Insurance: An Ethnographic Account

Today, it seems to have become a truth universally acknowledged that any sound

thinking financial citizen in possession of a decent salary would necessarily require insurance

cover. Financial safeguards such as insurance, retirement savings, and investments are all forms

of risk management that aim to reduce the uncertainty that characterizes modern, urban life. The

financial logic of insurance has permeated not just corporations and businesses but also family

life and values. However, this also makes it a relevant time to reexamine the social and moral

changes that had to take place for insurance to become an acceptable and even a necessary aspect

of modern economic life.

As an undergraduate student yet to make my first taxable pay check, the idea of insurance

is hardly familiar to me. It was actually a chance conversation with a friend, Ankita (name

changed), which piqued my interest. She is an Economics major and was working on a paper on

the concept of moral hazard. We started talking about risk, economic and otherwise, and soon

she was telling me about the internship she had taken up at a health insurance firm a year ago.

She had worked on the product development team and told me about the ways in which policies

were crafted using consumer data that were bought from telecom and other companies.

Somehow, probably because of my limited acquaintance with the topic, the policies and working

assumptions that private insurance providers functioned on did not seem at all obvious to me.

After another conversation at our neighbourhood chai shop, I realised I had much more to think

about than I’d originally anticipated.

Insurance as a concept originated in the context of ancient trade and commerce, where

the uncertainty of trading ventures facilitated measures which could transfer the risk from

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merchants1. However, the contemporary forms of insurance have branched out from property to

include life, injury, health and body part insurance. As Zelizer has pointed out in the case of

nineteenth century America, the introduction of these various forms of insurance have not always

been smooth. In the case of the introduction of life insurance in America in the 19th century, the

concept created profound moral unease and social resistance (Zelizer, 1978). The idea of

equating an individual’s life with money was tantamount to desacralizing the value of human life

by appropriating them into the soulless logic of the market exchange system. Many people also

held the belief that taking out a life insurance policy was like gambling with death and with the

provident order of the universe. However, several changes in the social fabric, brought about by

urbanisation, the decreasing relevance of church and community; and advertising by personal

solicitation helped to legitimise life insurance towards the end of the 19th century.

Why is it important to understand the initial discomfort caused by life insurance when

there is hardly a salaried individual today who denies its logic? The world of premiums and

policies, riders and exclusions, co-payments and deductibles that Ankita gave me a glimpse into

seems far removed from 19th century America, and in many ways it is. But if we look closely, we

can still see the traces of the social structures and forms of consciousness that unsettle the

homogenous neoliberal understanding of insurance. Within the bounds of this understanding, it

becomes impossible to go about one’s daily business without the security of insurance, especially

in cities, where the lack of community and family networks is a major source of anxiety. Thus,

we may not be able to articulate forms of experiencing the world that are ‘pre-insurance’.

However, we can talk about ways in which insurance is appropriated to different ways of

1
Ray, R. M., 1941, Life Insurance in India: Its History, Law, Practice, and Problems, Allied Publishers.

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understanding the world and how the concept takes on different meanings in different contexts.

We can also try to understand how the categories and classifications of insurance providers

interact with the lived realities of people’s lives.

Insurance as Risk

Most definitions of insurance understand it as a form of risk management. Usually,

insurance is broadly classified into life and non-life insurance. Life insurance is a lump sum paid

out on occasion of death, while non-life includes health, property, fire, disability and many other

types of insurance. Insurance providers are constantly calculating risk or the probability of an

incident happening, and this calculation is what factors into determining appropriate plans and

premiums. In the case of health insurance, the calculation is based on the results of the medical

test that the applicants have to compulsorily undergo, usually conducted by the doctors affiliated

to the insurance company. In case of any congenital diseases, or tendency towards certain

diseases, the applicants are required to take certain ‘riders’, which are separate parts of the policy

specifically for such diseases, with premiums of their own. Riders can be taken out separately

even for diseases which require expensive treatment such as cancer2.

