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Let's talk about the basic principle of insurance.
Some say it is a hedge in case something goes wrong but the origin of insurance to my knowledge started at a pub in London called Loydds.
Customers at the pub near the docks started placing bets on which ship will reach their destination and which won't.
Gradually ship owners started to bet on other ships that they will reach safely to their destination and when they didn't paid off to the owner.
In other words, it's another form of "GAMBLING".
With life insurance you're betting on the out come of your life so the house gains more if you have a higher risk since the minimum wage is higher for each participants. On the otherhand, people who have little risk, the odds becomes LOWER meaning check-ups works against the house.
The house can also call foul and not paying for example not declaring actual health status not taking check-ups, so on and so forth.
Another interesting thing about insurance is statistics, this becomes the basis for minimum wage but with any mathamatical tool there are limits. In this case, the smaller the denominator a slight change in numerator changes the outcome or in this case odds changes drastically but the chances of a person being sick within the denominator is universal so the house always has a better chance of gaining.
With any type of gambling the house wins at the end no matter what.
The real question is how much should they be allowed to win?
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