Forms of Mutual Aid in the SNS Era

In October 2018, China's Alibaba Group launched a medical coverage service for its members, and in just one year, the number of subscribers surpassed 100 million. This is an astounding rate of growth. The most significant feature is that, unlike general insurance, no premium contribution is required at the time of enrollment; instead, after a claim occurs, the total amount of the benefit payment and administrative fees is "split" among the subscribers. Interestingly, the basic form of this system existed long before Yukichi Fukuzawa introduced insurance to Japan, and in Japan, it was known as Tanomoshiko or Mujin. In a sense, it can be said that an ancient system of mutual aid has been recreated within modern Social Networking Services (SNS).

To begin with, the function of insurance has its roots in "risk pooling." For example, let's assume two people, A and B, each have a 0.2 probability of encountering an accident resulting in a loss of 5 million yen (assuming the accidents occur independently). Now, suppose the two make an agreement that "when a loss occurs, the two will split it in half" (this is called "risk pooling"). When we are in the position of A (or B), most people would want to implement this agreement. In my field of expertise, people who make such a choice are called "risk-averse." Roughly speaking, through "risk pooling," the probability that both people encounter an accident and each must bear 5 million yen becomes 0.04 (0.2 x 0.2). Thus, the probability of extreme outcomes (a loss of either 0 yen or 5 million yen) decreases, creating a stable situation. "Risk-averse" people prefer this kind of situation.

When you think about it, no matter how much technology advances, human nature may not have changed since ancient times. For instance, if salaries do not change much, many people would likely prefer a more stable life. They are "risk-averse." There are many commentaries suggesting that Alibaba's new service is a threat to existing insurance. However, if we unravel it from the perspective of insurance functions, it is merely a "throwback" to its origins, and it is predicated on our universal human nature. By capturing this scientifically, we can think deeply about the essence of things that appear new at first glance. This is where the joy of "academic study" lies.