What is the difference between pooling contributions to an insurance fund, on the one hand, and buying insurance from an organization with a large financial base, on the other? For that matter, what is the difference between a bank and a credit union?
Aggregators of pools of risk and reward could just as well be owned by the customers as they could be owned by shareholders whose executives service the customers. These are institutions ripe for heavy regulation where, like the power and phone utilities, the rate payers are equivalent to the shareholders in the risks each of them is or is not taking.
In a way, insurance companies and banks transact in gifts because loans and insurance contracts, by definition, cannot be cleared on the spot.
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