The way in which risk is calculated and accounted for in insurance policies almost makes

it a fictitious commodity in the way Guyer notes in her study on price (Guyer, 2009). Risk has

become so inherent a part of the compositional price of commodities that consumers often bear

the expense without realising it. The widespread distrust caused by rising oil prices in Nigeria

and the United States lead to increased public scrutiny on the compositional character of price.

2
Interview with Ankita

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According to Guyer, this is somewhat similar to E.P. Thompson’s description of the riots in

response to rising bread prices in pre-capitalist England. The rising prices were a breach of trust

and endangered the moral economy that had enlisted people’s support for the feudal system.

Similarly, the rapid increase in oil prices also signalled a breach of trust in government

institutions, and diverted public anger into uncovering the various elements that factored in to oil

pricing. The pervasive distrust we see in private insurance providers, both on the part of the

public and the government, shows a similar breach of trust in the institutions of capitalism. The

most evident expression of this distrust was in the nationalisation of insurance, which was

imposed in 1956. Private insurance companies were allowed to enter the market only in 20003.

The government clearly did not trust private, for-profit players to provide insurance at reasonable

premiums, reflecting a reluctance to hand over what was seen as a social responsibility to

capitalist institutions4. Even today, although most middle class people in urban areas apply for

insurance cover, there is a general mistrust that their claims will be recognised.5 Ankita seemed

to corroborate this view when she mentioned that a member of the company told her that Apollo

Munich Health Insurance made so much profit that even if they could not get a single new

customer in the next five years, they would stay comfortably afloat. However, when I asked her

about the people that could never afford insurance due to the high premiums which made up the

3
‘History of Insurance in India’, Affairs Cloud, Current Affairs Team,
https://www.affairscloud.com/history-insurance-india/

4Kamal Nayan Kabra, ‘Nationalisation of Life Insurance in India’, Economic and Political Weekly, Vol.
21, No. 47 (Nov. 22, 1986), pp. 2045-2053
5
With no health insurance, most Indians ‘burn up their savings to pay medical bills’, The Hindu: Business
Line, Dec. 5, 2017
http://www.thehindubusinessline.com/news/with-no-health-insurance-most-indians-burn-up-their-
savings-to-pay-medical-bills/article9983330.ece

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profit margins of these companies, she said that it was the government’s responsibility to take

care of that section of society.

The definition of insurance as risk management also makes it a question fraught with

religious complexities. In Islam, for example, insurance is considered haram, not only because it

can be seen as a kind of usury (payment of money for more money at a later date), but also

because it is often interpreted as a form of gambling or a transaction that is imbued with a level

of uncertainty, which are both haram according to the Quran6. By taking out an insurance policy,

one is therefore illustrating their lack of complete faith and trust in Allah’s plan (tawakkul). As

we have seen from Zelizer’s article, religious sanctions and cultural beliefs often provide

resistance to products like insurance that dangerously conflate the economic with the sacred and

the human. There is also a conviction that ‘all forms of commercial insurance are fraudulent

transactions aimed at consuming people’s wealth unjustly’, representing the same mistrust in the

capitalist system, which is exposed periodically in times of crises, as Guyer demonstrates.

Immediately, this becomes, in the wrong hands, another metric to demonstrate the ways

in which Muslims do not conform to the idea of the Indian citizen. Thus, in this one example, the

hegemonic nature of the normative conditions that insurance, along with other manifestations of

capitalism, impose on people becomes painfully apparent. I will explore the normative power of

a simple financial product like insurance in the following section.

Insurance as Norm

6
‘The True Nature of Insurance and the Rulings Concerning It’, Islam Question and Answer,
https://islamqa.info/en/8889

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 Like any other form of expertise, the business of insurance has more power than we give

it credit for. The fact that most insurance firms, especially life and health insurance providers,

have their own doctors who conduct check-ups on applicants is interesting because it indicates

how most insurance providers marry economic/financial expertise with medical knowledge in

order to craft their policies. Ankita also mentioned that mostly doctors occupied the highest posts

in the company. Thus, the importance of medical expertise in the insurance industry cannot be

underestimated.

