From Premium to Contribution: Recovering Solidarity

This post was originally written and published in French, De la prime à la cotisation: retrouver la solidarité

Well, let’s start with something everyone can observe. Insurance has a bad image, a bad press. It is often suspected of being a cold bureaucracy, a paperwork industry, a partner that looks for loopholes precisely when you need it. We talk about premiums the way we talk about a price, and we end up judging insurance the way we judge a purchase. Did I “get my money’s worth” this year. Did I “lose” money if I had no claim. Was I a good customer if I kept quiet. With questions like these, the very idea of solidarity quickly feels out of place.

And yet, if we set aside the forms and the marketing campaigns, insurance is first and foremost a social technology. It makes a simple reality livable. Some events are rare, hit hard, and cannot be financed individually without tipping into ruin. Insurance says the following. We do not know when, we do not know who, we only know that one day someone will have an accident, fall ill, see their home damaged, or cause harm to someone else. And because we cannot decide in advance who that person will be, we choose to be many to carry the associated financial burden. We pool a small share of our resources, and we agree on rules so that, when the day comes, the burden is bearable. For everyone. It is not only a service, it is a common.

I had already tried to look at the issue from a concrete angle, the angle of claims settlement, and the way it can disenchant a tool that is, in principle, virtuous, in an earlier post When insurance falls apart, the silent crisis of claims settlement. And there are other posts too, revolving around pricing, perception, and what we truly expect from an insurance contract, such as The value of life, The paradoxes of segmentation and discrimination in insurance, Cheaper personalized insurance premiums thanks to AI, or Insurance, a zero sum game. But what was missing was a broader lens, more sociological, and probably more political too. And as often, going back to classic works in the social sciences helps clarify what is at stake.

The Shift Described by David Riesman

In 1950, in The Lonely Crowd, David Riesman describes a shift in social character. We move from a model in which people advance with an internal compass acquired very early, shaped by family and by the norms of one’s milieu, to a model in which people continually adjust to signals sent by others, by peers, by the public sphere, and by mass culture. David Riesman links this change to a society that moves from the horizon of production to that of consumption, and to individuals who become more attentive to other people’s preferences, because social integration depends more on acceptance, comparison, and the ability to tune oneself to a moving environment.

I think this description sheds light on an insurance paradox. Insurance needs a collective, trust, and a willingness to accept that a mechanism can be good even when it does not serve me immediately. Yet constant adjustment to social signals pulls in the opposite direction. It pushes us to compare, to optimize, to demand personal justification, to turn any contribution into a transaction, and any transaction into a score. It pushes us to live protection as an individual product, not as belonging. This points to something fairly deep. In the “other directed” universe David Riesman describes, value must be readable in clear signals, quick feedback, and implicit rankings. Insurance, for its part, has a value that is hard to see, because it shows up mostly when it is missing, when it fails, or when it comes into conflict with a singular case. As people often say, it collects in calm times and pays in times of drama.

Premium and Contribution

In this world, we no longer “contribute”, we pay our premium. “Paying a premium” tells a story of customer and seller, whereas “contributing” tells a story of member, collective, group. The first framing emphasizes price and contract. The second emphasizes the link and the shared rule. And if solidarity no longer speaks to us, it may not be because it has disappeared, but because we have lost the rituals and the staging that make it tangible.

In Habits of the Heart, Robert Bellah, Richard Madsen, William Sullivan, Ann Swidler, and Steven Tipton describe a similar dynamic. What they call individualism, which they consider a central moral value in the United States, celebrates independence and personal responsibility, and leaves little room for recognizing interdependence. They also note a paradox. Individualism was sustainable only because it rested on other moral traditions, more oriented toward the common good, but less valued. Inevitably, this creates tension. On the one hand, insurance embodies interdependence. On the other, it is sold, compared, rated, and canceled like a product. When the second view prevails, the first becomes suspect. We want to pay for ourselves, and above all not pay for others. We want pricing that promises justice down to the cent, as if fairness meant matching each individual as closely as possible, rather than organizing a workable fairness among all.

