Originally Posted by
njkayaker
Yes, but the risk analysis is for a population (for an imaginary "individual" that represents the population).
The risk for an actual individual is going to be different. That's why insurance pools risk across a population.
The point of insurance is because individual risk isn't known.
As long as the risk of the population is determinable, insurance doesn't really care about the individual risk (it all balances out). On the other hand, the individual cares about his particular risk.
Since one is talking about predicting the future of a complicated event, one will never know the actual risk for a particular individual. Insurance will always require a population to average-out the unavoidable variation in individual risk.
Risk has a probability distribution too. You don't really deal with actual people by randomly selecting them. The individual is the size they are.
And that, ladies and gentlemen, just about vaporizes the argument that the 14.3% probability applies to individuals. A couple of deft paragraphs result in a final devastating broadside.
Pity is that
wphamilton is not listening or amenable to change. He'll sally forth again with whatever he can cut and paste that remotely offers the perception that he can hold his own.
Why is so hard for some people to say something to the effect of, "You are right, I stand corrected." It is so much better that the alternative, standing in a deep, dank, dark hole of your own making. My money is on
wphamilton keeping on digging...