Invisible Bankers: Everything the Insurance Industry Never Wanted You to Know is a 1982 book on the insurance industry. It was written by financial journalist Andrew Tobias who became famous for his earlier book The Only Investment Guide You’ll Ever Need. It covers the financial details of life, auto, health and fire insurance — the types consumers normally buy. Because insurers are frequently the victims of insurance fraud, insurance companies need to be on their guard. In addition, an unscrupulous insurer could in theory make more profits if it could either induce their insureds into settling for less than they are entitled to or from outright wrongly denying valid clams in hopes that a small yet significant percentage would either get discouraged or wrongly believe that their claims were wrong. This makes dealings with insurers difficult. This book was the first guide to ordinary consumers into both the math and the business side of insurance.
The title refers to the fact that the insurance industry controls nearly as much money as the banking industry, yet remains essentially unregulated by the federal government and is haphazardly regulated by the states. Some argue that this may give the companies perverse incentives in their dealings. If one accepts the notion that the insurance system in the U.S. has misaligned incentives stemming from structural issues coupled with clumsy regulation, it is inferable that this could be a cause of high health care costs. Unfortunately, due to the asymmetric information that defines the industry (whether it be government controlled or privately controlled), no easy solution is available. The essential message of this book certainly needs more theoretical and practical exploration because health care is a significant near and long term issue.
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