Insuring Life: Value, Security And Risk [1st Edition] 0415716071, 9780415716079, 1138729280, 9781138729285, 1315880229, 9781315880228, 1134743912, 9781134743919

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‘Insuring Life is a state-of-the-art intervention in the debates on the nature of the governing of life as uncertainty. Combines a breathtakingly detailed analysis of life insurance with a fresh philosophy of the event.’ Professor Louise Amoore, Department of Geography, Durham University, UK ‘Insuring Life is far more than an ironic twist on “life insurance”. The third volume of Lobo-Guerrero’s brilliant trilogy on insurance as governance, by refusing to take life for granted, shows how insurance practices constitute vitality itself, creating, shaping and sustaining life.’ Professor J. Peter Burgess, Ecole Normale Supérieure, France

Praise for previous volumes in the trilogy: ‘Insuring War does much more than show how important practices of insurance were to the development of modern warfare and security. Historically rich and theoretically sophisticated, the book demonstrates the central importance of the Probabilistic Revolution and secular risk calculation to the very possibility of sovereignty and modern statehood. Highly recommended to students of International Relations and International Political Economy alike.’ Marieke de Goede, Professor of Politics, University of Amsterdam, the Netherlands ‘Lobo-Guerrero’s Insuring War is, first and foremost an important contribution to political thinking. Eschewing the traditional framing of violent conflict that foregrounds executive decision-making, arms races, and geopolitical alliances, Insuring War makes evident that what is central to the politics of deadly engagements is “the concerted art of managing uncertainty.”’ Michael Shapiro, Professor of Political Science, University of Hawai’i at Mãnoa, USA ’Luis Lobo-Guerrero is what I consider to be one of the foremost scholars in International Relations and specifically Critical Security Studies. Inspired by Michel Foucault’s analytics and methods and forming part of a triptych devoted to insurance and security, Lobo-Guerrero provides in this volume a fascinating and original investigation into insurance and its uses in time of war.’ Vivienne Jabri, Professor of International Politics, King’s College London, UK

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Insuring Life

This book is a contribution to the scholarly engagement with the wider problem of governing through risk and the politics of uncertainty. It takes life insurance as an empirical site from which to ask: what is the kind of governance created through insurance an instance of, and how does it contribute to the transcendence of liberalism? By making a distinction between capable life as object of insurance, and potential life as that which escapes its control, the book conducts a historical epistemological analysis of the problems of valuation, truth production, securitisation, classification, and gendering that constitute life insurance products and practices. Insuring Life offers a critical engagement with the epistemology of life insurance to demonstrate the unnecessary and precarious character of the conditions that make this instrument of liberal governance possible. It concludes that the transcendence of liberalism relies on the technological agency of these instruments and that its challenge begins by redefining the terms under which the potential of life, if invaluable, is to be thought as event. The book follows Insuring War as the third of a trilogy that analyses how concepts and practices of power, risk and security materialise in the form of insurance as a central instrument of governance in the liberal world. It will be of great use to scholars, researchers, and postgraduate students of political economy, critical security studies and political theory, the biopolitics of security and post-structural politics. Luis Lobo-Guerrero is Professor of History and Theory of International Relations at the University of Groningen, the Netherlands. He is the author of Insuring Security: Biopolitics, Security and Risk, and Insuring War: Sovereignty, Security and Risk.

Interventions Edited by: Jenny Edkins, Aberystwyth University and Nick Vaughan-Williams, University of Warwick The series provides a forum for innovative and interdisciplinary work that engages with alternative critical, post-structural, feminist, postcolonial, psychoanalytic and cultural approaches to international relations and global politics. In our first 5 years we have published 60 volumes. We aim to advance understanding of the key areas in which scholars working within broad critical post-structural traditions have chosen to make their interventions, and to present innovative analyses of important topics. Titles in the series engage with critical thinkers in philosophy, sociology, politics and other disciplines and provide situated historical, empirical and textual studies in international politics. We are very happy to discuss your ideas at any stage of the project: just contact us for advice or proposal guidelines. Proposals should be submitted directly to the Series Editors: Jenny Edkins ([email protected]) and Nick Vaughan-Williams ([email protected]) ‘As Michel Foucault has famously stated, ‘knowledge is not made for understanding; it is made for cutting’. In this spirit the Edkins–Vaughan-Williams Interventions series solicits cutting edge, critical works that challenge mainstream understandings in international relations. It is the best place to contribute post-disciplinary works that think rather than merely recognize and affirm the world recycled in IR’s traditional geopolitical imaginary.’ Michael J. Shapiro, University of Hawai’i at Mãnoa, USA

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On the Greek Origins of Biopolitics A reinterpretation of the history of biopower Mika Ojakangas Insuring Life Value, security and risk Luis Lobo-Guerrero The Global Making of Policing Postcolonial perspectives Jana Hönke and Markus-Michael Müller Cultural Politics of Targeted Killing On drones, counter-insurgency, and violence Kyle Grayson Europe Anti-Power Ressentiment and Exceptionalism in EU debate Michael Loriaux Refugees in Extended Exile Living on the edge Jennifer Hyndman and Wenona Giles

Insuring Life Value, security and risk

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Luis Lobo-Guerrero

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First published 2016 by Routledge 2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN and by Routledge 711 Third Avenue, New York, NY 10017 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2016 Luis Lobo-Guerrero The right of Luis Lobo-Guerrero to be identified as author of this work has been asserted by him in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging in Publication Data Names: Lobo-Guerrero, Luis, author. Title: Insuring life : value, security and risk / Luis Lobo-Guerrero. Description: Abingdon, Oxon ; New York, NY : Routledge, 2016. | Series: Interventions | Includes bibliographical references and index. Identifiers: LCCN 2016002223| ISBN 9780415716079 (hardback) | ISBN 9781315880228 (ebook) Subjects: LCSH: Life insurance. | Risk (Insurance) | Value. Classification: LCC HG8771 .L58 2016 | DDC 368.32–dc23 LC record available at http://lccn.loc.gov/2016002223 ISBN: 978-0-415-71607-9 (hbk) ISBN: 978-1-315-88022-8 (ebk) Typeset in Times New Roman by Taylor & Francis Books

To Sebastian

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Contents

Preface

xvi

The book cover

1

1

Introduction: Life insurance and the politics of vital uncertainty

2

2

The problem: The technological transcendence of liberalism

21

3

Insuring the life excess

35

4

Capital securitisation: an emerging order in the valuation of life

54

5

Uberrima fides, trust and contracted life

72

6

Sex, insurance and the valuation of lives

88

7

Life beyond insurance, life as the potential of becoming

108

8

An epistemology of life insurance

121

Bibliography Index

136 150

Preface

This book is the third volume of a trilogy devoted to the study of insurance as an instrument for liberal governance. It follows Insuring Security: Biopolitics, Security and Risk (2011), and Insuring War: Sovereignty, Security and Risk (2012). The volumes have been organised around the analysis of the implications of using insurance to create security, sustain war, and promote and secure life in the modern period together with the biopolitical, sovereign and value effects of doing so. The first volume argued that insurance operates a security technology central to the development of liberal life within and beyond liberal economies. While ascribing value to life, insurance capitalises livelihoods and promotes lifestyles. The second book was organised around the idea that insurance, as a central, if ignored, instrument of war in the modern period, expresses a form of politics, an insurantial sovereignty that results from the marriage of practices of statecraft with practices of risk. This third volume posits the thesis that insurance, by valuing life in terms of capability, which is then securitised and capitalised in the global financial markets, constitutes a central technology for the transcendence of liberalism. Thinking of insurance as an instrument at the core of the liberal capacity to generate security, wage war, and create value, challenges a well-established tradition of thought that focuses on the role of agency and structure when reflecting on ideas of order, power and governance. This tradition, deeply anchored in the canon of Political Science and International Relations, can be exposed, however, to the possibility of thinking order, power and governance, not as assets, aspirations, or accomplishments, but as constituted through discourses and practices and the very terms that make them possible. Life insurance is one of those practices, an innocent one in appearance, but one that is complicit in the crafting of liberal subjectivities, the formulation of liberal temporalities, and the governance of liberal spaces through the creation and operation of markets. By detailing the performative character of instruments such as insurance in the making of liberal life, it is possible to uncover the unnaturalness of such life and its possibility of being otherwise. In that context, Insuring Life is not a book but a problem space that seeks to expose the unnecessariness and the insufficiency of liberal regimes. Its

Preface

xvii

writing has been but a thinking device with which to reflect on how the very ways in which life is defined imply the ways with which it is to be promoted and protected. This is done at the exclusion of alternative forms and dimensions of vitality. The book is therefore not a treatise on life insurance. Nor does it offer a sociology on this instrument. Taking life insurance as an empirical site, it asks how is it an instance of particular features of liberal governance and how does it express the transcendence of liberalism (see Chapter 2). Those interested in knowing more about the history and sociology of life insurance are advised to consult the excellent work of Zelizer (2007, 2010, 1983, 1978), Daston (1988), O’Malley (2004), Chan (2012), Alborn (e.g. 2001), Clark (1999), the edited work of Baker and Simon (2002), and that of Ericson, Doyle and Barry (2003), to name but a few. The writing of a trilogy of books is an experience of deep and protracted reflection where the author’s modes of reasoning emerge, develop, grow and are actively challenged. Whereas the first two books emerged out of a research attitude of curiosity about the works, operation, and implications of insurance in the liberal world, this third volume is the result of a wondering about the very existence and persistence of insurance as an instrument for liberal governance. The distinction between these two modes of reasoning is central to the argument of the book and is discussed in Chapter 2. Suffice it to say here that curiosity allows for a logical understanding of how systems of thought are made to work, how they operate, and how they fail. Wondering opens up the possibility to interrogate the very rationality that supports such systems and to challenge them on the terms on which they have been formulated. Whereas the former falls within the realm of the social and human sciences, the latter can be taken to be a philosophy of an experience of knowledge and power, what is here referred to as a historical epistemology. Insuring Life begins with an unconventional initial chapter, its book cover (Chapter 0). Its design was part of the project and involved an intense dialogue between Carlos Gomez, a designer based in Barcelona and myself as author. During a period of almost a year my task was to convey to him what the book was about and his task was that of depicting what his imagination took that to be. Over months, his sketches evolved into what is presented here and has operated as a continuous source of inspiration. The life that could be felt but not seen played a role in amplifying the crude calculability and valuation to which liberal life is continuously subjected. The role of the horizon, mentioned in Chapter 0 and developed in Chapter 8, gave credence to that which exceeds the commodification of life and yet makes it worth living: its passions, its imaginations, and its productive irreverence. Insuring Life should therefore be approached in a poetic spirit. One where the strictures of the text do not convey a strict meaning but act as springboards for an imagination of a life not yet subjected, or not completely so, to liberal governance. This book has been written in nomadic style. In the intermezzo spirit alluded to by Deleuze and Guattari (1987), the thought underlying this work is