A pertinent starting point into this issue is the fact that when insurance was initially

introduced in India, it was only available to Europeans and did not cover Indian lives at all7. This

reinforced the division between the colonial subject and the colonial official. Today, the

exclusions mentioned in health insurance policies reinforce similar social fault lines. Most health

insurance policies have exclusions, that is, circumstances in which claims for insurance cannot

be made. These include treatment for HIV/AIDS and other sexually transmitted diseases, mental

disorder and insanity, conditions arising from alcohol or drug abuse and weight control

treatments8. These exclusions clearly reflect the social biases of the policy makers. Thus, a

normative moral outline of the applicant is being articulated. It is clear that given these

conditions, several marginalised groups are discouraged from applying for insurance cover,

thereby furthering their marginalisation.

Insurance schemes also, through the terms and conditions of their policies, implicitly

regulate the ways in which people behave. The fact that any kind of risk seeking behaviour such

7
Ray, R. M., 1941, Life Insurance in India: Its History, Law, Practice, and Problems, Allied Publishers.

8
‘Optima Restore Individual’, Apollo Munich Health Insurance,
http://www.apollomunichinsurance.com/optima-restore-individual.aspx

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as excessive smoking, alcohol or drug abuse, and participating in adventure sports can make your

claim liable to be rejected, or can subject you to higher premiums, is an effective form of control

over insurance holders9. Insurance providers even try to positively reinforce certain types of

behaviours by applying special discounts on premiums, which can only be availed once the

applicant fulfils a certain condition, like hitting the target on the number of steps in a health app.

While Ankita defined this as mutually beneficial for both the insurance providers and policy

holders, it seemed to me that the implications of this form of control extended far beyond the

specific insurance policy.

Insurance and the Body

The human body is actually central to life and health insurance policies. Life and health

insurance articulate a conception of the body as merely a bearer of labour power. For example, in

insurance jargon, the ‘human life value’ is a measure by which life insurance policies are

created10. The ‘human life value’ represent the income of the person, their financial investments

and liabilities and often their family’s expenses. It is basically a monetary evaluation of the

person’s contribution to the family. The discomfort that Zelizer documents in nineteenth century

America also pivoted around the banality of receiving a cheque as a sort of replacement for the

loved one (“Every cent of it would seem to me to be the price of your life”). Thus, insurance

seemed to conceive of man as simply a bearer of abstract labour, a capitalist understanding of

human life that contradicts moral and religious sentiments even today.

9
Interview with Ankita.
10
‘Difference between Life and Health Insurance’, HDFC Life,
https://www.hdfclife.com/insurance-knowledge-centre/about-life-insurance/difference-between-life-and-
health-insurance/

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 A recent trend that viscerally embodies this idea is that of getting insurance for valuable

body parts. In recent years, several singers, sports players, and actors have insured the parts of

their bodies that they feel a large part of their income is dependent on. While many of these cases

could be publicity stunts, this trend represents a rather objective evaluation of the labour value of

parts of the human body11. The more ‘plebeian’ version of body parts insurance is the disability

or dismemberment insurance policy, which too insures certain body parts against accidents and

injuries. The valuation of some body parts over others seems to destroy the integrity of the

human body, and represents it as a labour machine.

What exactly is Insurance?

Insurance is quite difficult to classify as a gift, commodity or a debt as it consists of

elements of all these types of exchange. Insurance seems to be like any other commodity, as it is

usually bought and sold in the impersonal context of market exchange. However, many

insurance policies phrase it as a gift that one can give oneself or one’s family. Apollo Munich

Health Insurance even advertised their health insurance floater plans with the phrase ‘what could

be a better gift than protection for your dependents?’12 On the other hand, insurance also

represents the attempt to escape a situation of getting into personal debt, or of seeing one’s

family fall into debt. Insurance premiums and the eventual pay out can also be understood as a

sort of loan, which is repaid with interest (as we saw in the Islamic understanding of insurance as

usury).

