Insurance is accepting a small loss now (premium payment) to prevent a potentially larger loss in the future. If people take out a policy to protect themselves against a loss (such as theft), in a sense, People win if they are robbed. People were smart enough to protect themselves. On the other hand, if they paid the premium for 20 years and were never robbed, they still won because they transferred the risk at a small cost and gained peace of mind. Insurance is a way to transfer risk and worry to another so we come out ahead. No time is more important to transfer worry than when we retire.