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Preface

the result of a life of interstices and discontinuities. A liberal life, nonetheless, where the daily minutiae of multiculturalism at the family dining table are a continuous reminder of the precariousness of concepts, borders, structures and histories. This monograph began to be written in the winter of 2011, from close to London while on sabbatical leave from Keele University and as visiting fellow at King’s College London. Writing and thinking continued in the spring of 2012 during a visiting professorship at the Institute for Sociology at the University of Hamburg, where exposure to a slower but deeper continental way of reasoning order and power challenged my, by then, very Anglicised way of understanding governance. Between the summer of 2012 and the spring of 2013 I took an appointment at Royal Holloway, University of London which meant a weekly commute from Hamburg where the family was then located. It also constituted an exposure to a weekly contrast between different forms of liberalism and ways of understanding and managing risks, from the airports themselves, to the character of students. Since April 2013, writing took place from the institutional comfort and intellectual collegiality of the University of Groningen where I took an appointment as Professor of History and Theory of International Relations. The last seven months of writing involved an almost daily crossing of the German-Dutch border to our house in the East-Frisian city of Leer, in Germany. Roaming between and within liberal environments of different kinds keeps one’s mind under continuous attention to the detail of how technologies of governance constitute subjectivities, which, if apparently similar, result from very concrete ways of problematising and operating the uncertainties of life and constitute very particular kinds of subjects. As work, this book has not been a solitary experience. I would like to acknowledge the generous time and help from numerous life insurance industry officials and consultants who on the condition of anonymity contributed material and advice for the writing of the story in Chapter 1, and Chapters 3, 4, 5 and 6. Colleagues from my time at Keele University, Barry Ryan, Ronnie Lippens, Peter Adey, Barry Godfrey, contributed generously to the early stages of this project. Sven Opitz, Ute Tellmann, Urs Stäheli, and Susanne Krasmann at the University of Hamburg widened my understandings of governance and liberalism. Sandra Halperin, Chris Rumford, Henry Sommers-Hall and especially Nathan Widder at Royal Holloway, University of London, provided crucial help with historical and theoretical issues. At Groningen, Benjamin Herborth, Jaap de Wilde, Nadine Voelkner, Suvi Alt, and colleagues at the Chair Group on History and Theory of International Relations were generous with their comments, support and time. Special thanks go to Mike Shapiro, Mick Dillon, Mark Duffield, Pat O’Malley, Melinda Cooper, Marieke de Goede, Peter J. Burgess, Louise Amoore, Jean-Christoph Graz, Paul Langley, Ignacio Mendiola, Oliver Kessler, Joscha Wullweber, Florian Kuhn, Jana Hoenke, Mark Salter, Martin Coward, and the editors of this book series, Jenny Edkins and Nick Vaughan-Williams for their intellectual generosity and support. My students at the research seminar

Preface xix ‘Governing Through Risk and the Politics of Uncertainty’ between 2013 and 2015 deserve mention for having patiently endured my rehearsing on them some of the difficult ideas of the book. Special thanks go to my students Anna Stobbe and Corey Walker-Mortimer who, without knowing it, have been a great source of intellectual inspiration. Finally, such work is only possible through the peace and support that families provide. My deepest gratitude goes to Nadine, Max and Sebastian for their loving sacrifice in time and care. The book is dedicated to our son Sebastian who was born during the last months of writing. Parts of Chapter 4 were previously published in 2014 as ‘The Capitalisation of “Excess Life” through Life Insurance’ in the journal Global Society, 28(3), 300–316. I acknowledge the kind permission of Taylor and Francis for granting the license to reuse this material. Parts of Chapter 5 were previously published in 2012 as ‘Uberrima Fides: Foucault and the security of uncertainty’, in the International Journal for the Semiotics of Law, 26(1), 23–37. I acknowledge the kind permission of Springer Science + Business for granting the license to reuse the material. The Leverhulme Trust supported the writing of this book by funding the project Capitalising Security Through Life Insurance in the United Kingdom, grant number F/00 130/Q, between February 2011 and January 2013. I hope the book will contribute to the scholarly engagement of what it means to govern through risk and the politics of uncertainty involved in the process. Luis Lobo-Guerrero Leer (Ostfriesland), Germany

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The book cover

A life wanders on a plane. Not any life, one expressed in terms of capability; a calculable present life. The plane wandered upon is precarious, undefined, and unstable. Its instability is the result of uncertain scientific foundations, forms of knowledge under continuous transformation, challenge and change. The wandering life is driven and seduced by an idea of certitude that operates a horizon. As horizon, it retreats as one advances. Keeping the life under a state of continuous wandering constitutes its value and the possibility of profit. Whilst setting the terms for such wandering, valuing the life, insurers’ power is used to create wealth. The plane on which the life wanders, its context and depth, constitutes a world. One that assumes subjects as interest-driven, thirsty for profit and opportunity. The wandering life is, however, not alone. Neither is its plane. It is but one life in a multitude. In the shadows, and without a plane, there is an unidentifiable life that leaves a trace. It floats. It is life in potentiâ, potential life.

1

Introduction Life insurance and the politics of vital uncertainty

Nathalie was left with the impression that her life was worthless. That was, in more polite and legal terms, what the letter she held in her hands stated. Years before she had married for love and given birth to a child who was now three. Just recently she had published her third academic book and had received confirmation of her tenure as university professor. Her new position allowed her to concentrate on developing some promising intellectual projects she had been postponing for years. Her view on the future was very positive; she had a lot to look forward to. The tenure meant a lot to Nathalie as well as to her husband, a talented professional cello player who made a living out of short-term performance contracts. With her secured career they were now in the position to apply for a mortgage to buy their first house, a dream of theirs ever since their son was born. Because payments on the loan would rely almost entirely on her income, the bank requested an added security. They asked that together with a 30 per cent deposit on the price of the house her husband took a life insurance policy on her life amounting to a third of the value of the property. The policy would be payable to the bank in case of illness preventing her from working or premature death. It was a way for the lender to offset the risk that Nathalie represented to them. As Nathalie’s financial advisor told them, this was a normal procedure and a common market practice. Getting such a policy should be an easy matter. In the process of applying for the mortgage, however, Nathalie started to feel ill. She began to experience numbness in her extremities, something she had never had. After numerous medical examinations her doctors diagnosed her with an autoimmune disease which they did not know much about. All they knew was that it was degenerative, not fatal, but very likely to create disability. The diagnosis took place just after their financial advisor had made, on their behalf, the application to the life insurance policy. After submission, the application had followed the normal underwriting protocol established by the insurer. Because of the size of the mortgage the underwriter required more detailed information on Nathalie’s health and requested a medical statement from her personal doctor, she had agreed to this in the application form. The doctor was asked to complete a form and

Introduction

3

send it to one of the company’s medical officers. The purpose of this added request was to learn more about the client’s particular conditions, a form of micro underwriting that would help them identify the level of risk posed by Nathalie. In the report, the doctor disclosed her condition and based on this information the insurer’s medical officer advised the company’s actuary on the possible implications of her disease for her future capacity to work. The actuary then calculated the risks of the case and calculated the costs of offsetting them against the premiums they would collect from her. He then passed on this information to the underwriter who could offer a loaded premium to represent her heightened level of risk or deny cover altogether. The letter Nathalie now held in her hands specified the latter. It stated that given her medical circumstances the insurance company was not prepared to offer her life cover. This did not automatically turn her into an uninsurable client. According to her financial adviser it could be possible to find cover offered by companies specialising in cases such as these. They operated on a different business model by placing a large number of clients similar to Nathalie in a special risk pool and charging them a loaded premium. In so doing they could offset the losses they were likely to incur in insuring these risks. The higher premiums compensated for the higher risks. Nathalie’s feelings about this situation were mixed. As a result of her diagnosis, she now found herself living an uncertain present with a precarious future. Her life, which she had understood until then as pretty normal, was now a life classified by insurers as a ‘special risk’. Standing out in such a way had not figured in her plans. Apart from her and her family’s concerns about her health, not being able to secure cover on her life through a life insurance policy, or not being able to do so at affordable prices, would either deny them the guarantee required by the bank as a condition for the loan or limit what the policy would cover. Without having other property to use as collateral, they could now be ineligible for credit. Another option would be to find a guarantor to the loan, someone with assets that could be used as collateral and who would be willing to cover the debt in case she defaulted. Her family and friends were not in such a position so this was not a viable option. Nathalie and her family would have to continue living in rented accommodation unless her husband found a way to employ himself in a job with a steady income that would allow them to apply for a new mortgage. In the absence of that the only other options would be to inherit, borrow from friends and family, or perhaps to keep on saving for a higher down payment. Meanwhile, Nathalie continued with her dreams and intellectual plans. She wanted to offer her family and herself the best living conditions possible and at the same time pursue her intellectual ambitions. For the former she needed credit, for the latter the stability that comes with good health as well as financial and emotional security. Being restricted in her access to life insurance cover for reasons that she could not control or change troubled her.

4

Introduction

Transcending insured life Nathalie was now faced with a conundrum. How to live a liberal life in a liberal world where credit is required for the accumulation of capital while being denied access to it on medical grounds? The intricateness of the problem lay in the apparent impossibility to live in the liberal world without living a liberal life. If Nathalie were to pursue a liberal existence she would have to find a way of making herself insurable or finding alternative collateral for credit. If she decided to challenge such liberal life she would have to rethink the very terms of her material and productive existence. Nathalie’s conundrum begins to make explicit the role of insurance in liberal life. Insurance exercises a form of governance based on very particular interpretations of life and what it is to be a (healthy) creditworthy living being. These interpretations are deeply connected with the sources of knowledge available to inform such understanding(s) of life and how data generated through that knowledge is interpreted. What insurance governs is the access and permanence in a regime that understands life as valuable resource that needs to be enhanced, promoted, and protected. Life is here taken to be a form of capital that needs to be invested in and developed with the view of generating growth, continuous growth. Under this form of reasoning life, life becomes a subject of economic growth, a site of intervention where vitality is taken to be an expression of what an individual is capable of achieving within a life course. An individual should therefore seek to make him/herself acceptable to such a regime and assume a docile attitude towards the forms of governance that come with it. The entrepreneurial spirit expected from docile liberal subjects is precisely one where they voluntarily and creatively find ways of creating value out of their own and others’ lives. It is this form of transcendence towards which liberal regimes are geared, one where individuals assume responsibility for their economic growth based on a logic of capital accumulation. The limit of this logic does not come with retirement at mature age but with death, understood here as the limit of the extension of vital functions. The true entrepreneurial self is expected to continue accumulating capital and creating growth until the last day. This in turn provides the basis for further accumulation and growth for future generations. The form of transcendence of liberalism is capital growth at infinitum. This form of liberal transcendence, as will be elaborated in Chapter 2, does not come naturally. It needs to be made to happen and requires a complex intervention in the structure of the lives of individuals. For individuals to be subjectified into liberal subjects, into successful ones, a strategic intervention needs to take place at the level of temporality. This is where insurance can claim its real modern legitimacy, its capacity to intervene in the time that structures the being of the subject. The time of the liberal is the time of the modern, the time of a continuous and protracted present as the site of being. This time, however, does not rely on its capacity to suspend the future or ignore the past but on perpetuating the present as the site of intervention of a

Introduction

5

future with regards to a past. As complicated as this appears, the logic is quite simple. Insurance operates as a technology of governance that creates present time in perpetuity. It does so through its technological character, more on which will be said in the following chapters. For the moment it should suffice to expand on the purpose of creating this form of perpetual present.

