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this post was submitted on 28 Nov 2025
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The number of sick people also scales. The likelihood for 100 thousand sick out of 10 million is the same as 3 million sick out of 300 million.
What changes is the variation. If you have 10 people, it's possible that all are sick at the same time. All being sick is much less likely for 10 million and even less for 300 million.
An insurance company must have a certain size to handle variation but after that point a bigger size is not needed for that but can help with other properties.