11
‘4 Things You Need To Know About the Body Parts Market and Your Insurance’, Term Life
Insurance,
http://www.termlifeinsurancenews.com/blog/4-body-parts-market-insurance
12
Health Insurance Floater Plans: A Gift for the Family, Apollo Munich Health Insurance,
http://www.apollomunichinsurance.com/insurance-articles/health-insurance/a-gift-for-the-family.aspx

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 So how can we categorise insurance, or can we categorise it at all? We can make sense of

the varied understandings of insurance in different contexts of exchange through Margaret

Lock’s argument that objects do not have stable identities and can move between being gifts and

commodities over space and time (Lock, 2001: 316). However, although insurance companies

often attempt to advertise insurance plans by placing them outside the realm of economy and the

market (the gift) and in the intimate sphere of the family, there is little evidence to suppose that

insurance plans are genuinely given as gifts on family occasions. It is seen as the responsibility

of the breadwinner (usually the father in advertisements, thereby evoking the typical Indian

middle class family) to provide insurance for their dependents and the patriarch of a family is

always evaluated in his ability to provide for his family (Zelizer, 1978). Moreover, the fact that

an insurance policy can never be a personal reflection of the relationship it is meant to honour

due to its lack of distinguishing characteristics effectively prevents it from being given as a gift

in most Indian households. However, the fact that insurance providers attempt to couch

insurance in the language of the gift is an indicator of the fact that moral sentiments, while they

may not ensure that people actually buy the policy, certainly play a role in gaining the attention

of potential customers.

Thus, while we might otherwise understand insurance as a market commodity, the

various ways in which it is understood would preclude its classification as any one type of

exchange. Pinning it down as a commodity would make it far harder to see those traces of

meaning and morality that influence its appropriation in the Indian context.

Conclusion

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 I would not be surprised if this paper threw up more questions than answers about

insurance. The questions I hope to have raised require much more research and analysis. The

sociological literature so far has focused on understanding the reasons for the limited success of

social insurance schemes in developing countries. This question also figures, although obliquely,

in this paper. The attempts of capitalist instruments like insurance to codify and classify human

life for their purposes is repeatedly thwarted, especially in countries where insurance did not

emerge organically but was transposed.

This paper attempted to show the different ways in which insurance could be perceived.

One can approach insurance from several different points of view; from the perspective of

insurance agents, insurance providers, policyholders, those who oppose the idea of insurance, the

state. It would be useful to constantly keep in mind the question of who is making these policies,

what type of applicant do they have in mind and the demographic that is being excluded from

these policies. Does the transfer of money justify the ethics of governing people’s life and health

choices? Also, does the evaluation of risk in insurance cover presuppose the human body as a

labouring, or a docile body? When Mauss envisioned social insurance legislation as the state,

stepping in for the community and finally taking responsibility for the wellbeing of the worker

beyond just providing his wage; was he entirely off the mark? (Mauss, 1925)

For a cultural understanding, it would also be fruitful to see how insurance is depicted in

creative works such as novels, plays or stories. The figure of the insurance agent has become a

ubiquitous stereotype in popular culture (The Truman Show, Death of a Salesman, come to

mind). The way in which this figure managed to become a symbol of the monotony and banality

of modern life is also worth looking into.

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 Only further research can throw light on these questions and areas. For the purposes of

this paper, I have attempted to show how insurance has become a metric by which to assess our

place within the capitalist system. Just like the insurance agent, insurance itself is an

inconspicuous part of modern life that nevertheless defines several of our normative ideas about

citizenship and modernity. Therefore, work must always be done to properly contextualise

insurance within the context of its emergence and the mutations that it continues to undergo.

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