An insurantial logic Nathalie’s case illustrates in very general terms the role of life insurance in advanced liberal economies. Life insurance is a financial instrument that collateralises the applicant’s ‘life’ by turning it into a security that enables credit or secures an income in case of premature death or illness. It can also be combined with other securities to guarantee a loan. In doing so, it provides a security for dependants in case of the premature death of the policyholder. The logic under which life insurance operates, ever since late seventeenth century England (see Lobo-Guerrero 2011, Ch. 2), is one that derives its principles from what could in very general and abstract terms be defined as a capitalist way of life. Such a way of life is founded on the assumption that individuals are driven by self-interest which drives them into a quest for capital accumulation (cf. Hirschman 1977). Capital, in this form of life, is understood as value which can then be invested for the creation of more value (for a critique, see Gamble 2009). This possibility is supported by an economic, political, and moral environment that fosters the individual and collective acquisitive spirit. These principles support the operation of what has been analysed in the past two volumes of this trilogy as an insurantial logic. An insurantial logic aims at rendering uncertainty fungible (Lobo-Guerrero 2011, Ch. 1), that is, transforming uncertainty into something amenable to trade and exchange. In modern terms this is referred to as transforming uncertainty into risk. Its origins are, however, not modern. They become evident in the usury debates of the Medieval Renaissance in thirteenth century Italy. How uncertainty becomes risk is the application by merchants, later insurers, of a logic that can very grossly be understood through the following elements. First, a temporality thought of as a linear continuum of past, present and future, where the past contains elements from which to understand a present and a present is then time in which a future can be influenced and anticipated. The future is a play between the human capacity to prognosticate and also its incapacity to do so (uncertainty). What can be taken out of the realm of the uncertain, that is, that which can be calculated as event, is expressed through a language of risk. This way of thinking time breaks away from a Christian onto-theology where the future belonged to God and was a function of his omnipotence and omnipresence. In a Christian imaginary thinking uncertainty was heresy and the only event to be anticipated in life was death and, simplified to the maximum, the return of the Messiah (cf. Agamben 2005). In an insurantial logic, rendering uncertainty as risk became a way of colonising the future, bringing

6

Introduction

relative certainty to the world, and in so doing creating a stable order, in other words, and borrowing an expression from Luhmann, creating a security of expectation (Luhmann 2013, 78). A second element of an insurantial logic is the capacity to formulate events as a result of the praxis of prognosis. This has not been a simple practice and is not one that would be possible under the providence of God. Thinking in terms of events for an insurantial logic entails first the need to formulate them. There are no given events for insurers since birth and death, to take the two obvious possibilities, will never be considered in raw terms. They will always relate to a point in time and the circumstances of their occurrence will matter. The event for the insurer is determined by the security requirements of the client, the reason for which it approached the insurer. In the case of Nathalie the event is her capacity to repay a third of the loan during her working life. The lender will want the insurance company to provide a security to cover this sum in case she cannot pay. From this event, uncertainties such as infirmity or premature death become risk factors around which probabilities of occurrence can be calculated – or at least that is the promise of actuarial science. From an insurance perspective, the likelihood or not of the event materialising depends to a great extent on their capacity to accurately assess her capability to outlive the period and to be able to work throughout it. It is imperative then to conduct a careful analysis of her capacity. This particular relationality between assessment-event-object of protection will be revisited later in this chapter since it is there that the problem of the valuation of life lies. A third element relates to the legitimacy of knowledge. The interpretation of a present situation is a crucial stage in the insurantial process. Why would a particular interpretation be more valid than another? In the story of Nathalie, why would the decisions of the underwriter and the actuary be considered valid in ascertaining their client’s risk? Why would they require a statement by a medical specialist to identify, in what they would consider certain terms, the level of risk the client might represent to the company? Why would the insurer’s medical officer’s opinion be required? Two main elements intervene in providing an answer. The first is a confluence between the authority of the analysts and the legitimacy of the knowledge-base employed in the analysis. Both authority and legitimacy would be fundamental in ascertaining – in determining what was to be considered certain or not, true or false reality. In Nathalie’s case the underwriter and actuary were trained professionals specialising in the assessment of risks. The actuary would be specialised in the calculation of probabilities of an event taking place; the underwriter will be an expert in identifying and analysing the intervening factors of a present state of affairs and how these can change in the future. Their authority derives from relatively well-established bodies of knowledge transferred to them through professional qualifications, relevant experience, and/or university degrees. Their knowledge base is provided by actuarial science which is not simply related to the mathematics of probabilities but implies an understanding of the insurance business and industry. Nathalie’s doctor is

Introduction

7

recognised by her patient and the medical profession to be a medical professional and his judgment, if only clinical, would be recognised popularly as scientific knowledge. The insurer’s medical officer will interpret the data provided by Nathalie’s doctor and explain the implications of the medical condition to the actuary and underwriter. These two forms of knowledge, actuarial science and medical science, provide the base that informs the decision of the two insurantial professionals. Their decision will of course be affected by the business plan and the market imperatives in which their industry operates. What is a high risk for one company may not be so for a second one. Based on the relative certainty that derives from the assessment stage, relative because an observation could be incomplete, or in the case of Nathalie the diagnosis might be erroneous, insurers can then decide to assume the risk, in exchange for a premium, or not. From this logic it is possible to observe that the life of concern for insurers is never an abstract life. It is a life that can be defined in terms of livelihoods and lifestyles as the two elements that clients would seek to protect. These in turn relate to a capitalist way of life as broadly described earlier in which the capacity to accumulate provides a form of security. Nathalie could continue to live in rented accommodation but her enhanced financial situation allows her in principle to apply for credit to begin owning a property. This ownership is desirable as an asset that can be inherited by her son as the basis for further capital accumulation or be used as security in case of financial need of the family. If the value of the property increases or when she repays part of the debt, she will then be able to use the portion she owns as collateral for further credit, to invest more and accumulate more. Her capacity to incur the debt required to buy the property depends on her job and income but remains of course a matter of choice (see, e.g. Riles 2011). The paradox is that the need to create value out of capital creates a situation in which capital will always require higher degrees of protection consolidating a value-capital-security continuum.

Capable life vs potential life In Nathalie’s story the meaning of her life is not of concern to insurers. Their role, however, is to make ‘sense’ of Nathalie’s life in such a way that it becomes one of actuarial interest, one capable of rendering the uncertainty surrounding her future capacity to pay her mortgage fungible, that is, amenable to be traded and exchanged (see Lobo-Guerrero 2011, Ch. 1). The expression of this rendering is typically labelled in the language of insurance as risk, and risk here relates to the process of valuing Nathalie’s life. The way in which life insurers make sense of capable lives relates directly to the mechanisms through which they ascribe value to life. How they ascribe value to life is implicit in Nathalie’s story. Insurers assess the capacity of their clients to repay a mortgage based on the event of ill health or premature death. Premature in this case relates to the term of the policy and health relates to the client’s capacity to work and produce an acceptable income during that

8

Introduction

term. The value of the life in this case will depend on an assessment of the current health of the client and the family’s health history. Other sources of information could be used for these assessments, if controversial and politically sensitive, such as genetic information, as discussed in Lobo-Guerrero (2011, Ch. 3). Looking at the ways in which insurers ascribe value to life, by means of applying rules derived from the insurantial logic noted before, however, allows for making a wider observation. As argued, life insurance performs a central role in capitalist economies, it collateralises clients’ lives to make them eligible for credit, which in turn enables their capacity to invest and accumulate capital. In this capacity, life insurance can be seen as a technology that contributes towards the creation of value. Value is understood here, following Nancy, as relational. In his brief but enlightening piece ‘The Insufficiency of “Values” and the Necessity of “Sense”’, he argued that: Value consists in a relation. It is the price of something, reassured by another thing. There can, therefore, be no absolute value. That which is good for everything, or the general equivalent (currency), is worth nothing of and for itself. It is worth only what it represents in given conditions. That which is reputed to be of value in itself – freedom, equality, happiness, existence, art, God, or the diamond – only has value under the conditions of being defined by something else (or by its rarity, which amounts to the same thing). Price is thus always an interpretation. To speak of ‘values’ as absolutes thus makes no sense. (Nancy 1997, 127) As relational, the value that life insurance creates derives from the ‘sense’ it makes of life. This making sense of life is the result of a process which is typically modern and secular, one which moves away from an onto-theological imaginary which considers life to be created by a Creator, that is, a transcendent which is not created (see Chapter 2). For insurers, God and his omnipotence do not determine the value of life. Under modern secular conditions the value of life requires a sense, a sense that becomes a signifier of what a liberal life is. The sense is that of an acquisitive spirit driven by the liberal assumption that interests drive subjects. Interests, in turn, get reflected in practices and products of capital accumulation such as insurance which are then interpreted as expressions of valued life, secured life. This is but one of many possible senses of life, as will be illustrated particularly in Chapter 3. It is however one that, paraphrasing Nancy, structures a world, the world of insurers (cf. Nancy 1998, 8). Other senses, as developed in the following chapter, escape logics of valuation and reflect the in-valuable and in-calculable character of life. The relational character of value, for insurers, materialises in a practice, the practice of valuation. As practice, it seeks to create an effect and such an effect has consequences for how the ‘factfulness’ of life is to be taken. In other words, through valuation, insurers structure what is considered to be the life

Introduction

9

object of insurantial protection. Through processes of valuation of lives, such as the one described in relation to Nathalie’s case, insurers exercise a power that enables them to protect what they consider to be of value. Using Nancy’s expression, insurers value by exercising the power to evaluate (Nancy 1997, 128). While valuing life, life insurance provides a sense to the world, a sense that seeks to frame the ways in which individuals and collectives in the liberal world live their lives and express their being. Such frame is of course the subject of resistance and the fact that close to eighty per cent of the world population remains uninsured is an indication of its limited scope. Its role is to provide assurance in the face of uncertainty. In other words, and following the argument of Insuring Security, the sense created through insurance performs a security. There is, however, an insufficiency in this kind of ‘sense’. There is a nonsensical aspect in the insurer’s way of making sense of life, namely, that the valuation of life cannot be understood outside of the sense it creates. In The Creation of the World, or Globalization, Nancy (2007) argued that any sense of the world is formulated through the practices that make it possible. In his view, there is no sense in the world other than the senses that make it possible. Confusing and controversial as it sounds, this understanding of sense deprives the idea of sense of an ontological character. Consequently, sense does not precede understandings of life. Life is understood, instead, through particular senses which arise out of praxis. Whatever exceeds that sense, what does not fit within the insurantial assessment of Nathalie’s life, will not be relevant for the insurantial process. From an insurantial perspective, the sense through which Nathalie’s life is rendered valuable is that which considers her life in terms of capability (cf. Alt 2015). Capability is here understood as an expectation that current demonstrable abilities can be projected into the future and will materialise into expected action and behaviour. It operates a logic of anticipation where current conditions influence, if not determine, action and behaviour in a time to come. Capable life is, in other words, endowed life projected into the future in the form of events. Its contrast is that of potential life. Potentiality refers here to the indeterminacy of possibility of experience. Life understood from this position is capable of unthought-of achievements. The actions and behaviours of potential life defy a logic of anticipation and its correlate expectations. As a consequence, potential life cannot be thought-of in terms of events. The actions and behaviours that derive from it can only be accounted for after experience. It follows that potential life lies outside the realm of controllability built around anticipation, expectation, and event. The stakes of this distinction are important. Capable life is endowed life. Potential life is undetermined experience. Endowed life can be the result of a strategy, of a process of design, as the logical outcome of a logic of development. Undetermined experience is a manifestation of a breaking free from prescriptive logics. Whereas the rationality of life as capability entails a fixed ontology, an expectation of traceable origins (as in genetics, for example), the ontology of a rationality of life as potential is of continuous emergence.

