Just Roll, Already

I have been a lifelong player and fan of tabletop role-playing games (RPGs). Remember Dungeons & Dragons? Games like that. Heck, I even used to write them for a living for a few years, so that gives you an idea of just how deep my geek roots run.

The thing with role-playing games is that they are complex. Even the simplest RPG tends to have rules that are an order of magnitude more complicated than the rules of your average board game. Most RPG books are nothing but rules, and nowdays, they run more than 200 pages thick. I remember one author produced a 900-page sourcebook that was, quite literally, thick enough to stop a low-velocity bullet. But, this is part of their charm to their intended audience. RPG geeks like myself enjoy digesting all of these rules and figuring out how to interpret them when the game is played. Often this leads to the games themselves being dynamic, unpredictable affairs that ensure no RPG session will ever play out the same way twice.

The dark side of this, of course, are what are derisively termed “rules lawyers.” These are players who like to parse the rules so closely that they never get into the spirit of the game. Rather, their every involvement is akin to trying to get ahead by exploiting loopholes, or falling back on technicalities. Once, it seems clever. Twice, it seems persistent. Three times, and it’s rules lawyering. And while the rules lawyer might take pride in gaming the system as he does, it’s a real buzzkill for everybody else in the game. This is why rules laywers typically have short careers in any given gaming group. This kind of behavior is a pretty sure way to get uninvited to future games.

I bring this up because it hit me today while on the road, an argument in favor of the secondary insurance market, given to me by somebody from a life settlement company. He said that the big reaon why life insurers are so against the secondary market in general and life settlements in particular, is not because of concerns that life settlements are just a pretext to stranger-owned life insurance. And it’s not out of a concern to protect consumers from the kinds of abuses often attributed to the secondary market. It is because the secondary market business model exploits inherent weaknesses in how life insurance is traditionally underwritten.

“It’s not my fault the life industry is so stupid,” I was told. “They’re just mad that we’re taking the opportunities that they won’t stop presenting to us.” He was speaking about the relatively low surrender value of life policies that get outbid by life settlement companies, who buy about-to-be-surrendered policies, thus botching the retention model for insuers, who price their products based, at least in part, on assumed wash-out rates. Policies charging X for policies that are worth Y in benefits deliver the most value back to the insurer only if Z policyholders drop the policies at some point along the line, paying premium into the system without ever cashing out in some way, shape or form.