There's quite an interesting post over at Stumbling and Mumbling, which asks the same question.

Norm, the author of Stumbling and Mumbling, makes some particularly interesting points regarding adverse selection, moral hazard and our tendency to over estimate small probabilities. It's a great post in my opinion, and presents information from both sides of the fence without necessarily choosing a side. Good brain food for a Monday morning.

I won't reduce the gravity of the post with my ramblings; check it out here and let me know what you think.

[HAT TIP:] The Insurance Coverage Law Blog for the link to Norm's blog.