> moreover, most (all?) insurance creates perverse incentives (see: healthcare) unless strictly and carefully defined (which is likely never, since the incentiv

> moreover, most (all?) insurance creates perverse incentives (see: healthcare) unless strictly and carefully defined (which is likely never, since the incentive is to rope in as many policyholders as possible). It can, but it really depends on how the system is structured. The problem today is more the financialization of insurance that is creating the perverse incentives. Since financiers can again use insurance pool deposits to fund other activities the incentive is to aggregate as much cash as possible (as you noted), rather than providing stable, reliable insurance.