As an academic definition, "insurance is a scientific institutional arrangement" is not an empty talk. I don't talk about academic issues here, but I think it is necessary to explain this sentence clearly.
Insurance system is an institutional arrangement based on the law of large numbers to deal with the life risks faced by human beings. This system can solve people's inner anxiety about birth, illness and death, and bring peace and harmony to people. So, how to understand the difference between institutional arrangements and non-institutional arrangements?
First of all, we need to realize that in modern society, human beings are facing various risks such as birth, aging, disease and disability. I often ask my friends in their thirties or forties to remind them whether any of their colleagues, friends and relatives have suffered from serious diseases (cancer) or serious injuries (car accidents).
It can be said that more than 90% or even 100% of the answers are yes, which shows that human risks are inevitable. The problem is how to solve the inevitable life risk with the most scientific system. This is a proposition. The answer is: the insurance system is the only "scientific" solution-besides the insurance system, we can't find a more effective way to solve this problem.
Imagine if it often happens around us: a person has a serious illness and the medical expenses will cost 500 thousand, so the unit will organize everyone to raise money. Donation is not a system, and it will also bring many side effects. If a system is used to arrange this risk in advance, then these problems will naturally be solved and the situation will be very different.
For more than ten years, I have always held the view that "if there is no insurance system, people who are not exposed to life risks will also face property losses". Maybe many people don't understand. Let me explain in detail: suppose you have 6,543.8+0,000 yuan in cash. At this time, you are safe and haven't encountered any problems, but you may also have property losses! Why?
Imagine if one of your relatives and friends is seriously ill or has an accident, and needs 6.5438 million yuan in cash, and the people around you know that you have money on hand, as long as you take it out, you can solve the problem. Then, although this 6,543,800 yuan is your savings for many years, I believe that many people will eventually choose to withdraw this money, at least part of it, out of kindness and morality.
Now in the same situation, if your relatives or friends buy enough insurance for themselves, then they can use insurance compensation to solve the problem, and your property will not face losses. In addition, for people who are seriously ill or have accidents, their psychological feelings are different from accepting compensation from insurance companies and gifts from relatives and friends. The former is determined by the system and inevitable; The latter may bring people a sense of psychological guilt and face a debt of gratitude that is difficult to repay.
Therefore, "if there is no insurance system, people who have not exposed their lives will also face property losses", which is the truth. So in my opinion, besides buying insurance, people around me should also buy insurance.
To truly and comprehensively understand the institutional arrangements of insurance, each of us needs to think carefully, so I won't talk about it here. Please believe that insurance has existed for hundreds of years in the countries with the most developed market economy, and it is still developing vigorously. It must have its theoretical and practical basis.