That's not quite true. A pool has less variability than an individual. My expected cost of future accidents might be N, with variance M >> N. The insurance po

That's not quite true. A pool has less variability than an individual. My expected cost of future accidents might be N, with variance M >> N. The insurance pool can absorb it if I have a catastrophic outcome, but I can't. So it may be worth buying an insurance contract with a negative expected value to hedge risks.