Re: A physical visit is a lot more reliable
@Yet Another Anonymous coward
"But insurance is a game of playing the odds". Exactly. It is called underwriting and used to be the main tenet of insurance: "The premiums of the many covers the losses of the few". And you (the insurer) cover yourself against disasters by reinsuring it.
Basically how it works is that you use three years' claims statistics (wheighted more to the most recent year, to account for inflation) and then decide what your underwriting profit should be - say 25%, and Bob's your uncle. Insureds who had claims pay a little bit more, especially if they have a history or regular claims, whilst claim-free insureds get a little deduction.
Sadly, underwriting seems to have been sidelined (see below), bit in all fairness, I suspect it is mostly driven by consumers who goes for the cheapest, without giving a thought to the ramifications. As in all matters, cheapest means something was taken away from the product (quality of workmanship or materials, design, et cetera) and in the case of insurance that means reduced risk to the insure, by means of more stringent warranties, wider ranging exclusions and reduced cover. Hence the disgusted cries of "insurance is a scam!!!" when it comes to claiming and it is discovered that the complainant did not have the cover they thought they bought (because who reads their policy wordings? And it is currently very difficult to obtain a wording prior to buyng a policy - you only get a summary AFTER you bought your policy - at least here where I live).
When I started working for a large insurance broker in the mid-eighties, Uberrima Fides was the guiding principle that the company adhered to; I think nowadays the guiding principle is Caveat Emptor. I might be wrong, of course, having been drawn into the IT side in 1995 and now retired, so things may have improved again, but I very much doubt it.
You should also remember that almost no company make money on what they sell (whether services or products), but rather on interest earned on the stash of cash they have in their possession. So in times of high interest rates, they chase premiums, lowering their rates in hopes that enough people will fall for it and come flocking to them because cheap, and qlso hoping that they will have a reletively claim-free year. And when they get bitten by this policy, the insureds have to foot the bill by means of increased rates the next year. And it is the good insureds who will foot the bill, since the claimers were either shown the door, or already left because of punitive rates.
Chasing money has also lead to the practice of paying your creditors as late as possible, while demanding immediate payment from your debtors. Once again it is the small companies and private individuals who get stung by this practice.
But ever since Make as Much Money as Possible has become the main focus of companies, it seems that all rationality has left. The upshot of that