10

Introduction

Potential life is not caused and therefore not amenable to be traced, it is not the subject of prognostication. It cannot be extrapolated from a past or derived from a trend; it is instead the manifestation of becoming. It cannot be disciplined or pre-empted. It happens. Given its logic, potential life does not fit within the praxis of life insurers. The rules derived from their insurantial logic do not allow for taking into account what cannot be rendered as capability within Nathalie’s being. The non-sense of the insurer’s sense of life is therefore that which escapes it, its excess. That excess, for example Nathalie’s hopes, desires, passions, and feelings, although not fitting within the insurantial logic of insurers, is not to be considered as waste. Instead of relating to the capability of Nathalie repaying a mortgage, it relates to Nathalie’s potential for being. The Nathalie whose body suffers from a chronic illness is still a creative and potential life. It cannot be understood as a remainder from the logic of calculation employed by insurers. It is vital potential. It is Nathalie’s passion which will ultimately make her productive during her professional life. Put in an instrumental way, it will be her imagination, feelings and desires that will drive her to be creative and resourceful in finding ways of doing things which might create new products, ideas, and services. Put politically, it will be those passions that will make her a subject of aspirations of whatever she comes to consider being a better life. Such unaccountable vitality, which escapes the logic of insurability, is paradoxically what enables current and future capability, the very aspect that attracts insurers’ interest in the valuation of life. Put somewhat differently, Nathalie’s vital potential exceeds the idea of value that underlies the technological agency of life insurance. The insurantial way of making sense of life is therefore only sufficient for its own technological operation. It suffices for the creation of an insurantial order upon which security instruments, such as life insurance, can operate. It is not sufficient, however, for making wider claims of order in the world. Taking this idea more slowly, it is possible to argue that life insurance operates as a signifier of sense, of liberal sense, where the signified is nothing else than the uncertainty that matters to insurers. Life insurance makes sense of uncertainty as a principle of liberal life, but only of the uncertainty that when made fungible constitutes the risks in which they trade. These risks, expressed in terms of their clients’ capability to outlive the terms of the mortgage in acceptable health, are the ones that confirm the sense life insurers give to ‘capable’ life. Where the sense that insurers ascribe to life matters, however, is in understanding the kind of life that is promoted and protected as a result of their insurantial praxis. This is to say that the insurer’s sense of capable vitality has an effect on the ways in which individuals understand their lived life in terms of livelihoods and lifestyles. In Nathalie’s case, the very fact of not being considered an insurable subject as a result of her disease denies her the possibility of accessing credit, of mortgaging a home, and as will be elaborated on below, of dwelling a liberal life.

Introduction

11

Dwelling a liberal life In this book life insurance is taken to be a signifier of how liberal life operates. It assumes liberal life to be an outcome of technological practices such as life insurance through which the principle of the acquisitive spirit of individuals can take place. Driven by the pursuance of their private interests, individuals are expected to accumulate capital in their quest for achieving financial security. This acquisitive spirit of the liberal subject is expected to operate a form of security against uncertainty. The premise of the book is therefore that life insurance performs a technological agency in making liberal life possible. As signifier of a liberal life, life insurance contributes towards the construction of a conception of the world, a liberal one where accumulation and acquisition are tightly related to the ways in which liberal subjects understand dwelling and homing. It should not be taken for granted that in contemporary forms of liberal capitalism it is not only desirable for liberal subjects to own their home, through a mortgage, but also that it is their mortgaged home which constitutes the value base for a gigantic financial futures and derivatives market on which financial forms of capitalism thrive, or sometimes not so much (see, e.g. Langley 2014; Assassi, Wigan, and Nesvetailova 2006; Wigan 2013). The hypothecated home, the ultimate liberal site for dwelling, is the celebrated aspiration of liberal subjects whose sense of life is governed technologically. Technological governance refers here to the efficient and effective application of protocols and rules dictated by a specific logic (cf. Amoore 2013). A logic operates the principles of formation determined by a rationality and these are taken as sacrosanct (see Chapter 2). An insurantial logic cannot challenge the principles of liberal governance; it is their instrument and it operationalizes those principles through technologies such as life insurance. The hypothecated home becomes the realisation of a sense of liberal life, a home that is the result of enabled credit, the result of valued capable lives, the result of a spirit of accumulation and acquisition. It is a ‘home’ that can be traded and used as collateral for further accumulation. The sense upon which this home is possible is such that it will never satisfy the voracious appetite of the liberal subject. It will need to be bigger, better located, better decorated. It is a liberal expectation that the way in which it is kept will add to its value, understood as the surplus between the debt incurred in its acquisition and its current price. The way in which dwelling takes place within this home is a form of being, a liberal being which of course changes over time as the rationalities, logics and technologies of liberalism evolve. Dwelling and homing, in a liberal ‘sense’, should be understood as part of a continuous quest for security, taking this explicitly to be financial certainty. When Nathalie approaches the mortgage provider, and as condition for her loan her husband is asked to provide collateral in the form of a life insurance policy over her life, the objective of both husband and wife is to provide the

12

Introduction

family with a security, a financial asset, that can be used to underscore their financial standing in the future. What they do not reflect on, perhaps because of their ignorance of the fact, is that their mortgage will become an element in a wider global financial portfolio that will provide the capital base for major global trading. The value of their desired home, value which is partly determined by their mortgage, will become the basis for a futures market where many other mortgages will be packaged together and sold to investors. Investors will then be able to sell these packages on the expected value of the cash flow to be generated by these assets. They will then be traded on numerous times creating surplus value for investors in the process. In other words, Nathalie’s family mortgage will become the raw material for the fabrication of financial value in the financial and capital markets. Nathalie’s private interest in protecting her family becomes the object of financial interest of a global financial sector avid to financialise anything that can generate a future cash flow, from mobile phone contracts to life insurance policies (Aalbers 2008; French, Leyshon, and Wainwright 2012; French and Kneale 2009). This phenomenon is part of what others have analysed as the financialisation of liberal life (French and Kneale 2009; Langley 2006, 2008, 2014). When these financialisation strategies fail to deliver their expected value, as in the financial crisis that started in 2007, the security that families such as Nathalie’s had wanted to create ceases to deliver their expected value. This helps us understand the precariousness of the security of liberal life. Liberal life is a sense of being, a sense that always moves towards but never reaches the hope of material security through secured accumulation. Like an asymptote that always aims to reach axis y, liberal life works towards security without ever being able to reach it. In this respect, liberal life is never an accomplishment but an aspiration. It portrays a sense of being which is the outcome of praxis. Through praxis it constantly changes the sense of the sense, which as noted by Nancy, ascribes the value of life to the very process of doing it (cf. Nancy 1998, 9). To dwell, taking a lead from Heidegger, ‘is the manner in which mortals are on the earth’ (Heidegger 2013, 146). Understanding ethos as dwelling, Nancy follows Heidegger in arguing that the sense of the world is not a given but something that results from praxis. Consequently, dwelling is not simply lived life, or as understood in liberal market terms, not the simple combination of livelihoods and lifestyles as correlates of consumption and production (Lorek, Vasishth, and de Zoysa 2012). To dwell is to make home, home understood as the space where being is possible. How that being is made possible, however, is a complicated matter. Building on the distinction noted before between capable and potential life, possibility here is not only understood as capacity, as an insurantial logic would have it. It encompasses the realm of the potential as that which cannot be anticipated, expected or prevented. Potential here is not quantity in reserve or latent qualities or abilities, as lay understandings of the term suggest (e.g. OED 2014). It is raw possibility on which an economic value cannot be calculated, yet on which the value of life itself relies. A form

Introduction

13

of dwelling premised on an understanding of being as calculable and prognosticable capability is a form of subjectification of the individual. It constitutes a form of what can be called, governed being. In contrast, a form of dwelling which encompasses the potential aspects of vitality operates a different ‘sense’ of life. It is not the liberal sense, although it contributes to making it possible. It is what, inspired by Nancy and Rancière, could be called a politics of aesthetics. The mechanisms, practices and technologies for governing being are vast, as the oeuvre of many such as Nietzsche, Foucault and Deleuze, to name a few, has vastly indicated. Life insurance is but one, albeit an unexplored technology that frames what the terms for a liberal dwelling can be and are to be. Through the sense of life instilled by insurers, in their quest to enable capability, credit is made possible opening up the possibility for capital accumulation. In the chapters that follow different cases are explored where the insufficiency of liberal sense highlights the incapacity of life insurance to value life. They indicate how the processes through which life insurance values capable life are only possible by its excess, the potential of lives. The sense that life insurance instils in liberal dwelling is a sense that cancels itself when the insurantial logic reaches the limits of a rationality of accumulation and acquisition. This opens up the possibility of thinking an alternative politics in the securitisation of life.

The thesis – the transcendence of liberalism The business of insurance is to manufacture security and profit from it. This is a key element in the transcendence of liberalism. To transcend is to go beyond a current condition, to exceed it, to surpass it. A transcendental creates a world. To transcend itself, life insurance is continuously generating its own conditions of possibility. The thesis of this book is that life insurance contributes to the transcendence of liberalism by producing three conditions. First, it produces subjectivities that stabilise human being into an indivisible and responsible self. Second, it produces time, the temporal framework on which uncertainty is to be managed as risk. And third, it produces markets of security as the instruments through which it governs the behaviour of individuals and collectives. Engaging with the subjectivity that results from liberal forms of governance requires first an engagement with the idea of individuality. To consider the individual character of being, to begin with, should not be taken for granted but interrogated as a knowledge formation. Humans will always defy understandings of individuality. To subject the self to an ‘identity’ which presupposes one and only one being in one life at a given time clashes with the wonderful world of imagination and desire that drives the passions of existence. What would a human be without dreams and imagination that go beyond existing material conditions and circumstances? What would a human be without the capacity to feel and think beyond the logics that hold hostage action and belief ? Veyne could not have put it in better terms when he argued

14

Introduction

that ‘[i]t is imagination that rules, not reality, reason, or the ongoing work of the negative’ (Veyne 1988, xii). The human that feels and dreams, that thinks and acts, does not always correlate to that of the logical self, that which dutifully operates within the rules of formation of a particular way of life. But it is the human hostage to logic that has been created as the subject of governance, as the governable self which is predictable in action and will. Acting outside the logical self constitutes a violation of the governable order, or at least of the order that is assumed governable and mechanisms have been developed to ensure that serious divergence from the norm have consequences. The individualised human, the kind that liberalism requires, demands careful management and control that includes fostering its capacity of being in very particular ways. The individualised human is therefore a curious formation. How is it that the human is created into a single unitary entity that experiences reality in the form of a self and is governed as such? This has much to do with the heritage of a Christian onto-theology where the self is the individualised experience of God and his Kingdom which can only be possible through the existence of a soul. The soul individualises the human by establishing a connection with God. The Christian God is singular and lonely; there is one Spirit, one soul, one Kingdom. Such an imaginary implies a system of governance and rule and Christians strive to come closer to God by making themselves His instrument. The individuality of the Christian, however, should not be taken for granted. It is actively reinforced, if not created, through sacraments, reiteration and public statement. The Creed, a profession of faith that can be traced back to the Council of Nicaea in the fourth century A.D. and that is recited in its various forms in public usually once a week by Christians of various traditions, is but one of the mechanisms through which Christians are reminded of the necessity of their individuality and their unity with the Church. The sacrament of confession is also, in its individual or collective forms that various Christian traditions have adopted, a mechanism to reinforce the belief in individuality before God. The Christian must cleanse the soul of its sins through confession as a way of preparing for Salvation. Within secular liberal traditions, debates on secularism considered (e.g. Blumenberg 1985; Löwith 1957; Schmitt and Strong 2006), a different principle operates. It is not a soul that individualises humans but the idea of interest. The individual is such for as long as it pursues its interests, that is, for as long as it sustains a focus of will and action on particular issues and when needed, reveals them. As in Christianity, there are various mechanisms through which this is made possible, most notably through practices of public truth. Although there is a vast discussion on what this term means, and on its philosophy and the politics to which it is subjected, the concept is understood here as fidelity to a standard or to an idea. The liberal individual is expected to be truthful in the sense of revealing the facts of his or her actions and wills when required. Failure to disclose them when necessary, or if disclosed falsely, accounts for not being able to hold oneself accountable to a single unity of truth and one will therefore be rendered as an unreliable subject. The

