[AngryParsley]

Companies make money off life insurance, even though mortality rates tend to 100% over time. It's similar with health insurance. This works due to several factors:

1. Insurance companies can invest payments from young people to cover costs when those people are older.

2. Not everyone gets old and sick. Healthy people who die in car accidents contribute much more than they take out.

3. While many people get old and sick, medical costs vary significantly and aren't very predictable for a given individual.

4. People are risk-averse. They would rather pay $1,500 every year than have a 1% chance of losing $100,000 in any given year. This is true even though 0.01 * $100,000 = $1,000 expected loss per year.