To add in my 2 cents, I do believe that the original person was describing
something more like a savings account. She wanted to put aside a set amount
of money each month (the premium) and then be able to access that account in
case of emergency. Many people would find it a much smarter idea (and
easier to implement) if they simply opened up a "Christmas Club" account at
their bank.
Pamela
-----Original Message-----
From: Whitney Price [mailto:[EMAIL PROTECTED]]
Sent: Thursday, February 24, 2000 3:26 AM
To: [EMAIL PROTECTED]
Subject: Re: Insurance Planning
An additional thought is that insurance companies do not simply
"pool" the
money from the premiums to pay out. There would be no profit
in that and
quite a bit of risk from large claims. They take the premiums
and invest
them to have a larger pool of money for paying out claims and to have a
*nice* profit. By simply pooling the premiums, it is quite likely that
someone who has paid regularly over a period of time would be
denied a claim
because the "pool" had already been paid out by someone else's
large claim!
So to start a venture like this, someone would have to be an expert at
investing. Someone with that expertise is quite likely to not
want to start
a gerbil insurance plan...
