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Hi thanks for doing what ever you're doing to help under- and non-insured people.

I'm disabled, Achondroplasia. Insurers in my country have constantly denied me health insurance. I have documented at length my ordeal with top health insurers in the country, Who are in partnership with leading international insurers[1]. Now there is 100% FDI for the insurance industry.

I've appealed to the regulatory body with each instance, But they always side with the insurance company as the former close my requests under totally different pretext (never mentioning that they denied me a policy) e.g. My complaint is that insurer not providing me the policy, Insurer responds to my complaint as 'Your refund will be processed in 10 days' and my regulatory body closes my complaint as 'Insurer has responded'.

This in-spite of clear supreme court verdicts in similar previous cases asking the insurance regulator to ensure disabled are not denied policies.

[1] https://abishekmuthian.com/insurers-are-putting-the-lives-of...

P.S. I will update some latest developments to the blog tomorrow where a insurer asked me to lie about my disability to get the policy.

This is why public health insurance is so important and why I feel so lucky to be covered by one: my brother had brain hypoxia during birth and even in a country (Spain) with a solid public system it places considerable personal and financial strain on our family.

I don't know about your legal system but in Spain at least it must be proved by the insurer that if you lie about a previous condition that lie is directly related to the payment they are trying to deny you.

That's a nice law. In Canada, most aspects of medical insurance are single payer, but other aspects (like out-of-country travel medical insurance) give too much latitude to the insurance companies. If you make any false statement when applying for insurance, when you try to use your insurance, the company will refuse your claim and declares the policy null and void. For example, theoretically, if you don't disclose even the smallest details (e.g. that you had a chest x-ray done 10 years ago that did not show any abnormality), and then you get something completely unrelated, like getting stabbed during your travel and have to go to the hospital, the insurance company can and will refuse to pay out. It's ridiculous.

https://www.cbc.ca/news/canada/british-columbia/retired-coup...

https://www.cbc.ca/news/canada/british-columbia/hefty-medica...

It does depend on the province. In Québec some travel medical care is covered by the state.

Technically yes, but practically no. The difference between paying nothing out of a 100k hospital bill and paying 1k out of a 100k hospital bill is approximately the whole bill.

> We reimburse, at pre-set rates, the cost of hospital services received as a result of a sudden illness or an accident, as follows:

> * a maximum of CA$100 per day for hospitalization

> * up to CA$50 per day for healthcare received at a hospital outpatient clinic

At those rate, I wouldn't even bother submitting the forms to RAMQ for reimbursement.

https://www.ramq.gouv.qc.ca/en/citizens/absence-quebec/know-...

Actually in most of the world this is not so bad at all. It's insufficient in the US or many third world countries, but if I were to fall ill in, say, Africa or South East Asia (+China) it would be pretty good.

I hope your brother is doing well and the law you mentioned clearly shows your Govt.'s attitude to protect the rights of insured over corporate profits; Congratulations for making that happen.

Here, I'm 100% certain that those who have significant per-existing illness have lied about it to get their policy. But the thing is, I feel the insurers want us to lie so as to deny the claim.

That's why I didn't lie about my per-existing illness to any of the insurers and so got my policy rejected by a clerks based on a business policy, not science.

> More than 90% of insurers in one recent industry survey stated that “exclusions or limitations” are a “methodology for recovery.” Translation: that means they’re expecting not to pay you.

To add an anecdote to this, I have a friend who used to work for an insurer and now works in reinsurance and regularly jokes that everytime an insurer pays somethings, someone is getting fired.

This is ihmo one of if not the most dishonest field of work in the modern world.

The root of this problem is the conflict of interest in insurance. You lose money when settling claims.

There are some companies addressing this problem for consumers.

Look at Lemonade.com, they do not benefit from not paying out as their margin is fixed or Laka.co makes money when claims are paid.

(Disclaimer: I work for Laka)

Sorry but Lemonade’s ‘fixed margin’ is BS. I’m not aware of any other insurance company that benefits from a fixed margin or spins what is otherwise OIE as profit. Most other carriers in the US pay for distribution, e.g. agents selling their policies or Google and other targeted ad platforms. Most carriers pay out a distributor margin and then are on the hook for the full risk.

Lemonade isn’t fixing anything for consumers except maybe UX.

If there is one thing I’ve learned over decades of startup and corporate experience, people that sell on ‘transparency’ are generally full of shit.

> Look at Lemonade.com, they do not benefit from not paying out as their margin is fixed

Lemonade reinsurers the vast majority of the risk. Their historical profitability will determine what reinsurers charge them (which is a premium). Basically all of their risk (75%) is reinsured.

