Insurance…Why Can’t I Hedge my Health?

I am updating my ‘will’ /family trust and it is amazing how time flies. It feels like yesterday when I had to set this stuff up, yet Max is nowhere to be seen in the documents.

Much like options strategies and computers, the tax, insurance and legal jargon make me sleepy and feel dumb. But, like all these things, you CAN’T afford to be lazy.

I am 44 and have now needed Insurance 3 times (save a few fender benders that were NEVER my fault :) ). Two for lost or stolen goods and one for ‘fraud’ business insurance. Each time, I have been extremely fortunate to receive the coverage I believe I deserved. I have been extremely loyal to State Farm insurance and the two times they have had to ‘pay’, they have paid. NO HASSLES. Thank-you State Farm. I hear from others that they will not let there be a third time. I will let you know what I find.

In 2002, I was in trouble with my business (my than partner settled with the NASD), but Zurich Insurance covered the Fraud.

Health insurnace is a completely different story and each and every time I pull out my Blue Cross/Blue Shield card it feels like I am holding a scratch ’em lottery ticket. The card is just a tease. No matter how vigilant I am about coverage, it ALWAYS let’s me down. Luckily I can afford to just pay, but I can’t properly hedge my family’s health.

If we can have markets for stocks, bonds, equities and maybe even derivatives, should I not properly be able to hedge my family’s health.

PS – To snazz up my new will, I have decided to let the Stocktwits community decide if I should be pulled of life support systems. Be kind.


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  4. jonknight says:

    Howard you just hit on exactly why I have steadfastly refused health insurance. IMHO it seems to be a pig in a poke.

    As for stocktwits, I have a question that others might also share: I don't and won't trade in stocks as long as the market is this fracked. It's that reason alone that I'm not a member of stocktwits. I do follow the markets though, and I'm wondering, should I join stocktwits?

    If the answer is yes, then let me take this opportunity to preemptively suggest that you start looking around for the guys (if any) who are working on transferring human consciousness from a biological network to an electronic one a la 'Gateway'.

  5. I pay the first 10k for my family health insurance and treat it like
    catastrophe insurannce but what I pay never jibes with blue cross.
    They do this on purpose. Evil.

    Of course you should sign up for StockTwits if not just for me :)

    Gregor, fahmy, upsides takes, abnormal returns, emails


    CEO of and founder of

  6. sayemislam says:

    that would be cool, esp as more of our data is already out there. it just makes it interesting with obama's reforms and playing w/ tax money though.

    speaking of hedging i just finished reading “against the gods”, by peter bernstein – pretty awesome book, howard; check it out if you haven't read it already:

  7. You raise a good point about health insurance. First, many people out there talk about how happy they are with their coverage. But most people saying this are happy it covers pregnancy costs for their wife, prescription meds and a doctor's visit. All costs that are priced into your policy and non-catastrophic. I've heard very mixed stories from people that actually need the catastrophic insurance. I've heard stories of people battling with insurance companies while they are battling cancer. I've also heard positive stories of how the insurance company paid.

    My point is that many of us are lucky enough not to have major health issues. But those of us that have been lucky really have no clue on how that coverage will perform for the big stuff. So the people voting in these polls stating they are happy with their coverage really don't know. Just like I don't know.

    I also have concern for the entrepreneurs. If it is just you and perhaps a couple of employees, the insurance company doesn't really care about your business. On the other hand, if you are on the General Electric group plan they may not want to jerk around people and jeopardize losing the business if enough people complain.

    I'm purely speculating, but I tend to think you have an edge if you are covered through a big employer even if you have the same exact coverage through your own policy just because of the lack of business leverage over the company as a small outfit (or solo policy).

  8. sayemislam says:

    i'm not surprised phil – your poker playing last time said it all! haha

    hope you guys have been well

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