StuartPlymouth wrote:Neil Green wrote:It's not so far removed from the ridiculous discrimination which until recently existed in both insurance and pensions towards gays and lesbians.
And worse than anything, last week Insurance Companies admitted they gave better life insurance/pension deals to smokers because they don't live as long.
They exist to make money, not do anyone a favour. If you end up in profit then it's purely by mistake!
Do you actually have any concept of how insurance markets work?
All companies exist to make money, but they very rarely do this by stealing it or ripping people off. They do so by providing a service that people willingly pay for. Equally they don't not rip people off for any high moral purpose; they just want to make money in the future as well.
Two very important things happen in insurance markets; those that are the worse risks tend to want to be insured (known as adverse selection) and when insured we tend to be less careful (known as moral hazard).
In the worst circumstances - where companies are not able to screen customers nobody is insured (because careful people don't want to be insured at the average price because their risk is lower and then the average cost to the company rises above the price that careless individuals paid for insurance; hence they don't offer the policy); the alternative is to identify those groups at larger risk and charge them for it accordingly.
It isn't always possible to identify and quantify risks successfully; black people may be a more or less costly motor insurance risk but is much harder to quantify than sex.
