that's the fundamental paradox of modern underwriting.

insurance relies on what philosophers call a veil of ignorance. it only works if we're spreading stochastic risk things that might happen to anyone.

once data gives us perfect foresight into a 90% chance of a million-dollar claim, it’s no longer insurance; it’s just a pre-funded bill. at that point, the pool isn't spreading risk, it's just facilitating a direct wealth transfer. the 'good' risks realize they're just subsidizing a known event for others and they flee the pool, which is exactly how the market for things like LTC collapses.

we're basically at a crossroads where better data is actually making 'insurance' as a concept mathematically impossible for certain risks.