In my world there is a billionaire. She's one of the richest people in the world, comparable to to the very richest people in our real world.

In the country she lives in, there is no significant universal health care. All health care providers are private businesses and receive payment either from an insurance company or out of the patient's own pocket. There is no government law forcing anyone to have health insurance. Emergency rooms have to (by law) treat you for severe emergencies even if you can't pay, but they will try to get you you to pay it back later.

My billionaire is so wealthy that even if she were to get a horrible disease that required extraordinarily extensive and expensive treatment, she would hardly notice the dent in her personal fortune. See is rich both in terms of assets and in liquid cash, as well as precious metals, stocks, etc. She has spread her assets out in a variety of ways, to reduce the risk that a streak of misfortune could remove her wealth.

Expect for the particular details given here, assume the world is similar to the real world, and the country is similar to the United States.

Insurance companies make money by taking on risks people themselves can't take, and they charge for it.

My billionaire pays regularly for health insurance. Why does she do that?

Please note that this is not about life insurance, only health insurance.


closed as off-topic by Mołot, Vincent, CaM, Mark Olson, sphennings May 31 '18 at 13:12

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    $\begingroup$ The reasons someone would do this are well documented and known. The question could be reversed : why would this billionaire not have health insurance ? I don't think you've looked into this enough. $\endgroup$ – StephenG May 31 '18 at 6:58
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  • $\begingroup$ The real question is why wouldn't she? I suppose that she has not only health insurance, but also life insurance, property insurance, various forms of commercial insurance for the business(es), various forms of transport insurance for the merchandise she delivers, and some legal firm(s) on retainer. The invention of insurance was one of the most important developments which led to the modern world. $\endgroup$ – AlexP May 31 '18 at 8:31
  • $\begingroup$ Insurance companies make money by taking on risks people themselves can't take, and they charge for it. This is not really correct. Insurance companies calculate overall risks and charge premiums based on spreading total costs over the entire customer base. The ability of individual customers to absorb risk on their own is irrelevant to this. $\endgroup$ – StephenG May 31 '18 at 8:40
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    $\begingroup$ @MichaelKjörling I would argue that the character itself isn't really described by the op, just how much money she has. One cannot answer this question for this character specifically but only for that subset in general - so on-topic. $\endgroup$ – Raditz_35 May 31 '18 at 9:18

Three possible reasons:

  • The health insurance allows her to pay the "group rate" for medical care, instead of the "uninsured rate". And she happens to prefer medical providers who are covered by her insurance plan.

  • Her assets include a large business that offers a health insurance plan to its employees and directors. There are morale benefits if the employees know that their health insurance plan is every bit as good as hers.

  • She wants to be treated by a particular medical provider who has an exclusive relationship with a particular insurance company. For example, some HMOs own medical offices and hospitals, and thus hire many doctors and nurses on a full-time basis.


So let's not focus on the financial aspect of this, at least not directly.

Because she is a nice person. She wants to set an example for those that don't want to get insurance but really would benefit from it. This might be the case in particular for a country without universal health care.

Because she has political interests aligned with something like one of the two major parties in the US, the one that is pro health insurance. If she wants political power or just them to have political power for whatever reason she might have, she should really demonstrate that she is in line with what the party stands for.

Because she is so rich that she owns a significant part of the company that sells her the insurance. Better buy your own products.

In my country, if you have a child, that kid is usually also insured with you and so is the spouse. If those people don't have direct access to her wealth, they are still protected.

And that what the others said. And much, much more.

  • She may have more information about her health status than the insurance, causing this particular case to be a good deal. Rich people are often smart about their money, even if they wouldn´t need to, financially.

  • She may lower her administrative overhead by just showing her insurance card. Her time may be more valuable to her than some premium.

  • She may have a habit of lowering risk in all her liabilities, including health.


For the same reason why (rich) people keep borrowing money instead of paying cash: the difference between what you gain investing your money and what you pay for borrowing is positive for them.

In case of health issues, what works better? Keeping 50K \$ constantly aside for "just in case", or investing those 10K \$ at some interest rate and pay 100 \$ a month of health insurance? If the investment can pay off more than 2.4% yearly, paying an health insurance is more convenient than paying cash when needed.

  • $\begingroup$ Another reason that many rich people borrow money is to defer paying taxes on the money they use to buy things. Instead of paying taxes now, they can borrow, and pay taxes when they pay back the loan (if they ever do). $\endgroup$ – Jasper May 31 '18 at 7:05
  • $\begingroup$ Your math is based on a false premise. You don't keep the $50K or whatever set aside in a non-interest bearing account (or stuffed under your mattress :-)), you invest in along with all the rest of your money, and take out enough to pay bills as they come due. $\endgroup$ – jamesqf Jun 1 '18 at 5:10

The health insurance has:

Clone Policy

You say she is stupidly rich, then the health insurance might have offered here insurance in form of clone, when she notices something wrong with herself, or dies, The insurance will produce a clone that is younger and healthier, thus making her somewhat immortal.

The subject (the wealthy woman) has something on her brain that can record everyday activities and save it into her clones which is protected by the insurance. So at any instance that the person dies of anything, a clone can be produced immediately.

If she is sick with a incurable disease, she can opt to use the clone for spare organs, or better yet, transfer her memory into the clone.

Continuous subscription on that health insurance will grant her additional clones per year. So she can literally die 365 times in a year, but still continue to live on. The value of her health insurance is massive, but with the wealth that she has, its a little price to pay for the security of her own fortune.

To differentiate, I used this as my reference.

  • $\begingroup$ Let's not debate whether this is a real thing and the super rich are cloning themselves, we won't solve this debate here. What I would be interested in is why this is even offered by the health insurance company? To me this sounds like a bit of a scam, make everyone pay into the pool and then offer policies to the rich that give them special treatments that they have to pay for less in general? I mean, it's nice to mention what she (supposedly) can get for money, why do this via insurance though? Are you just suggesting that health insurance for the rich might be a way for them to scam people? $\endgroup$ – Raditz_35 May 31 '18 at 9:27
  • $\begingroup$ @Raditz_35 I'm not saying this is a real thing, its just a maybe. This is offered only to those who can afford it since cloning is expensive perhaps. And since clones are expensive, only the richest person can afford it, and for this particular individual, it makes her a bit immortal. You cant bury your money along with you in your grave, then why not replicate yourself? $\endgroup$ – Mr.J Jun 1 '18 at 0:03

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