Introduction

15

importance of this observation is that reliability in action and will categorises responsible individuality within liberalism and categorises expectations of the subject. If someone is not found to be truthful, expectations of his or her future behaviour will be negative and this will affect how responsible individuals and entities will refer to them and treat them in the future. The relationship between interest, individuality and truth is therefore constitutive in liberalism of a moral, legal, economic and political order that relies on the singularity of the individual. The most important aspect of this relationship is the form of responsibility that derives from it, responsibility that lies at the core of the possibility of making the liberal individual a subject of government and control. The instantiation of this apparatus is not necessarily a result of force. Although such order can always be disrupted, compliance with it is rewarded with acceptance within social and political groupings, access to liberal services such as credit, to a good standing in front of the law, and with eligibility to public office. Without reliability in will and action there will be no trust in the future behaviour of the person involved, possible exclusion from associations, denial of loans, and mistrust when engaging in legal contracts if considered a party to them at all. A denial of credit entails in turn the impossibility to access further capital to enhance capital accumulation, the very aspiration within capitalist systems. Exclusion from the possibility of engaging in legal contracts withdraws the protection of the rule of law which in turn denies court services and trials in terms of disputes and enforcement of the terms of a contract. In sum, not having explicit interests or lying about them casts doubt on the reliable individuality of the person and denies it from being considered a liberal subject. The singularity of the individual is reinforced and recreated through liberal security technologies of governance such as insurance. A key element of these technologies is their politics of truth. To access insurance services, fidelity to truth and to accepted norms of behaviour in society is considered compulsory. Lying about facts or failing to disclose relevant information will render policies void under the understanding that what is insured corresponds to an explicitly stated insurable interest (see Lobo-Guerrero 2011, Ch. 2) and that contracts are agreed to in good faith. This is clear as principle, although as discussed in Chapter 5, there is a clear problem of moral hazard on the side of insurers which has attracted legal attention and rulings in the recent past. What is important, however, is to understand the role of this requirement of disclosing truth through insurance. In forcing such disclosure, the client is individualised and held to such individualisation through the duration of the policy, if it is to remain valid. This reveals the technological role of life insurance, to ensure the individualisation of the self. If, as shown in Nathalie’s story, life insurance becomes a condition of possibility for dwelling a liberal life, the disclosure of interests as truthful becomes a technological condition of possibility for liberal subjectivity. The individuality of the human and its subjectification as liberal, however, is not left without contestation. As explored in Chapter 3, by analysing a film

16

Introduction

that depicts a fictitious world in which insurance operates as governor supremo, the world of insurance continuously experiences a tension between the logical-truthful governable self and the human that dreams and thinks otherwise. The illusion that interests have taken control over human passions, understood here as undefined and sometimes unrestrained states of imagination and desire that influence will and action, is challenged by one where the thrill of free life and adventure take over the controlled environments of insured life. The insurantial logic premised on the individual’s wish to maximise interests that is expected to determine how individuals decide and act, is contested by demonstrating that the way of life which insurance promotes and protects is but one possibility of existence which could be challenged and transformed. The levels of certainty aspired to through insurance are presented as options within a plethora of possibilities limited only through the creative imagination of the human. The subjectivity that life insurance contributes to create and protect within liberal regimes is therefore one reliant on the obedience of interested humans to the logics of insurable life. This subjectivity is never a terminated product or an accomplishment but rather an aspiration, a project under continuous formation that requires two more elements to be possible: the framing of time through the creation of temporalities, and the creation, administration and policing of markets of security. To analyse the temporalities that life insurance creates, it is important to state that this technology is not a singular phenomenon but a collection of singular, co-existing, and inter-related events. The importance of approaching it in such a way is that, as Veyne and Foucault understood it, ‘once a variation is made thoroughly explicit, the eternal theme is wiped out and all that remain in its place are successive variations, all different from one another …’ (Veyne 2013, 7). The discourse of life insurance practices relies intensely on its capacity to frame behaviour by creating and combining multiple temporalities. To begin with, insurance never operates in the future. It is a present technology of governance. The present, however, is one that it seeks to modulate as a result of the ways in which uncertainty is approached by its modellers and actuaries. What it does in the present, and how it does it, is full of relevant detail. As described in Chapter 4, where the creation of two novel insurance products based on vital longevity is analysed, the very design of an insurance product implies a set of assumptions on what is considered to be the order of the real which has implications for how such an order is later perceived. By creating and marketing longevity bonds, for example, insurers project into the future their own beliefs of what life, as active capacity, is, and enshrine it into the products they sell. Such life is not of the kind engaged with in Chapter 3 in a world of passion and desire, but a logical expectable life rendered visible through statistics as well as health and security prognoses. What gets extrapolated into a future is not the potential of individuals but a projection of current capacity and knowledge of what vital function is. Regardless of how contested life, health, and social sciences are in their assumptions and

Introduction

17

discourses, insurers use particular approaches within them to create their products. The result, far from being a malign intended evil, is a product that projects their insurantial imaginary into the future. The future, however, will always be a present on which they will continue to intervene making their past assumptions the basis for current decisions. Secondly, a temporality is understood here as a mode of existence in time, a framing of will and action that conditions how life is promoted and protected, in other words, secured. Practices of framing, however, do not necessarily bring along a consciousness of responsibility, as will be detailed towards the end of Chapter 2. In this respect, insurers employ their logic in the creation of products without much awareness of the implications those products will have for the livelihoods and lifestyles of individuals in a time to come. Insurance practice is after all a highly technical matter supported by scientific knowledge, when possible and available, and aided through years of experience of operating a line of business. It is the role of thinkers and theorists, on the other hand, to identify these implications and raise awareness of how insurance practices modify the world in which they operate. What the vitality and mortality bonds sold in the capital markets in 2014, analysed in Chapter 4, will represent for the pensions of individuals across the planet by 2025, is yet to be known. What is clear is that they carry within them assumptions of what life is, they reveal the present in which they were designed, which might restrain the potential for the development of the human dimension of the individuals affected. The third and final element for the creation of liberal subjectivity through life insurance analysed in this book refers to the creation and management of markets of securities. Central to this idea of liberal governance relying on the creation of subjectivity and truth and the production of temporalities is Foucault’s analysis of what he called regimes of veridiction. For him, markets, the confessional, the psychiatric institution or the prison, all ‘involved taking up a history of truth under different angles’ (Foucault 2008, 33). Understanding veridiction as a truth according to a specific worldview instead of a universal or an objective reason, Foucault sought to demonstrate that truths are the effect of practices of power. In On the Government of the Living (Foucault 2014), his reflections on regimes of truth are a provocation from which to reflect on what is innocently presented by many as the empiricist world. To denaturalise it, to understand what structures it and on what kind of ideas and beliefs is such structure possible, becomes an exploration of how is a subject of power constituted. In the particular case of this book, how the liberal insurable subject is constituted leads the analysis to look at how it is that markets of security, actively produced by insurers are possible in the first place. Whereas classical liberal theory presents markets as sites that operate naturally, what histories of liberalism demonstrate is that such sites are creatively manufactured and governed to exhaustion. The histories of life insurance in different historical, political, social and cultural settings illustrate the

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Introduction

point. The life that life insurance is set to promote and protect is a changing object, one that responds to human experiences of requiring understandings of ideas of uncertainty. An insurance market is a market of securities. Once uncertainty in relation to a specified event and an explicit interest involving a subject is rendered as risk, and such risk is insured against through an insurance policy, there is an insurance product. An insurance product is aimed as an instrument to protect the policyholder against adverse consequences should the insured event materialise. At the same time, however, as a product it also becomes a commodity to be traded and exchanged. Insurance policies are packaged together in pools that are sold as packages to investors. Insurers sell out their written risks in order to open up capacity for the further underwriting of policies. Reinsurers underwrite some of the risks of insurers and as shown in Chapter 4, risks are also traded through bonds in the capital markets. The basis for such a market of securities resulted in the first place out of making something uncertain amenable to being traded and exchanged. Making it fungible, as explained in Lobo-Guerrero 2011, chapter one. The assumptions, expert perspectives, forms of knowledge and experience involved in transforming that uncertainty into a fungible commodity are never universal and objective. They are the result of a complex process of decisions that regardless of claims for actuarial science objectivity, remains a human art assisted by computers which provide the calculations. The market that results from creating insurance products and trading in them responds to the truth that insurers through their practices have created. The classical liberal idea that an invisible hand operates markets has no purchase under this perspective. The hand is not only invisible but is also multiple and complex. It is an agent. A fundamental part of the structure of these markets for security is the role of the state. An insurance policy is a legal contract between two parties that can be enforced at court should the need require it. The rule of law, a function and a service of the state, provides the legal base for the operation of these markets. There are also social and political elements to its role. Governments and legislative bodies can encourage the development of a particular line of insurance business as an instrument with which to manage specific uncertainties. Unemployment insurance, or health insurance, to name but two, are examples of this. As an actor within the structuring of these markets, states have a voice and an agency that influences how the market of securities operates. There is a more complex engagement by states in markets of security which only began to be noted and explored in Insuring War (Lobo-Guerrero 2012). What is important, however, in noting how markets become sites of veridiction, that is, sites where the truth of particular worldviews become legitimised through action, is that they become a source of valuation in liberal economies. Valuation is the process through which value is ascribed to a product. It is an active process, one where multiple actors and practices intervene.

Introduction

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Structure of the book and of the individual chapters The book proceeds in the following way. Chapter 2 sets the problem object of analysis, that of the technological transcendence of liberalism. After introducing what is understood by transcendence in relation to the wider debate in political theory on the legitimacy of modernity, it offers a discussion on how this problem is thought about in the book by building on the Heideggerian distinction between curiosity and wondering. It finishes by reflecting on the method employed in the writing of the book, that of historical epistemology. Chapter 3 engages with the problem of the excess of life in life insurance. It does so by resorting to the analysis of a film, Code 46, directed by Michael Winterbottom in 2003, to amplify and dramatise the processes through which life insurance values life as capital. By analysing the excess of life insurance as that which escapes its governance, the chapter offers a reflection on what it means to govern life as capability rather than potential for the ways in which liberalism is made to transcend. In doing so it builds on the distinction made between capable life and potential life offered earlier in this introductory chapter. Chapter 4 moves onto the analysis of the ways in which insurers constitute new markets for the securitisation of life. It draws on the invention of two new products, one for the securitisation of excess vitality and the second for the securitisation of excess mortality. Through an engagement with the details that make these products possible, analysis is focused on the temporalities that result from these insurantial practices. The production of term time, the time of insurance, is a continuous historical process that frames the conditions under which insured liberal life is to be lived. Chapter 5 deals with the problem of trust as a value at play within insurance products and practices. Analysing the historical principle of uberrima fides, or utmost good faith, in relation to recent scandals on the misselling of insurance products in the United Kingdom, trust is taken to be an effect of the relationality of power rather than its condition. Trust is here taken to be a signifier of truth that if interrogated reveals the ways in which insurance contracts frame the factual world on which capable lives are valued. Chapter 6 engages with what can be considered the biggest challenge to the ways in which insurers order the world through their actuarial practices ever since the introduction of the 1774 Gambling Act in Britain. In 2011, against the powerful pressure of the insurance industry, a European Court of Justice (ECJ) ruling forbade the use of sex as an underwriting category. In accordance with the European gender directive, insurers can thereof only discriminate on the basis of demonstrable evidence. Broad underwriting categories such as sex, historically used to classify risks, are no longer considered sufficient nor acceptable for that matter. The chapter discusses how the ECJ’s ruling constitutes a challenge to the order of classification on which insurers operate and exposes its practices and products to an enquiry from which to understand the politics of valuation at stake in this industry.

