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High-risk Pool
An equalization pool is a fund created to level out differences in financial risk, often across long periods of time, in a process known as risk equalization. Examples include mandatory health insurance and grower co-operatives. Health insurance In health insurance, equalization pools are used in countries such as Ireland, Australia, Germany and the Netherlands, to balance risks in groups of people of varying levels of health to ensure medical risks are covered for people who might otherwise be difficult to insure. The policies are also called high-risk pools and are made for covering the sickest uninsured people. For insurance companies, giving service to those citizens is deeply risky, so the government gives them some money to reduce the cost. In normal insurance markets, insurers price high-risk individuals at a higher premium to discourage them from buying insurance and offer lower-risk individuals lower premiums. That can make insurance phenomenally expensive for the elderl ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Risk Equalization
Risk equalization is a way of equalizing the risk profiles of insurance members to avoid loading risk premium, premiums on the insured to some predetermined extent. In health insurance, it enables private health insurance to operate in some countries to be offered at a common rate for all even though insurers are not allowed by law to reject clients or impose special conditions for their health insurance. That is achieved by transfer payments by a risk equalization pool usually run by a neutral party, such as a government agency. Health care In unregulated competitive markets for individual health insurance, risk-rated premiums are observed to differ across subgroups of insured people, which are defined by rating factors such as ageing, age, gender, family size, geographic area (because costs of care may be higher or lower in some coverage areas than others) profession, occupation, length of contract period, the level of deductible, health status at time of enrollment, health habi ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |