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Generic Confusion

When you leave, my blog just fades to grey
Nu ma nu ma iei, nu ma nu ma nu ma iei

News? Check. Politics? Check. Music? Check. Random thoughts about life? Check. Readership? Ummm.... let me get back to you on that. Updated when I feel like I have something to say, and remember to post it.

Wednesday, October 21, 2009

New insurance company proposal

In individual health insurance, which is underwritten, the issuance of a policy, and the premium for the policy, are based on the facts, as expressed in the application and verified with some tests. A significant claim can cause the application to be reexamined, and sometimes, material differences can be discovered, leading to the policy being canceled. This process, called rescission, is a protection against fraud, but honest mistakes can lead to rescission as well. However, it is important for insurance, which is priced based on expectation of claims given underwriting guidelines, to meet these guidelines.

As a crazy idea, I suggest a private individual, one dissatisfied with the existence of rescission, found an insurance company to honor these original contracts. I nominate Warren Buffett, whose conglomerate has insurance experience.