I understand how insurance works, but you haven't really addressed what I'm talking about, which is that insurance companies often don't seem to understand how insurance works. You can't expect to make a profit off of every account - it defeats the purpose of an insurance scheme altogether. If an insurance company raises the premiums on a person after they make a claim, or drops them from coverage, even when the nature of that claim does not raise their risk profile, then they're doing it wrong.
I would think Insurance companies understand their business better than most industries < you loose a lot of money fast if you do risk wrong.
They don't expect profit from all their accounts, not a priori. However they choose to do business only with those account which they believe will be profitable. If They expect to loose money from an account, they'll choose not to do business with you.
We can debate if this is moral or not (some religions state it's not, i.e. the Amish as it is a form of gambling and discourages charity) but that's the game.
You're right. The parent comment is explaining only the actuarial risk model of insurance schemes, which is not the same as raising rates on a customer for makng a claim, even when his/her risk profile is unchanged.
The purpose is clearly to discourage you from making a claim, which is what makes insurance a legal scam.