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Introduction

Chapter 7 moves on to think about what would life beyond insurance be like if rather than taken to be a matter of capability it was to be considered as potential for becoming. The chapter begins by offering a historical contrast with the case of the Nukak Makú, an indigenous group living in the jungles of contemporary Colombia, and the challenges observed in attempts to govern them under liberal conditions. The case is used to amplify the unnaturalness of the conditions of possibility for liberal life, usually presumed to be universal, and how they are defied even in contemporary times. By comparing life in the jungle with liberal life, the chapter moves on to explore the consideration of life as the potential of becoming by recovering the role of event as its constitutive moment. Considering the insurance of potential as impossible becomes a way of liberating life from the strictures of liberal governance and a step towards challenging the unnecessariness of the transcendence of liberalism. Chapter 8, as the concluding chapter, reflects on the epistemology of life insurance developed throughout the book. It analyses the world insurers make as part of the wider liberal configuration of power relations in which the politics of uncertainty is usually forgotten. It presents the uncertainties of liberalism as a problematisation of fear, the character of capable life as an aging course, the problematic dimensions of capable life depicted as capital, the constitution of moral economies and liberal political communities through the creation of capable lives, the role of capable life as a technological effect, and finally, the role of life insurance as an epistemology for the transcendence of liberalism. By means of demonstrating the precariousness of all of these dimensions, the book concludes that if it were not for the technological agency of instruments for governance such as life insurance, liberalism would not be able to transcend. Such observation opens up the possibility for redefining the eventalness of life. Governing through risk by employing technologies like life insurance is not an innocent practice but one complicit with the terms that define what form of uncertainty is to be tolerated and allowed. Redefining those terms implies a challenge to the very principles of formation, the rationalities, on which liberal governance operates.

2

The problem The technological transcendence of liberalism

Western liberalism with its associated forms of democracy has been presented since the end of the twentieth century as the victor of a centuries-long ideological struggle. Fukuyama famously, if controversially, argued in 1989 in The National Interest, then a three-year-old Realist magazine, that the triumph of Western liberal democracy signalled the ‘end point of mankind’s ideological evolution and the universalization of Western liberal democracy as the final form of human government’ (Fukuyama 1989, 1). The logical consequence of this observation, later developed in book length, was assumed to be that an expansion and consolidation of liberal ideas and practices across the globe, what has become known as globalisation, through interdependence or American-Western hegemony, was inevitable. The confluence of words in the title of the outlet where Fukuyama’s article was published helps understand the tradition from which such an affirmation arises. Marrying the terms ‘national’ and ‘interest’ appears innocent when based on a three-centuries-long intellectual tradition that characterises the state through the expression of interests that are assumed to be those of the nation or nations it represents. Curious as it might appear to the student of International Relations trained on the theoretical distinction between liberalism and realism, the publication of such a tenet of international liberalism in a realist magazine seems to bring these two schools of thought together. Indeed these two traditions are but an expression of an apparently single rationality of governance that needs to be made explicit and opened to scrutiny. The differences, however, matter, as will be evident later. The common denominator here is the almost too quick adoption and acceptance in international political and economic theory of the idea of interest as the operative principle for governance since the eighteenth century in the then Western world (cf. Burchill 2015). Statements, such as the following by George Washington on January 29, 1778 to the Committee of Congress, have been taken by theorists of International Relations such as Morgenthau, who cited it in his Politics Among Nations: The Struggle for Power and Peace (Morgenthau 1978), to ascertain the natural condition of interest as a principle for governance.

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Technological transcendence of liberalism A small knowledge of human nature will convince us, that, with far the greatest part of mankind, interest is the governing principle; and that almost every man is more or less, under its influence. Motives of public virtue may for a time, or in particular instances, actuate men to the observance of a conduct purely disinterested; but they are not of themselves sufficient to produce persevering conformity to the refined dictates and obligations of social duty. Few men are capable of making a continual sacrifice of all views of private interest, or advantage, to the common good. It is vain to exclaim against the depravity of human nature on this account; the fact is so, the experience of every age and nation has proved it and we must in a great measure, change the constitution of man, before we can make it otherwise. No institution, not built on the presumptive truth of these maxims can succeed. (Fitzpatrick 1939, 363)

Within the liberal intellectual tradition of International Relations, rational choice theory, initially developed by economists and widely applied by political scientists in the latter part of the twentieth century, has also been taken as a tenet of their scholarly analysis. In political science, rational choice has been presented as ‘the application of its supposedly “value-neutral” assumptions which posit man as a self-interested, purposeful maximising being’ (Petracca 1991, 289; see also Ostrom 1998). Idealist internationalists have extrapolated the individuality of man to that of the state and have considered the need for international organisation as the ideal medium through which states can maximise their national interests without cancelling those of others (e.g. Herz 1950). Assuming internationalism as a possible harmony of interests, scholars in this tradition assume the national interest as an unquestionable foundation for possible forms of global governance (e.g. Keohane 2002, 2005; Moravcsik 1997). By suggesting a supposedly middle ground, constructivists within International Relations, although critical about the naturalness of interests within international society, still recognise interests, if constructed, as the foundational idea for governance (Finnemore 1996; e.g. Adler 1997). Beyond a re-visitation of the so-called great debate on the concept of the national interest of the 1950s in America (e.g. Morgenthau 1951, 1952; Niebuhr 1950; Marshall 1952), the idea of interest as a principle for governance in an emerging and then consolidating liberal world remains problematic at best. In the previous two volumes of this trilogy, Hirschman’s essay on The Passions and the Interests has been used to show how this principle of governance was traced as emerging in the late seventeenth century as an alternative to a prior mode of governance based on the counterbalancing of passions (Hirschman 1977). The problematic easiness in the emergence and development of this principle of governance, however, lies in the simplification that comes with the adoption of apparently irrefutable observable principles that should not be challenged if a system of thought is to operate. When the ideas taken to portray the apparently smooth transition from a regime of

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passions to a regime of interests are carefully analysed in terms of the problems that gave rise to them, it becomes clear that the idea of an interested subject and of the national interest were as much the result of complex political processes as they were the result of political creativity (cf. Burchill 2015). Moreover, the distinction between passions and interests in contemporary political discourses and practices is not a clear one and assumptions that individuals and states seek through their behaviour to maximise their interests are actively discussed (e.g. Hutchinson 2015; Thompson and Hoggett 2012; Lakoff 1991). Williams’ analysis of the American neoconservative discourse and the influence of Irving Kristol, founder of The National Interest, mentioned before, is a case in point (M. Williams 2005). For neoconservatives, as observed by Williams, ‘the national interest is not just an analytic concept, nor can it be reduced to a material strategic imperative. Rather it is a symbol and barometer of the health of a political order, and particularly, a mark of decadence or vibrancy and virtue in a society’ (M. Williams 2005, 309–310). The problematic distinction between passions and interests as principles of governance, however, is not the focus of analysis here and will be critically explored in future work. What matters for the present volume is that the idea of interest as a principle for governance is understood within the context of its implications. Although nuances within the different European political contexts of the seventeenth and eighteenth centuries matter greatly in order to understand how this regime of governance materialised in slightly different forms of incipient liberalism, it is possible to make some general observations. Traditional ideas associated with liberalism such as liberty and equality should be understood once subjects of governance are assumed to be autonomous individuals and not elements of a body politic. The character of the Renascent ‘Man’ that resulted from the sixteenth and seventeenth centuries was not to be derived from a monarch or the Church but from the assumption that it had interests that were to be pursued either individually or collectively. Assuming ‘Man’ to be an interested being, granted it an individual character, a different kind of individuality from that which the Church had traditionally recognised in free men by virtue of their souls. This individual ‘Man’ was to become a new object of governance whose interests were to be promoted and protected, but also whose interests were to be regulated and controlled so as not to prevent the interests of others from being advanced. A whole new theory of government was to unfold out of this principle and the state was to become one of its main instruments. The characterisation of the state through its national interest is but an expression of this new theory of government that is liberal in inception and takes different forms according to how the association of interests it represents develops. The characterisation of ‘Man’ as a liberal individual assumed to be free and equal to others transformed it into a very particular kind of subject, a liberal subject whose responsible behaviour should correspond to the maximisation of its interests within a liberal moral and legal order. As time passed by, the liberal state was expected to become an instrument with

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which to maximise the potential of its subjects to pursue individual interest. Its role was seen as one of creating legal and political frameworks that ensured that freedom of action and the equality of individuals before the law was observed. Political regimes that favoured particular groups of individuals based on observed or perceived biological, religious, cultural or political features such as race, existential beliefs, class or ideology were considered illiberal in the twentieth century and were to be fought against. The triumph of forms of liberalism over forms of authoritarianism such as fascism and communism (cf. Arendt 1998) has been taken to be the triumph of a form of governance that maximises the interested character of individuals and mobilises forms of societies organised around systems for handling conflict, violent or not (e.g. A. Williams 2005; Dillon and Reid 2009; Jabri 2006). Taking liberalism to be a regime of governance centred on the promotion and protection of individual and collective interests, its history can be narrated through its crises, be they economic, political, social or cultural. Some of these have come in the form of revolutions in the established order, others as technical failures in the system of governance. The agricultural revolution of the eighteenth century (Kerridge 1967), the industrial revolutions of the eighteenth and nineteenth centuries (Hobsbawm 1988), the cultural and social revolutions of the twentieth centuries (e.g. Hobsbawm 1995; Zizek 2014), as well as the digital and molecular revolutions at the turn of the twenty-first centuries (e.g. Levy 1998; Schiller 2000; Zuss 2001; Franklin and Lock 2003; Kay 1995; Rose 2003; Rheinberger 1997) all have in common the displacement of alternative forms of organisation and order that rival the principles upon which forms of liberalisms operate. More present in the popular imagination of the general public are the economic and financial crises of the late 1920s, the 1980s, the 1990s, and the 2000s. The emergence and crisis of neoliberalism is a constant theme in contemporary scholarly literature and critique (e.g. Brown 2015; Harvey 2006). In spite of such resistance and opposition, which, incidentally, operate within the frames of tolerance of liberal regimes, liberal forms of governance continue to prevail, as adverted by Fukuyama, and seem to recover only too well from periods of difficulty and movements of dissent. Such endurance raises the question of the transcendence of liberalism. How is it that liberalism continues to transcend under continuous adversity and opposition? Rather than seeking an answer to this question on the problematic constitution of interest as the principle of formation of liberal governance mentioned above, this book resorts to a historical epistemological analysis of one of the technologies through which liberal governance is made possible, life insurance. Before proceeding, however, it is necessary to expand on a point of clarification mentioned in the previous chapter. To transcend, in the thesis of this book, is understood as an experience of going beyond a current condition, exceeding it, surpassing it. It differs from the idea of the transcendent as that which goes beyond any possible knowledge of a human being. It also differs

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from the Kantian understanding of a transcendental as a category that precedes thought, as an a priori, an ‘already there’ that operates as condition of possibility for knowledge. Whereas liberalism always transcends through its experience of governing its current conditions and overcoming its crises, the God of Christianity is transcendent in as much as it is the Creator that is not created, and totality is a Kantian transcendental category which assumes that there is such a thing as quantity. The position developed in this book arises from a different debate than the one developed in contemporary political theory for the analysis of the problem of transcendence and liberalism. There, the transcendence of liberalism has been discussed with regards to its structural resemblance to spiritual transcendentality. In relation to neoliberal governance, the argument that neoliberalism is structured on religious ideas of transcendence which are masked as secular has been advanced by theorists such as Connolly (2008) who, for example, analysed the workings of the evangelical-capitalist machine in the United States. Another illustration is Goodchild (2002; 2009), whose work on the role of money and credit in the interaction between capitalism and religion offers a reading of how capitalism’s faith in money relates to a form of liberal governance that structures itself around a masked form of spiritual transcendence that needs to be rethought. More recently, Ramey has argued that neoliberal governance is the expression of a political theology that operates as a ‘religion of contingency’ and a concurrent ‘politics of divination’. For him, money is the expression of the price of credit, a phenomenon that gives rise to a sacrificial theology where the present is indebted to an unredeemable past (Ramey 2014, lecture delivered on July 16; see forthcoming Ramey 2016). These positions contrast with those of Hardt and Negri (2001) who have argued that the role of the transcendental political apparatus of the sovereign state, which had taken over from a medieval form of religious transcendence, has been taken over by the immanent mechanism of control of capital. The discussion in this book relates instead to an older debate on the secular character of the idea of progress in modernity. One of its main exponents, Karl Löwith, believed that progress was a secular version of Christian eschatology built on the promise of salvation. Whereas the modern mind had ceased to be Christian in essence, its interpretation of history remained Christian in practice (Löwith 1957). Contra Löwith, Hans Blumenberg argued at length that progress in modernity expressed an internal logic different from that of Christianity, a process at work in history itself which was not the result of a transcendent. Such logic expresses human choice, selfassertion and human responsibility for its own fate, elements which legitimise an idea of modernity without resort to the secular (Blumenberg 1985). The question of the transcendence of liberalism, as explored here, takes sides with Blumenberg’s position and invites an inquiry on what makes liberalism work, and continue to work, over time. It asks, how is it that a regime of governance not based on the transcendence of a deity or of a set of (classical) ideals manages to keep humans individualised and pursuant of their

