Sunday, February 22, 2009

A thought on insurance

It's clear that the Western world enjoys the capitalistic financial system and its market economy, though the systemic inequality of pure capitalism often results in problems for people who are hit by sudden crises or emergencies and become financially ruined.

So, in the absence of socialism, we see a market demand for a system to fill some of the functions of socialism without replacing the current system. Thus with insurance people voluntarily buffer their successes and failures; they recognize that if they hit an unanticipated rock bottom they will receive assistance (i.e. receive more than they put into the system), with the understanding that it's far more likely they will put more money into insurance than they will take out.

We won't go into the bureaucracies and corruptions of privatized insurance here, but it's clear that insurance in a capitalist nation serves as a sort of market traded, limited socialism. "Market-traded" because it's something that citizens can choose from (although citizens are required to purchase certain types of insurance and don't always have the option to set up a private savings instead), and "limited" because each insurance corporation has influence over only its customers and various plans are available.

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