> The entire idea of insurance is that it should be priced to take losses into account and break even. insurance needs to make a profit or there is no incentiv

> The entire idea of insurance is that it should be priced to take losses into account and break even. insurance needs to make a profit or there is no incentive for investors to risk the loss of capital or assume the opportunity cost (meaning they could invest elsewhere). The person selling the insurance exchanges gives up a known regular amount to protect themselves against an unpredictable potential loss. The insurer accepts the risk of paying the unpredictable future cost in order to receive known predictable regular income. If the expected value of the transaction is zero then the insurer is essentially risking their capital for nothing.