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interests side-lining alternative forms of political organisation and rule? A partial answer to this question, with clear links to debates on the idea of interest mentioned above, relates to the capacity of liberalism to produce liberal subjects, those who believe or are made to act as if they believed they are individuals with interests to be pursued. A second element refers to its tight relationship with capitalism as an economic system premised on the capacity to create and protect value. As noted in the previous chapter, value is understood in this book in relation to the sense employed in considering what life is. Drawing on the distinction made by Bergson in The Creative Mind between differences in kind and differences in degree (Bergson 1992), value is not taken here to be a universal category focused on differences in extent (degree). It is instead an individual feature, one focused on differences in sense (kind) that can be observed, if creatively, out of a necessity to define, govern, and secure. In this respect, the value of life will never operate as an abstraction but will result from the specific processes through which life is turned into an object of valuation. The value of life will only be sufficient to the sense out of which it has been constituted. It follows that if a life is conceived out of a different sense, its value will be different. Because of the specificities of the processes through which the value of life is constituted, it is imperative, then, to engage with the very terms on which those processes operate. Put differently, the logic of enquiry required for an understanding of the valuation of life demands work to understand the conditions of possibility and the conditions of operability for valuing life in particular terms. Once those terms are made explicit, what follows is to understand their effects, both in terms of governance outcome but also in terms of the transcendence they make possible. To understand the transcendence of liberalism, as argued here, it is therefore necessary to explore how it is that liberalism relies on the operation of a complex set of technologies that generate, manage and govern liberal subjects and at the same time excludes those who do not adopt liberal principles in their behaviour and forms of organisation. A close look into those technologies, one of which is insurance, allows for an understanding of liberalism as a gigantic apparatus of governance with very fixed principles but with changing rules and operations that provide its very conditions for existence and survival. As will be developed later in the chapter, such principles constitute a rationality of governance that dictates the logics on which the system operates. Before moving into the problem of thinking about the transcendence of liberalism, a third issue must be considered, that of its temporality. The continuous crises of liberal governance relate to its continuous exposure to uncertainty. Its precarious character reveals its reliance on the very practices through which it proceeds. The metaphor of the bicycle is useful to express such character. The motion of a bicycle is the effect, amongst others, of the equilibrium that results from pedalling action. Its motion is induced by the practice of pedalling and enabled through a traction system of which the pedals are a constitutive part. No pedalling, no traction, no equilibrium. The motion

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of the bicycle, in this example, constitutes its temporality, a temporality induced by a practice of pedalling and enabled through an apparatus. In the case of liberalism, its time is also that of its actions. Liberal governance does not operate in time; instead, it operates its own time. The time of the modern is not the time of a deity or that of an ideal. It is the time that results from its own production. It follows that the character of liberal governance is not simply one of expectations where what is expected is achieved, which would amount to a foreclosure of time. It is instead one where expectations are coupled with aspirations which in turn provide the ground from which to formulate further expectations. Rather than being an accomplishment, liberal governance always operates as an aspiration which relies intensely on its everydayness. Evening news headlines are full of data about the performance of stock markets of the day. Quarterly results of businesses and national economies are announced and scrutinised voraciously by press and experts. Economic growth indicators are presented as snapshots of how secure the system is. Dis-acceleration in an economy, particularly a large one, is presented as a cause for global worry and anxiety. The system relies, after all, on continuous growth that requires arduous work around the clock. Differential time zones in the world allow for a global economy to never sleep. Value within liberal governance is created in the here and the now; the present is all that matters. The question on the transcendence of liberalism as analysed in this book relates then, to the capacity of liberal regimes to create liberal subjectivities, to create and protect value, and to create a temporality of a continuous, if multiple, present as the basis for action. Thinking about such transcendence, however, is not an innocent practice and the thought process employed in the analysis of this book requires some discussion. In what follows, the mode of reasoning about the transcendence of liberalism will be presented followed by a discussion on matters of method employed in the book, namely, that of historical epistemology.

Thinking about the transcendence of liberalism There are at least two ways of thinking about the transcendence of liberalism. The first one is that of assuming it is an object and subject of curiosity. Assumed as a necessary regime of governance, experts, businesspeople and politicians are always very curious about how liberalism and capitalism work. They are constantly urged to understand the causes of its crises and ready and expected to formulate remedies when things go wrong. When they do, they are also prepared to appease investors around the world whose capital is required for the creation of economic value as the engine for further economic growth. Many graduate and postgraduate academic programmes are devoted to training individuals in these ways of being curious. There is a second dimension to this curiosity. Liberalism is a curious phenomenon in its own right. Its curiousness relates to the unusualness of the

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regime. Although it undergoes continuous crises, liberalism has not only failed to fail but seems to become an ever-growing and globalising regime of governance in the world, as Fukuyama’s dictum of the end of history seems to indicate. Its curiousness is that after failure it manages to reassert itself, making profit from the ashes and taking stock from the destruction in need of reconstruction. The curiousness of liberalism is that it reads failure as a business opportunity. There is still a third dimension. Liberalism is also characterised by an inexhaustible curiosity. Liberal regimes display a voracious desire to know everything that could potentially have an impact on the creation and protection of value, past, present and future. As a result of the digital revolution of the second part of the twentieth century and early twenty-first, any form of information is susceptible to be transformed into data from which information can be derived even if the event object of knowledge has yet to be constituted. The digitalisation of everything seems to offer liberal regimes and their economies the opportunity to capture any sensorial experience in the form of digital code which can then be reassembled to inform ‘reality’. Sensorial experiences are captured with sensors such as cameras, scanners, microphones, thermometers, amongst others, that can relay information in almost real time to databases around the world. Mediated experiences in the digital domain leave a digital trace that could be used as a source of information to create knowledge about something yet to come. Datamining has become a practice of resourcing information for the creation, development and expansion of markets as well as for securing liberal and illiberal regimes. The curiosity of liberals, the curiousness of the phenomenon, and the curious attitude of liberal regimes come together in the form of a complex apparatus that attracts significant resources to research the causes, deep and shallow, of economic and political success and failure. Such apparatus is the source of demand of forms of knowledge and methods expected to generate the means with which to understand how the system can be made to operate better, more strongly, quickly and safely. It privileges forms of knowledge that can provide solutions to urgent problems as they emerge. It is not too concerned, or not at all, with interrogating the deep underpinnings and philosophical foundations of the system of thought that supports liberal regimes. It simply wants to know of causes and solutions and how to repair the system when it fails. Failure is assumed as technical and therefore requires technical solutions. A different way of approaching the problem of the transcendence of liberalism is to wonder about its very existence. To wonder, Heidegger noted, is ‘the basic disposition compelling us into the necessity of primordial questioning’ (Heidegger 1994, 143). It is an attitude that focuses on the unusual, not to explain its cause, or as he put it, ‘not [as] a dissection in the sense of an explanatory dissolution into a manifold of components’ (Heidegger 1994, 148). To wonder is to advert to the presence and uniqueness of the unusual and transform it into an empirical site from which to interrogate its conditions of possibility and operability. This making of the unusual a focus of

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scholarly interest and interrogation prepares the ground from which to pose questions as to how something is made to become, but most importantly, to demonstrate its unnecessariness and contingent character. Wondering is a research attitude that opens up the possibility for thinking order and its possibility of being otherwise (Lobo-Guerrero 2013). It lends itself for understanding the sources of legitimacy and authority on which regimes of governance such as liberalism rely. In doing so it grants itself the capacity to challenge such legitimacy and authority on the very grounds, on the very terms, in which it operates. It allows itself to move away from the already defined concept, that without history, and concentrate on the problems and ideas from which conceptualisations and definitions result. It opens up the possibility to re-historicise the intellectual cornerstones of the moral principles and beliefs that support regimes of governance. Wondering is a way to undertake the intellectual struggle we are alerted to by Foucault of ‘[d]igg[ing] into the archives of humanity in order to discover the complicated but humble origins of our lofty convictions’ (Foucault, as read by Veyne 2013, 54). Wondering about the unusualness of liberalism opens up the possibility for understanding the system of thought on which it operates. This does not amount to saying that liberalism thinks the world. It is rather an invitation to think about how a world is thought of as liberal. A system of thought is understood in this work as the interrelated operation of the rationalities, logics and technologies that, brought together, produce a governance effect. Rationalities are here taken to be the principles of formation, the deep beliefs and unchallenged facts that operate as ontological moments for thinking about phenomena. They perform a role of authorisation of thought by establishing the conditions without which such a way of thinking would not be possible. On a second, and subservient level, logics are understood as the set of rules of formation that, governed by their rationalities, frame the politics; that is, the power relations that are to produce order in the world. Logics derive their legitimacy from the accuracy with which they apply the rational principles on which they operate. Logical reasoning is not thinking. Its role is to perform a delegated function from the rationality it serves. Its responsibility is therefore one of accurateness in the application of principles to the production of rules of formation. Technologies, in turn, and acting on a third subservient level, refer to the systematic and repetitive application of those rules. They are aimed at producing intended effects so as to create, promote and protect an order. Whereas those effects might vary in their extent and degree, they aim to be of a similar kind. Here, the Bergsonian distinction between differences in kind and differences in degree comes into play again for reflecting about the impossibility of a logic to contemplate alterity in kind if it is to remain faithful to the rationality that supports it. Consequently, a technology reflects such impossibility and seeks to normalise its objects of governance. In the case of a governmental technology, such as insurance, it seeks to produce individuals whose subjectivity is prone to be shaped with the changes of time.

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While logics operate rationalities, technologies employ logics to produce results. Their role is to exercise precision, to remain as faithful as possible to their logic so as to ensure the continuous replicability of effects. It follows that the technologist’s role is not to challenge logics, although its experience can feed into the logician’s reflections on how to re-write rules of formation. Responsibility at the technological level is therefore circumscribed to the strict application of rules; divergence from them signifies independence of action which would constitute a violation of the order the technologist is expected to promote and protect. The order created by a system of thought, its effect, can be expressed in the form of an ethics, understood here in the intellectual tradition that takes it to be a way of being in the world. This idea, which has a strong Nietzschean and Heideggerian heritage, presupposes that there is no essence without being and that it is being and its expressions that should be constituted as the object of reflection. There is no single way of being in the world and each one will be a plethora of complex ensembles of imaginaries, ideas and beliefs. What a system of thought reveals, however, is how being in the world can be framed and acted upon inducing specific forms of behaviour and attitudes that will be expected to materialise in very particular forms of action. Reflecting upon a system of thought opens up the possibility of de-naturalising a way of being in the world. Liberalism as a regime of governance creates its subjects and seeks to govern its behaviour through a form of authority that sometimes appears to be silent, and apparently invisible. As noted by Daston and Vidal (2004, 21), ‘[t]he best kind of authority works invisibly. If it must brandish weapons and admonish its subjects, it only advertises its weakness; the stablest order is unfelt and unquestioned’. The brandishing of weapons and admonishment of subjects of liberalism is however only too visible when the system of thought that makes it possible is wondered about. The ethics of liberalism is not silent, although it has become naturalised in the very actions and discourses that make it possible. The enframing to which liberal subjects are subjected appears facile, uncontested, smooth, when the technologies through which this regime of governance operates succeed in creating a stable and unchallenged order. When they fail, what is usually presented as a crisis, curiosity about how and where its technologies and logics miscarried usually follows as a way to pre-empt a next crisis by either making the technologies operate more precisely or working on its logics to be truer to their rationalities. A wondering on liberalism and its capacity to endure the changes of circumstances and time, however, does not need to focus on crises or wait for them to happen. The wondering required for thinking about the very possibility of liberal regimes sharpens the senses to constitute empirical spaces from which to interrogate the weapons and disciplining of liberal regimes.

