4 ms·

Yes, but that answer doesn't explain why anything insurance specific is needed. Courts can rule on contract disputes regardless of how complex they are.

ncmncm 6y ago
Courts take a long time to rule on complex contract disputes. The whole point of insurance is that you need the money now, not years later, as was already explained nearby: <https://news.ycombinator.com/item?id=25902290 https://news.ycombinator.com/item?id=25902290>. Insurance payouts delayed are insurance payouts denied. There are Nash equilibria at many different points on the curve, but only a narrow range where the value proposition of insurance is appealing to potential customers. An Insurance Commission's job is to force it into the range where negligence and arson are not paid, but genuine misfortune is paid immediately.
- thu2111 6y ago
  You could make a time based argument like that for any contract dispute. "Payout delayed is payout denied" isn't true, but if it were then it'd mean all contracts were useless. So you aren't showing that there's something specific to insurance here that's special, and there are plenty of mechanisms to help people who aren't rich get justice (e.g. no win no fee arrangements). If an insurance company is regularly stiffing people then it won't last long regardless of whether an insurance commission exists or not.
  - ncmncm 6y ago
    I.e, "All crooks will get their just desserts if we just wait long enough."
    - thu2111 6y ago
      No, that's not what I'm saying. I'm saying that if you have a working mechanism for contract enforcement, then insurer specific mechanisms on top should be redundant. The replies arguing with this seem to mostly be arguing that contracts don't really work, at least in the USA. Contracts are a very general construct that really do need to work, and it'd make far more sense to make them more enforceable than set up hundreds of industry specific commissions to try and make every commercial dispute one between a company and the government.
  - utucuro 6y ago
    Contracts where one party is incapable of getting the contract enforced are useless for that party. In the insurance case, an insured natural person may have lost the means to do so as a direct result of the event that leads to the insurance claim. If you lose your family and house in a fire, with marginal savings, then you may not be able to afford a lawyer and your contract is useless in the truest sense of the word. Unlikely situation? Yes, but then, that's exactly what insurance is all about.

ncmncm 6y ago

Courts take a long time to rule on complex contract disputes. The whole point of insurance is that you need the money now, not years later, as was already explained nearby: <https://news.ycombinator.com/item?id=25902290 https://news.ycombinator.com/item?id=25902290>. Insurance payouts delayed are insurance payouts denied. There are Nash equilibria at many different points on the curve, but only a narrow range where the value proposition of insurance is appealing to potential customers. An Insurance Commission's job is to force it into the range where negligence and arson are not paid, but genuine misfortune is paid immediately.

thu2111 6y ago
You could make a time based argument like that for any contract dispute. "Payout delayed is payout denied" isn't true, but if it were then it'd mean all contracts were useless. So you aren't showing that there's something specific to insurance here that's special, and there are plenty of mechanisms to help people who aren't rich get justice (e.g. no win no fee arrangements). If an insurance company is regularly stiffing people then it won't last long regardless of whether an insurance commission exists or not.
- ncmncm 6y ago
  I.e, "All crooks will get their just desserts if we just wait long enough."
  - thu2111 6y ago
    No, that's not what I'm saying. I'm saying that if you have a working mechanism for contract enforcement, then insurer specific mechanisms on top should be redundant. The replies arguing with this seem to mostly be arguing that contracts don't really work, at least in the USA. Contracts are a very general construct that really do need to work, and it'd make far more sense to make them more enforceable than set up hundreds of industry specific commissions to try and make every commercial dispute one between a company and the government.
- utucuro 6y ago
  Contracts where one party is incapable of getting the contract enforced are useless for that party. In the insurance case, an insured natural person may have lost the means to do so as a direct result of the event that leads to the insurance claim. If you lose your family and house in a fire, with marginal savings, then you may not be able to afford a lawyer and your contract is useless in the truest sense of the word. Unlikely situation? Yes, but then, that's exactly what insurance is all about.