Abstract
What makes insurance special among risk technologies is the particular way in which it links solidarity and technical rationality. On one hand, within insurance practices ‘risk’ is always defined in technical terms. It is related to monetary measurement of value and to statistical probability calculated for a limited population. On the other hand, and at the same time, insurance has an inherent connection to solidarity. When taking out an insurance, one participates in the risk pool within which each member is reciprocally responsible for others’ risks. The combination of technical controllability and solidarity has made insurance a successful tool for governing welfare societies during the twentieth century. From the point of view of business ethics, it is interesting that, as we argue in this article, the connection between insurance and solidarity is not limited to social welfare assemblages, but is evident in relation to private insurance as well. At the same time, however, it is important to understand that insurance does not advance all forms of solidarity. Hence, this theoretical article analyzes the specific conceptions of solidarity that the different forms of insurance practice produce. Particular emphasis is put on the distinction between ‘chance solidarity’ and ‘subsidizing solidarity’. The main questions of the article are: What kinds of conceptions of solidarity are built in the insurance technology? And how are the limits of solidarity defined and justified in different forms of insurance?
Similar content being viewed by others
Notes
It is noteworthy, however, that sometimes even in insurance solidarity, emotional bonds can act as justifications. Statutory social insurance is often linked to national solidarity or at least to mutual solidarity among the working population. Additionally, the promotional campaigns for private insurance have systematically appealed to moral responsibility and, especially in the earlier decades, also to the mutuality of the insurance community (Lehtonen and Liukko 2010). Similarly, as Bill Lesch (2011, personal communication) has pointed out to us, in the US, there are many groups requiring affiliation (American Association of Retired Persons, Lutheran Brotherhood, Masons, etc.) to benefit from their mutual, or, contracted insurance. So it may be that some—but certainly not all—forms of insurance require group identity to participate.
From the point of view of general discussions concerning the concept of solidarity, it is interesting that May (1996), among others, does not include equality or justice among his criteria of solidarity.
Of course, in practice, price setting can be more complex. In addition to actuarial risk calculations also various commercial, practical and public opinion related reasons might affect the actual prices.
It is worth mentioning that in this respect, the size of the market matters. Within the EU, the life insurance business is still divided according to national markets. As Finland constitutes a rather limited market, it has not allowed for as advanced forms of segmentation and risk categorization of clients as has been the case in larger markets (Ollikainen 2004, p. 97).
In Finland, such suggestions have been put forth by the former Prime minister Esko Aho, in Helsingin Sanomat (14 September 2005), and a leading lobbyist for big industry, Johannes Koroma, in Talouselämä (4 April 2008).
References
Baker, T. (2002). Risk, insurance, and the social construction of responsibility. In T. Baker & J. Simon (Eds.), Embracing risk. The changing culture of insurance and responsibility (pp. 33–51). Chicago: University of Chicago.
Baker, T. (2003). Containing the promise of insurance: Adverse selection and risk classification. In R. Ericson & A. Doyle (Eds.), Risk and morality (pp. 258–283). Toronto: University of Toronto Press.
Bayertz, K. (Ed.). (1999). Solidarity. London: Kluwer.
Beveridge, W. (1942). Social insurance and allied services. London: His Majesty’s Stationery Office.
Canguilhem, G. (1966). Le normal et le pathologique. Paris: PUF.
Castel, R. (2003). L’insécurité sociale. Qu’est-ce qu’être protégé? Paris: Éditions du Seuil el La République des Idées.
Dean, M. (1999). Governmentality: Power and rule in modern society. London: Sage.
Durkheim, E. (1984). The division of labor in society. New York: Free Press.
Eisenhauer, E. (2002). In poor health: Supermarket redlining and urban nutrition. GeoJournal, 53, 125–133.
Ericson, R., & Doyle, A. (2004). Uncertain business. Risk, insurance and the limits of knowledge. Toronto: University of Toronto Press.
Ericson, R., Doyle, A., & Dean, B. (2003). Insurance as governance. Toronto: University of Toronto Press.
Ewald, F. (1986). L’Etat providence. Paris: Bernard Grasset.
Ewald, F. (1990). Norms, discipline, and the law. Representations, 30, 138–161.
Ewald, F. (1999). Genetics, insurance and risk. In T. McGleenan, U. Wiesing, & F. Ewald (Eds.), Genetics and insurance (pp. 17–33). Oxford: BIOS Scientific.
Graham, S., & Marvin, S. (2001). Splintering urbanism. Networked infrastructures, technological mobilities and the urban condition. London, New York: Routledge.
Hacking, I. (1990). The taming of chance. Cambridge: Cambridge University Press.
Harper, P. S. (1993). Insurance and genetic testing. Lancet, 341, 224–227.
Heath, J. (2007). Reasonable restrictions on underwriting. In P. Flanagan, P. Primeaux, & W. Ferguson (Eds.), Insurance ethics for a more ethical world, research in ethical issues in organizations (7th ed., pp. 127–159). Oxford: Elsevier.
Heimer, C. A. (2003). Insurers as moral actors. In R. Ericson & A. Doyle (Eds.), Risk and morality (pp. 284–316). Toronto: University of Toronto Press.
Hellsten, K., & Helne, T. (2004). Vakuuttava sosiaalivakuutus?. Helsinki: Kelan Tutkimusosasto.
Holm, S. (2007). Should genetic information be disclosed to insurers? British Medical Journal, 334, 1196. Retrieved April 27, 2009 from http://www.bmj.com/cgi/content/full/334/7605/1197.
Husted, J. (1999). Insurance, genetics and solidarity. In T. McGleenan, U. Wiesing, & F. Ewald (Eds.), Genetics and insurance (pp. 1–15). Oxford: BIOS Scientific.
