At the individual level, it seems a lot like gambling but insurance is not about individuals, it's about the pool. You and a million other people give State Fa

At the individual level, it seems a lot like gambling but insurance is not about individuals, it's about the pool. You and a million other people give State Farm $12 so that in the event of fire or flood affecting a subset of the pool, there's enough money collected to pay out to make claimants whole. There are no "winners" in the insurance game, only losses. If they have to pay you, you've already lost both the premiums you've already paid as well as what people or property were damaged (gambler's fallacy at work-- your entire neighborhood is smoldering and your family is dying painfully in the burn ward, but here's your insurance check, you winner!). In your case, even if your apartment does burn down, it's not like you walk away with a windfall (unlike gambling). The adjuster is going to see to it you end up no better off than almost-exactly how you were before the fire. You don't "win" anything, and the meager payout you get can't always replace who or what you lost in the process. Everybody involved also loses if more peoples' apartments go up in flames than there is money in reserve-- unlike with lotteries, where the payout is distributed equally amongst the claimants.