free savings account on top of that. Sure it's after tax income in there but you can take it out any time. No need for any insurance company fees either if you don't want to. Sure you can buy mutual funds and such but you arent forced to just to be tax exempt.
The complicating issue here being that you’ll eventually pay income tax rates on those dividends instead of (usually) lower dividend tax rates. If your income is high when you retire, you might pay more in taxes this way with the deferral. And it’s hard to know in your 20s and 30s what your income will be when you retire. But as a form of insurance, you should still build that nest egg.
Now here in Canada you pay something like half of your tax rate and its different whether they're "eligible" or not and such things. But all that is only outside of tax sheltered accounts and at least on my end I don't make enough to worry about calculating that. Then again at least here in Canada you also need to be aware of the whole withholding tax thing on US stocks and the implications for your dividends coz the US recognizes RRSPs as tax sheltered but not TFSAs...
Of course I won't really know whether I maybe make more in retirement than I do now but I personally believe that I will definitely make less than I do now. And if I really do earn more in retirement than I do now then I am probably very well off an it will in part be because my RRSP and TFSA contributions were able to grow without loosing 25% of the dividends all the time. So if compounding then does its thing and make me rich (I doubt I'll actually be rich from that though) then I'm fine with being taxed on it then.
It's not so much about whether you'll make less or not, but if you'll make enough less to land in a lower tax bracket to take advantage of the deferral. And avoid dying and having to pay tax on it all at once (unless you can shift it to your spouse, but then they may have a high income problem too, negating the benefit of the deferral).
RSPs can be great, but I think they're oversold to the working class as a tax advantage.
Different question since you seem not to like tax deferral. What makes you not like tax deferral and compounding on the extra ~25% of dividends you keep?
I can't do much about when I'll die. I do advocate for 'living now' btw. If you can do that 'trip around the world' now or put money into a pension fund, do it now. Don't wait, have kids and tell yourself you'll do it when you retire. That day may never come or you might not be up to it any longer for various reasons.
This is the wrong analysis. While it's true that when you withdraw you pay taxes at the marginal rate, you also need to realize that your contributions are before tax. When you're withdrawing, you're not paying income tax rates on the gains/dividends, you're paying income tax that you previously deferred. The gains are still tax free.
That's not true. The taxation of pensions in Germany is a gradual shift accompanied by a parallel shift to tax-free payments into the pension funds.
Please stop that FUD.
The system did just fine, but was plundered by politics. During the German reunification, the people from the former Eastern Germany were added to the public pension fund without ever having anything payed in. This drastically increased the amount of recipients without bringing in additional money.
Politics decided that. They also decided to not put any tax money in the pension pool to re-balance it.
No matter how you design a pension fund: If you bring in an additional country as recipients without any additional capital, that pension fund won't survive.
[1]: https://www.bpb.de/politik/innenpolitik/rentenpolitik/290963...
Really the issue is people with incurable conditions. Universal health care is there for them. Private insurance fucks them over.
How could it be both?
And if it was beneficial, how could you describe the people to whom it was beneficial as "healthy and fit"? Aren't they really just people who the screening failed to identify as unhealthy?
I.e. they keep you in the healthy, fit and young group until you get cancer, and then they move you over to the $7,000/month group.
The current system just averages that out. Your rates are higher than they have to be when you're young, but your rates are lower than they have to be when you're old. It negates the risk by lumping everyone together. Your form of insurance doesn't do much to reduce risk because you can always be moved to another category. The insurer really just becomes a middleman between you and your medical providers then, if the goal is to allow people to pay for what they use. It's basically an HSA.