Have You Stopped Beating Your Insurance?

There's a rather inflammatory post up at another site based on the claim that a handful of states allow carriers to deny coverage to abused spouses. We'll take them at their word regarding which states have such laws on their books, and try to understand exactly why this is even relevant.

First, the post's author had to go back almost 15 years to even find carriers which engaged in this practice. He then lumps together health, life and disability carriers, as if the risk and underwriting issues were identical across these lines.

They're not.

But the post fails to answer three questions:

1) How is this the insurers' fault? If it's such a heinous idea, then legislators can close the (alleged) loophole.

2) How many carriers even engage in this practice, and how, exactly, do they even determine who's been abused? I looked at applications from all three lines, from a variety of carriers, and not one of them ask about abuse.

3) Is it even a bad thing to decline to insure folks who've been abused?

That last will no doubt get me in hot water, but let's take a look at it through our favorite lens: risk.

Of course we don't condone spousal abuse, whether physical or otherwise. But we also don't condone drunk driving or snorting coke, both of which make it difficult to purchase auto and health insurance. I haven't seen any great uproar from folks who think it's bad that habitual DUI offenders are hard pressed to buy auto insurance, for example. And that's the point: insurance is about risk, and auto insurance companies know that someone with three DUI's is likely to be a bad one.

As is someone who stays in an abusive relationship. It's not about morality or victimhood. It's about risk: if you're being beaten pretty regularly, you're going to be making a lot of trips to the (expensive) ER, and you're likely not a particularly attractive prospect to a health (or life, or disability) insurer. Is that fair? Maybe not, but "fair" has nothing to do with risk.

Seems pretty clear to me.

[Hat Tip: Holly Robinson]