Pricing Fairly or Holding Together

In my classes, or in technical talks, I often tell students and actuaries accuracy is overrated. This is not a rejection of measurement. It is a warning, to keep people from choosing the wrong metric. Actuarial work serves a promise, and that promise is not to assign an individual destiny. A premium is not a verdict on a person. It is an instrument for making a common work. Even when we talk about actuarially fair pricing, we sometimes forget that actuarial work operates on classes, not on individual destinies. I insist on this because the slip matters. A society obsessed with signals can quickly confuse a price with a moral evaluation.

That is also why, in mutual insurers, people rarely speak of premiums and instead always speak of contributions. The word reminds us that we do not pay only for ourselves. We pay to make a mechanism possible. We pay so that the promise holds, including when it applies to someone else today. Contribution says that justice is not reduced to an instant individual equivalence. It includes the idea of a we, and it makes that idea workable.

In Bowling Alone, Robert Putnam popularizes the idea of social capital, those networks, norms, and trust that make cooperation possible. Insurance turns trust into financial capacity. It takes a social promise, “we will be there when misfortune strikes”, and translates it into rules, reserves, pooling, and procedures. When social capital declines, that kind of promise becomes harder to believe, harder to administer, and harder to defend. We no longer see a common that makes life possible. We see a levy that eats into the budget. And because the value of the common is diffuse, criticism is easily reframed in consumer terms. If I have no claim, I get nothing. If I do have a claim, I discover conditions, deductibles, limits, delays. Insurance then feels like a cold relationship. Not necessarily because the rules are bad. But because a world of premiums makes us forget what it means to contribute.

Personalization That Eats Away at Solidarity

We live in an era that loves personalization, I wrote about it this summer in cheaper personalized insurance premiums thanks to AI. More data means more segmentation, and more promises that each person will pay exactly what they deserve. Who could object. This fits David Riesman’s intuition in The Lonely Crowd, that need for validation through comparison, that sensitivity to gaps, that anxiety about being treated as an anonymous member of a group. But this appetite for personalization comes with a collective cost. The more we segment, the more we shrink the domain of sharing. At the limit, if we could know individual risk perfectly, there would be almost nothing left to pool. Insurance would become forced savings, a disguised personal account, with management fees and exclusions. We would have lost the ability to keep together lives that are unequally exposed to chance.

In Liquid Modernity, Zygmunt Bauman describes a modernity in which ties become more reversible, more fragile, and in which the balance between security and freedom shifts, often at the expense of collective security. Extreme segmentation resembles that logic. It maximizes a certain individual freedom, the freedom not to carry others. But it weakens shared security, the kind that prevents a shock from pushing you out of social life. In The Corrosion of Character, Richard Sennett shows how flexibility, discontinuity, and long term uncertainty undermine the capacity to plan ahead, to commit, and to sustain long term promises. Insurance is a long term promise, sometimes a very long term one. It requires accepting to pay for years without daily proof of “value for money”. When that time horizon feels alien, the contribution turns into a premium, then the premium turns into an unfair bill, and the contract becomes a relationship one tolerates without recognizing.

When the Market Meets Its Limits

In The Great Transformation, Karl Polanyi describes the movement by which vital dimensions of social life are treated as commodities, and the counter movement by which societies reinvent protections, because a life fully delivered to the market becomes unlivable. We can read modern insurance as one of those protections. An institution that stabilizes existence in the face of risks, and that prevents everything from dissolving into charity, private debts, or biographical catastrophes. But that would be too simple, because insurance clearly operates in a gray zone. It is a protection, but it is sold on a market. It must be solvent, but it must also be acceptable. It must manage incentives, but it must also retain moral meaning. It must set prices, but it deals with things that do not reduce to prices. And the more we push market logic, the harder it becomes to defend the common, because we change the criteria by which the system is judged.

In Pricing the Priceless Child, Viviana Zelizer shows how societies transform what they deem priceless while still assigning it forms of price, compensation, and insurance. Child insurance, for instance, becomes a terrain where economics, morality, and emotion collide, and where institutions are invented to make a loss that has become “priceless” bearable. In other words, insurance is not only an answer to a risk. It is a mirror of what we consider owed, acceptable, and worthy of being shared. In The Moral Economy of the Peasant, James Scott insists on expectations of minimal security, grounded in norms of reciprocity and a practical idea of justice. Without mechanically transposing that world, the intuition is valuable. A community holds because it organizes safety nets, because it refuses to let chance alone decide who falls and who gets back up. When these nets become invisible, we rediscover the violence of chance, and we then fight about who should bear the cost. Insurance is precisely the art of avoiding that fight upstream, by giving solidarity a stable form.

