A No-Denial Insurer May Be Possible; No-Denial Mutual Aid Cannot Take a Single Step

One reason the online mutual aid model pioneered by KangAi Commune is regarded as innovative is that it puts participants face to face with one another, minimizing the role of the intermediary (the insurance company) as far as possible.

When you buy insurance, you don't feel that the payout you receive comes out of other policyholders' pockets, because the insurance company links both sides as the intermediary—you don't feel it, but that intermediary's presence is very strong.

In mutual aid, by contrast, the payout you receive is directly the contribution of other people—this is very visible—and the platform is merely an information matchmaker.

If an insurance company is willing to bear losses (or has other motives), it can afford not to deny claims. It doesn't need to explain to anyone—it only needs to be willing and able to carry the loss itself. Policyholders feel no pain. Indeed, many consumers may even be pleased at having taken advantage of the insurer.

But for mutual aid, not denying claims means, on the one hand, that if it violates the covenant it cannot explain itself to others, and on the other hand, that others are unwilling to put up the money. When someone takes advantage, whose wool is being sheared?

So many members don't understand why a mutual aid platform cannot operate like charitable donations. This is something they need to come to terms with.

When a mutual aid platform stops denying claims, don't celebrate too soon—it means your costs are about to rise enormously, and the platform is about to fold.