Insurance

Back in the day, the day being 1973-1981, I worked in the insurance industry. Part of the training, you may be relieved to hear, was a course on Elements of Insurance. It was part one of a nine-part course to become an Associate of the Chartered Insurance Institute (ACII).

One of the first things we were required to learn was this. The basic principle of insurance is that the premiums of the many compensated the misfortunes of the few. Fair enough. Nobody gets stung by a big loss because everyone agrees to a small loss calculated on the basis of experience.

I had worries about this when various groups began to be set aside, told they represented a low risk, and offered cheap premiums. Think SAGA, women drivers, post-codes for house insurance and many other examples.

Today we hear often that young people, once they have passed their tests, cannot afford insurance for their cars.

This week I read that life insurance may, in the future, use genetic readers to anticipate a person's chance of an early passing and thus raising the premium for the life-limited. I hope that various ethical committees will say that this is a bridge too far, But I wonder if we have established  a dangerous precedent.

What would it be like if all insurance premiums were better rounded? Then the fortunes of the many would still contribute to compensation.

Not having a claim is not a matter, as one customer once told me, of not getting your money's worth. It is a cause for rejoicing about the absence of misfortune.