> Where's it's hard to separate risk levels of different people. If not you get adverse selection, where the average cost discourages the safer people, leaving

> Where's it's hard to separate risk levels of different people. If not you get adverse selection, where the average cost discourages the safer people, leaving the less safe. I don't think this is necessary at all. You need insurers and the insured to have a similar understanding of their risk level. If you can accurately price it, it should be cheap for lower risk people and more expensive for riskier people. This doesn't achieve social goals in the context of health insurance, but that shows more about how insurance isn't a great model for healthcare, rather than limitations of what insurance markets can work.