Is the insurance industry just a really big legalized "Ponzi" scheme?

Is the insurance industry just a really big legalized "Ponzi" scheme?

NoWhether insurance is for a home, a auto, or medical it works on the basis that a certain amount of claims will come from a certain amount of people who enroll. Based on that the premium rates are set for a policy which provides certain benefits.For example in employer medical insurance plans research, over several years, shows 85% of the premium dollar goes to pay medical treatment expenses. Out of the 15% for administrative costs only 3% of the premium dollar goes to profit.Many types of companies make a much higher percent of profit than a insurance company.Source(s):Experience with medical insurance.

mbrcatz

No, you're confusing that with Social Security, which really IS a Ponzi scheme.Go back and research insurance with wikipedia or yahoo finance. They will explain it.

J7

There are many types of insurance, so I think it would definitely help to know at least which type(s) of insurance you are talking about.Auto liability insurance is fine, and driver/owners need it, for example. But eyeglass, dental, and health insurance is currently so flooded with greedy scams in my opinion. Loan insurances are another type, and I never did like them or need them personally.I would certainly say that most of the current insurances that pertain to anything about human health are currently legalized schemes.

John

There are many types of insurance, so I think it would definitely help to know at least which type(s) of insurance you are talking about.Auto liability insurance is fine, and driver/owners need it, for example. But eyeglass, dental, and health insurance is currently so flooded with greedy scams in my opinion. Loan insurances are another type, and I never did like them or need them personally.I would certainly say that most of the current insurances that pertain to anything about human health are currently legalized schemes.

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