Three Scenes Where the Common Returns

Take auto insurance. For a long time, it looked like an imperfect but legible pact. Simple rules, a few variables, a bonus malus system. Then came the dream of bespoke pricing. Devices, apps, telematics, the promise to measure “real” driving. The pitch is always the same. You will pay as you drive. This pitch fits a society described by David Riesman in The Lonely Crowd. When you live under permanent comparison, you tolerate being put into a group poorly. You want your singularity recognized. But insurance is not a contest. Auto risk is not reduced to driving style. There is everyone else on the road, the weather, the unpredictable, fatigue, timing. Above all, there is the share of accident that escapes any meritocratic story, and it is immense. Telematics can help reduce some accidents, and that is valuable. But it also changes the relationship to the contract. The contract becomes a continuous production of proof, a score. And once the score becomes central, contribution becomes illegible again. Why share with those who do not have my score. Why not pay exactly for what I do. When that question becomes central, the shift has already happened.

Health is even more revealing. As soon as we push personalization, we hit a moral boundary. We no longer say only “I pay for my risk”. We say “I pay for my body, my history, my vulnerabilities”. We then ask society to ratify a harsh idea. Those who are less lucky will pay more, or be covered less. This is perfectly coherent from a market point of view. But it is explosive from the point of view of the common. And it is no accident that societies sooner or later invent explicit solidarity mechanisms around health.

Finally, some risks stubbornly refuse personalization. Natural disasters are perhaps the clearest example. We can segment, map, modulate. But once an event exceeds a certain scale, the entire system is challenged. Claims concentrate, costs add up, and the very idea of purely private coverage becomes fragile. Risk becomes common again, literally. And we observe a constant phenomenon. Even those who most readily speak the language of markets return to the language of the common when the shock hits. We talk about pooling, funds, public guarantees. Solidarity returns, not as a virtue, but as a necessity. A related discussion can be found in our article with Laurence Barry, In the end, who will bear the cost of insurance.

A Common Must Be Governed

If insurance has a bad image, it is not only because it is expensive. It is also because it concentrates a kind of conflict we tolerate less and less, the moment a collective rule applies to a singular case. We can complain about delays, but what really hurts is the feeling of being reduced to a box when you are living something unique. And because insurance touches bodies, homes, deaths, accidents, it touches things that cannot easily be absorbed by a counter logic.

The image of insurance is shaped less in the years when nothing happens than in the hours when something happens, and two narratives collide. The insured’s narrative says I experienced a rupture and I expect support. The insurer’s narrative says I apply a shared rule so that the promise holds for everyone. If the rule is incomprehensible, or if it looks designed to escape, the common cracks. If the rule is understandable, if the decision can be contested, if the procedure feels fair, then even a refusal can be absorbed without breaking trust. It is at this very concrete level that contribution becomes a political question in the simplest sense of the word.

A premium invites me to calculate what I receive. A contribution invites me to look at what we make possible. As long as insurance is told in the language of the premium, it is condemned to be evaluated with the criteria of a purchase. And by those criteria, it almost always disappoints, because the best case in insurance is the one where nothing happens and yet you have paid. Coming back to the word contribution is learning to describe the object correctly. Saying contribution when the logic is genuinely mutualistic is not marketing, it is a clarification. We do not pay for our future claim, we contribute to a shared continuity. In the society described by David Riesman, still in The Lonely Crowd, where evaluation by comparison becomes almost automatic, that shift is difficult. But it is the shift that can reconcile insurance with its function.

If we want to recover solidarity, we may have to stop selling it as an emotion and start describing it as an architecture again. Insurance, when well designed, says something simple. We accept not to let chance decide alone. We accept that vulnerability is not a fault. We accept that part of our resources should serve to maintain the continuity of lives when they tip. But that requires leaving this lonely crowd, and recreating a collective.


OpenEdition suggests that you cite this post as follows:
Arthur Charpentier (February 6, 2026). From Premium to Contribution: Recovering Solidarity. Freakonometrics. Retrieved March 5, 2026 from https://doi.org/10.58079/15n8z


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