Julkunen, R. (2004). Yhteiskunta vakuutuksena, vakuutus yhteiskuntana. In: Helne T., Hänninen, S., & Karjalainen, J. (Eds.), Seis yhteiskunta—tahdon sisään! (pp. 249–267). SoPhi 80: Jyväskylä.
Knoppers, B. M., Godard, B., & Joly, Y. (2004). A comparative international overview. In M. A. Rothstein (Ed.), Genetics and life insurance. Medical underwriting and social policy (pp. 173–194). Cambridge, MA: MIT.
Launis, V. (2003). Solidarity, genetic discrimination, and insurance: A defense of weak genetic exceptionalism. Social Theory and Practice, 29(1), 87–111.
Lehtonen, T.-K. (2009). The insured home as the foundation of society. Private insurance and everyday economics in Finland during the 1950s. In H. Johansson & K. Saarikangas (Eds.), Homes in transformation. Dwelling, moving, belonging (pp. 74–99). Helsinki: SKS.
Lehtonen, T.-K., & Liukko, J. (2010). Justifications for commodified security: The promotion of private life insurance in Finland 1945–1990. Acta Sociologica, 53(4), 371–386.
Liukko, J. (2010). Genetic discrimination, insurance, and solidarity: An analysis of the argumentation for fair risk classification. New Genetics and Society, 29(4), 457–475.
Maarse, H., & Paulus, A. (2003). Has solidarity survived? A comparative analysis of the effect of social health insurance reform in four European countries. Journal of Health Politics, Policy and Law, 28(4), 585–614.
May, L. (1996). The socially responsive self. Social theory and professional ethics. Chicago: University of Chicago Press.
McFall, L. (2007). The disinterested self. The idealized subject of life assurance. Cultural Studies, 21(4–5), 591–609.
McGleenan, T. (1999). Insurance, genetics and the law. In T. McGleenan, U. Wiesing, & F. Ewald (Eds.), Genetics and insurance (pp. 75–95). Oxford: BIOS Scientific.
McGleenan, T., Wiesing, U., & Ewald, F. (Eds.). (1999). Genetics and insurance. Oxford: BIOS Scientific.
Ollikainen, R. (2004). Yhteisvastuusta ja yhteiskuntavastuusta. In R. Järvinen (Ed.), Yhteiskuntavastuu. Näkökulmia yritysten ja julkisyhteisöjen yhteiskunnalliseen vastuuseen. Tampere: Tampere University Press.
Power, M. (2008). Organized uncertainty. Designing a world of risk management. Oxford: University of Oxford Press.
Rosanvallon, P. (1995). La nouvelle question sociale. Paris: Seuil.
Rosanvallon, P. (1999). Le capitalisme utopique. Critique de l’idéologie économique. Paris: Seuil.
Spicker, P. (1991). Solidarity. In G. Room (Ed.), Towards a European welfare state (pp. 17–37). Bristol: SAUS.
Squires, G. D. (Ed.). (1997). Insurance redlining disinvestment, reinvestment, and the evolving role of financial institutions. Washington, DC: Urban Institute Press.
Stjernø, S. (2004). Solidarity in Europe. The history of an idea. Cambridge: Cambridge University Press.
Stone, D. (2002). Beyond moral hazard: Insurance as moral opportunity. In T. Baker & J. Simon (Eds.), Embracing risk. The changing culture of insurance and responsibility (pp. 52–79). Chicago: University of Chicago.
Thiery, Y., & Van Schoubroeck, C. (2006). Fairness and equality in insurance classification. The Geneva Papers, 31(2), 190–211.
Thomas, R. G. (2008). Loss coverage as a public policy objective for risk classification schemes. Journal of Risk and Insurance, 75(4), 997–1018.
Tootell, G. M. B. (1996). Redlining in Boston: Do mortgage lenders discriminate against neighbourhoods? Working Paper Series No 96–6. Federal Reserve Bank of Boston, Boston.
UK Actuarial Profession. (2001). Responses to the ‘Whose hands on your genes?’ consultation. Retrieved Oct 18, 2010 from http://www.hgc.gov.uk/Client/Content_wide.asp?ContentId=390.
Van Hoyweghen, I. (2007). Risks in the making. Travels in life insurance and genetics. Amsterdam: Amsterdam University Press.
Van Hoyweghen, I. (2010). Taming the wild life of genes by law? Genes reconfiguring solidarity in private insurance. New Genetics and Society, 29(4), 431–455.
Van Hoyweghen, I., & Horstman, K. (2010). Solidarity matters: Embedding genetic technologies in private and social insurance arrangements. New Genetics and Society, 29(4), 343–350.
Wilkie, D. (1997). Mutuality and solidarity: Assessing risks and sharing losses. Philosophical Transactions of the Royal Society B Biological Sciences, 352, 1039–1044.
Acknowledgments
We would like to thank the organisers and participants of the ‘Insurance, Ethics and Corporate Social Responsibility’ workshop (Munich, February 2011), especially Aaron Doyle, Johannes Brinkmann and Bill Lesch for their comments on an earlier version of our manuscript. In addition, we gratefully acknowledge the suggestions of anonymous reviewers of the journal, as well as those of Paavo Pitkänen, the members of The Mole Research Group and the members of the Managing Insecurity project in Helsinki. The study was funded by the Helsinki Collegium for Advanced Studies and the Academy of Finland (decision numbers 129829 and 128334).
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Lehtonen, TK., Liukko, J. The Forms and Limits of Insurance Solidarity. J Bus Ethics 103 (Suppl 1), 33–44 (2011). https://doi.org/10.1007/s10551-012-1221-x
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10551-012-1221-x