Health Policy Discussion - “What is Insurance?”
This is my “official” definition:
Insurance is an equitable form of compensation defrayed to its purchaser in the face of injury or loss. A key strategy in the area of risk management, it helps its purchaser navigate the uncertainties of life.
Simply put, insurance is a way of helping people bounce back from the hardships of life.
People are willing to purchase insurance because no one knows the future; no one knows if stocks will rise or fall, if war will erupt, or if that tree will faceplant into their new corvette. While it is easy to live life hoping for the best (and some do), chance is always a possibility (see: Murphy’s Law). Insurance is an investment, but the return isn’t capital, it’s a hopeful promise to normalcy in the event of a time of hardship. It is a sacrifice of a short term gain, such as a monthly premium, for a future guarantee: if something goes utterly wrong, then my “investments” will help to pay it off or reduce the financial burden. Therefore, in a way, insurance (especially health insurance) helps put people at ease of mind, knowing that a part of their future is in good hands. If they know that if something goes wrong, and they will be covered, people can take reasonable risks, and pursue a life worth living (of course, then there are those people who take unreasonable risks to the point of endangering their lives).
House insurance, car insurance, fire insurance, all these types differ from health insurance in that they deal with property, i.e. tangible items and things that, at the end of the day, remain items and things. Items and things that can be replaced; items and things have defined monetary value (see: price tag). Health insurance deals with persons; persons are undefined in value, priceless. There is no (legal) way to quantify how many US dollars your arm is worth, or your kidneys (see: black market). Because every human being goes through this crazy thing called “life,” and because “life” has so many variables and outcomes, one can only guess that each person has potential that cannot be quantified or measured. Thus, the measure of human beings extends beyond monetary worth, and encompasses nontangible characteristics such as morals, character, and the pursuit of happiness. For that, there is more value in a life than an object.
For that, Blue Cross charges me $90 bucks a month.