&gt;  She finally did find a new insurer, but the price has gone way up -- negating her original claims.<p>This isn&#x27;t a scam at all. That&#x27;s exactly what you&#x27;d expect from insurance. Insurance isn&#x27;t there to save you money. In fact, the expected value of an insurance plan is <i>always</i> going to be negative on an infinite time horizon[0].<p>The whole point of an insurance plan is to <i>smooth risk</i>: instead of the small possibility of a catastrophic failure, you take the relative certainty of having a fixed monthly payment (your premium). At a very high level, it&#x27;s sort of similar to taking on consumer debt (credit card debt): in the long run, you&#x27;ll <i>always</i> pay more than if you just paid cash up-front, because of the interest. The difference between credit cards and insurance is that you don&#x27;t know when the expensive event is going to happen, so you agree to <i>always</i> pay the monthly payment regardless of what happens. And while banks charge interest based on the risk that you won&#x27;t pay back and the opportunity cost of that money, insurers charge you a premium in exchange for the luxury of not having to guess whether next month will have an expensive event or not.<p>In your friend&#x27;s case, the fact that she had two claims adjusted her relative risk profile, which means that her premium had to adjust accordingly.<p>[0] If it weren&#x27;t, there&#x27;d be no point to going into business as an insurer, because you&#x27;d be guaranteed to make an operating loss. The only way you&#x27;d be able to make any money is based on the investments that you make, at which point you might as well eliminate the insurance side of your business and operate as a bank. (Interestingly, this is why the relationships between banks and insurers are so close in many countries, and also why most insurance markets - car insurance and health insurance[1] being two notable exceptions - have surprisingly slim profit margins).<p>[1] Health insurance is a special case because, strictly speaking, it&#x27;s not really &quot;insurance&quot;, but that&#x27;s a whole separate discussion.