If/when reinsurers tire of thin margins and high volatility, they'll hit Lemonade with a rate increase. Lemonade can either retain more of the risk, or pay the reinsurance premiums. The additional capital required to do that will either come from policyholders or shareholders.

Wouldn't the root of the problem be how much insurance is mandatory? If it wasn't then people just wouldn't buy it if they never actually paid out

How many times have your house burned down?

Events worth insuring against are so rare that you can't use experience from the last time to pick a better insurance company.

Hence, why the market is regulated.

Actually, I think my both renters and auto insurance contains a legal assistance insurance component, which is probably useful if I need to sue the insurance company :)

(I'm not sure it's as large as it ought to be, but the idea is nice)

really? I mean - from my anecdotal experience and observations, I'd conclude, that an insurer refusing payment without an understandable reason is still very rare.

To some extent, you get what you pay for, also.

It is quite common to be paid less than whole.

> incredible percentage of your policy that goes into marketing/admin/etc

The expense ratio is something like 30 to 40 percent of premium on commercial policies in case anyone was wondering. This figure is found on annual reports.

I'm not sure if insurers should be blamed for that though. Economically, that can be explained by the concave shape of consumers' Von Neumann Morgenstern utility curves describing their degree of risk aversion. It reflects their willingness to pay for a trading an uncertain outcome to a certain one.

I think prompting people with removing risk at the checkout counter might result in a different appetite for risk aversion than if they came to the decision on their own over a period of time. So maybe folks are being corralled into a losing bet?

Hum... Competition should make insurance prices independent of the consumers preferences for risk, just like it makes any other good's price independent of their value to consumers.

If insurance prices change with people's preferences, that's a strong signal the market doesn't have enough competition.

It just strikes me as an intensely bad equilibrium where the best priced insurance should be the one that advertises least, yet insurance is the most heavily advertised industry.

It makes sense why, it’s basically entirely 0 sum. There’s no innovation to be made, just stealing customers from other companies. Further, I don’t see how competition is improving the industry, as they have next to no tech. I see that competition may keep things honest, but especially in the cases like health insurance I can’t see how it has. Whether that’s entirely caused by bad policy I don’t know.

For all the above, in my dim understanding, it seems like one of the few truly ideal cases for being government run. I’d love to hear reasons why not.

you can compete on price, or you can compete on quality. price competition can take various forms, from operational efficiency (better actuarial science, more efficient claims, etc.) to marketing efficiency (better targeting, simpler product, etc.). quality competition would encompass more sophisticated products/product lines, better customer service, etc.

so there is a lot of room for competition to drive down price (and increase quality) without it being a zero-sum game. the problem is that markets for financial products are irresistable to the greedy (as it's stripped down to the bare essence of pursuing money itself) making ethically dubious decisions under greedy incentive structures. the government can create a more competitive market through regulation and enforcement but chooses not to (because of its own perverse incentives), so it's not a given that a government monopoly would necessarily be any better.

with most issues like this, the default option should be to do both: have government-run options (with no unfair advantages) in competition with (for-profit and non-profit) market participants. this is a pretty rare configuration however, since it removes the obvious (unfair) leverage points for taking advantage of a market.

When 40 some percent of your price is customer acquisition I don't buy the price being competitive.

Health I can see has some room for quality, but still some high 90% of the market doesn't go outside the bottom three plans across almost any type of insurance.

I can see the case for allowing insurance alongside. No need for monopoly, though the level of greed in the industry and ability to manipulate through ads is a weird balance - they're incentivized to keep you a bit paranoid.

it's not that the price is necessarily competitive, but rather, that there is (and can be) competition along multiple dimensions even in markets with high acquisition costs. of course, there could just not be enough competition in totality to drive prices down near the marginal cost of production, but significant customer acquisition costs don't necessarily indicate an inefficient market, since complex products (like insurance) require more effort toward customer education (e.g., sales & marketing).

my guess, however, is that the current equilibrium point above the marginal cost of production is likely more a function of regulatory capture. insurance went through a broad round of demutualization over the past few decades, and some of the capital gains of that process surely went into legal and political initiatives.

to the article's point though, insurance is an adversely-incentivized industry driven to over-financialize every possible risk, which is where it veers into gambling (just like equities and derivatives) and sensationalizing paranoia (just like news). insurance should be reserved for unlikely but impactful natural events, not common or man-made ones, which is what insurance has expanded into.

To your point about there being no innovation to be made. Better risk models would be a tech advantage that would allow one company to offer more accurate premiums.

But that's just wiggling around. There is no assembly line to be discovered when it comes to insurance.

What are you building for insurance? I used to be an insurance regulator, still find the space pretty interesting