The amount of available information, and the statistical ability to find patterns in it fundamentally alter risk pooling. This threatens to alter the structure of the insurance industry, and potentially to destroy insurability, as we will see. While too much information destroys risk pooling and rating, too little information, or one party with far more information than the other, likewise can destroy the structure of the industry. The regulatory implications, not yet understood, will be profound.
Citation:
Eric K. Clemens, Eric K. Clemens, Barry Blecherman, David Croson, "Information Technology and Information Asymmetry: The Future of Private Individual Health Insurance," hicss, vol. 3, pp.240, 30th Hawaii International Conference on System Sciences (HICSS) Volume 3: Information System Track-Organizational Systems and Technology, 1997