On historical epistemology Historical epistemology is a term borrowed from historians of science who have developed it as a way of conducting research taking epistemology to be a

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historical matter. According to Nasim and others, its origin can be traced to the work of Ludwig Fleck in the Austrian context, but mainly to the French epistemological tradition of the 1920s and 1930s and the work of Gaston Bachelard as chair and director of the Institut d’Histoire des Sciences et Technique at the Sorbonne in Paris (Nasim 2013; MPIHS 2012, 7–12). Dominique Lecourt claimed in 1969 that it was Bachelard’s successor to that chair, Georges Canguilhem, who first used the term (Lecourt 1969). He noted then that epistemology, as ‘the discipline which takes scientific knowledge as its object’, is essentially historical and should therefore be demarcated from philosophy (MPIHS 2012, 8). ‘In opening the field of historical epistemology, he [Bachelard] uncovers […] what philosophy is eager to cover up: the real – historical – conditions of the production of scientific knowledge’ (Lecourt 1969, as translated and quoted by MPIHS 2012, 8). Although others credit the coining of the term to authors such as Abel Rey as early as 1907 (Braunstein 2012), what has mattered for the French tradition of historians of science is that epistemology offers a site from which to interrogate the ways in which knowledge formations have been constituted. As noted by Rheinberger, this tradition has focused on the reflection of the historical conditions and the means for transforming things into objects of knowledge (Rheinberger 2010, see also Schmidgen 2012). Most notable with this tradition of thought has been the work of Michel Foucault, who, as a student of Canguilhem and Althusser, continued to develop it as a way of understanding regimes for the governance of life through institutions such as the clinic and the prison, but also through the formation of subjectivities and their governance. Historical epistemology, as very simply but aptly put by Lorraine Daston, is the ‘history of emergence’ (Daston 2007, 807). It is a form of writing history concerned with understanding how a problem, discourse or practice, was made possible at a specific moment and place. It combines the Kantian concern of understanding the conditions of possibility of an idea, concept or tradition, with a genealogical enquiry on the conditions of its emergence. It differs from it, however, in that it is not concerned with finding a pure origin of a knowledge formation and does not consider such origin as preceding the experience of knowing. It is instead, an opening up to the possibility of observing facts, not as natural or preformed givens that can be traced in time, but as the amalgamation of various elements that might present themselves in various historical layers. Daston used the analogy of an archaeological site to illustrate how the historical understanding of facts demands attention to the complex interaction of elements that might have been deposited in different moments (Daston 1994, 289). These facts usually do not come in refined manners and logics ready to be described. As expressions of lived experience, they demand from the observer careful attention to the detail which contains the sometimes minuscule traces of an imaginary, a way of reasoning, or a belief. Within the humanities and the social sciences, historical epistemology, although not always recognised as a label, has been used for some decades,

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building on, and inspired by, the work of Foucault. Here, the Nietzschean idea that ‘it is only that which has no history, which can be defined’ (Nietzsche 2003, 53) has been taken as the basis from which to assume events in history as unstable formations. As formations with a history, they can be constituted as sites for interrogation. Taking distance from the history of ideas and from the Annales School of historical research, Foucault developed this position further by arguing that events result from diverse ways of problematising reality, not by doing a history of ideas but rather one of problematisations. He explained it in one of the last interviews before his death in 1984 in the following terms: For a long time, I have been trying to see if it would be possible to describe the history of thought as distinct both from the history of ideas (by which I mean the analysis of systems of representation) and from the history of mentalities (by which I mean the analysis of attitudes and types of action [schemas de comportment]). It seemed to me there was one element that was capable of describing the history of thought – this was what one could call the element of problems or, more exactly, problematisations. (Foucault 1994, 117) Events, for Foucault represent the expressions of truths, which in turn express relationships of power. Assuming such relationship between events and truth(s) is central to Foucault’s understanding of the nexus between power and knowledge, a typical case of Foucault’s take on epistemology as a historical matter. The following quotation, taken from an interview with Foucault entitled ‘What is Critique’, is illustrative of his understanding of this idea. What we are trying to find out is what are the links, what are the connections that can be identified between mechanisms of coercion and elements of knowledge, what is the interplay of relay and support developed between them, such that a given element of knowledge takes on the effects of power in a given system where it is allocated to a true, probable, uncertain or false element, such that a procedure of coercion acquires the very formation and justifications of a rational, calculated, technically efficient element, etc. (Foucault 2007c, 59) Events provide an entry point from which to observe how problematisations involve ideas, beliefs and assumptions that constitute the imaginary out of which problems are posed as such in the first place. A problematisation expresses a relation of being in the world, an experience that, in turn, never takes place in isolation. As experience, a problematisation can be explored to reveal the particular beliefs, the principles of formation, on which a form of life operates.

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Observing events as the result of problematisations has been the historical epistemological approach adopted by many of Foucault’s followers when seeking to understand the making of forms of governance in particular settings. It has provided an opportunity from which to interrogate how power relations materialise in, what could be called, experiences of truth. These do not represent universal doctrines from which to understand reality, but are rather the representation of an experience of belief which supports a way of thinking about things and events. Experiences of truth are contained in discourses, practices and material objects, such as monuments, that can be analysed in terms of the power relations that give rise to them. The work of Foucault on archaeology and genealogy provides illustrations of how this can be done without turning these labels into restrictive methods or ‘tools’. It is not a matter, however, of differentiating the work of the young Foucault in the 1950s and the late Foucault of the 1970s and early 1980s into stages, which might or might not show coherence or rigour in thought (e.g. Han 2002). It is rather to recognise, as he himself noted in later work, a focus on experience as evidence of a governed life. ‘[E]xperience is understood as the correlation in a culture between fields of knowledge, types of normativity, and forms of subjectivity’ (Foucault 1990, 4–5). His way of wondering consisted in identifying what he called ‘focal points of experience’ ‘in which forms of a possible knowledge, normative frameworks of behaviour for individuals, and potential modes of existence for possible subjects are linked together’ (Foucault 2011, 3). This contrasts with the adoption of his later work in the social sciences under the label of governmentality as constituting a tool to be employed in critical analyses of political technologies and governmental rationalities (Rose, O’Malley, and Valverde 2006; O’Malley 2009; Elden 2007a, 2007b; Dean 1999; Gordon 1991a, 1991b; Rose 1999; Dillon 1995; for a critique see: Lemke 2007). Governmentality ‘theory’, already the subject of textbooks widely read by students across the social sciences mainly in the Anglo-Saxon academic sphere, tends to isolate the Foucaultian project from his historical engagement as wondering on experiences of governance. Within a Foucaultian inspired study of International Relations, particularly within Critical Security Studies, this approach has by now become almost part of the canon through which students are disciplined into the identification of the conditions of possibility and operability of specific technologies of security without paying much attention to the rationalities from which they derive. Archaeology and genealogy are presented almost as methodological approaches to the social sciences. The Heideggerian roots of Foucaultian thought must not however be forgotten so easily. The possibility of approaching experience as an object of analysis of power relations gets diluted when it starts to believe in its own philosophy. To focus on the technologies and logics through which liberalism operates will only allow for a curiosity that asks why the system is working or not and how it can be made to work more precisely. After all, as observed by Heidegger, ‘curiosity has no interest in wondering’ (Heidegger 2003, 171;

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Heidegger 1994, 143–147). Posing questions to the rationality that supports the system of thought on which liberalism operates, on the other hand, could challenge its core assumptions and keep its philosophy in check. Heidegger’s invitation to wonder, as the disposition that compels the necessity of primordial questioning, moves beyond the technical and logical curiosity and ventures into the very possibility of being of liberalism. Subjecting its principles of formation to scrutiny in relation to their very condition of possibility provides an opening for thought that could expose them to their unnecessariness. This is an urgent task if thinking governance and order beyond liberalism is ever to be possible.

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Insuring the life excess

Every system is overcoded and proliferates in only relatively stable and relatively productive ways. There are all kinds of gaps and hesitations, excesses and remainders, which arise from the fact that all kinds of things other than capitalism are constantly going on which constitute lines of interference which can never totally be tuned out. Opacity, division and wildness result. (Thrift 2005, 2) If we had enough information we could predict the consequences of our actions. If we know what would happen in the end, would we be able to take the first step, to make the first move? (Winterbottom 2003, preface)

Relative stability and relative productivity, as adverted to by Thrift, denote the existence of unstable and unproductive, yet valuable, features of life. The possibility of living, that is, of taking steps, as noted by Winterbottom, lies in the capacity of giving credence to the uncertain character of vitality. Providing a central stage to the invaluable and the uncertain dimensions of life is one of the core features of Code 46, a film directed by Michael Winterbottom in 2003 and written by Frank Cottrell Boyce. Invaluability and uncertainty are in turn two main aspects that define the possibility of existence and operation of life insurance. They operate as the excess of productivity and of the calculable certainty of life, two of the primal features of biopolitics. Taking this film as a critical artistic practice, this chapter explores the excess of biopolitics present in, and constitutive of, life insurance. It proceeds in three parts. It begins by offering an analytical narrative of the argument of the film focused on what is here termed, a ‘rape’ of biopolitics (for a more descriptive approach to the film, see Goss 2007). A second section analyses the politics of fear that derive from life insurance products and practices. The chapter continues with an analysis of three dimensions of valuation immanent to the ways in which life insurance transforms livelihoods and lifestyles into investment capital: valuation as a practice of inclusion, valuation as vital ontology, and valuation as the basis for moral economies. The chapter concludes with a reflection on the relationship

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between the ‘vital excess’ and the resistance to life’s valuation immanent in life insurance practices.

Code 46 and the rape of biopolitics In the imaginary futuristic world of Code 46, liberal governance in the developed world was overtaken by insurance. There, insurance provided the technology for authorising or denying all forms of human interaction and circulation, from sexual intercourse and birth, to exit and entrance into areas of the civilised world. The inside world was one in which risks were kept under strict control and infringements of the established order were punished with exile. Insurance ‘cover’ was a prerequisite for human circulation and modulated individuals’ behaviour by linking biometric identifiers such as fingerprints with credit ratings in the form of a card that replaced passports and visas. The kind of ‘cover’ protecting an individual would be displayed by a card which turned red as cover expired. It could be extended to allow its holder to circulate outside of the protected liberal area, referred to in the film as afuera, but cover outside would be limited in time and granted only if the risks involved were deemed ‘manageable’. Afuera – the Spanish word for outside – was the world where people did not, or could not, measure and manage uncertainty in terms of risks. Risks in the imaginary of Code 46 were tightly linked to a set of human scientific disasters, for example, a high exposure to the risk of incest as the result of decades of in-vitro fertilization based on a batch of only twenty-four cloned foetuses. To manage the risk of unbeknown incest amongst couples, the authorities of that imaginary world had issued Code 46, a law that established strict rules on human reproduction and which in its first chapter read: any human being who shares the same nuclear gene set as another human being is deemed to be genetically identical; the relations of one are the relations of all […] Due to IVF, DI [donor insemination] embryo splitting and cloning techniques it is necessary to prevent any accidental or deliberately incestuous reproduction. (Winterbottom 2003) Code 46 was an overwhelming instrument of birth authorisation and moral order. It asked all prospective parents to undergo genetic screening before even trying to conceive, and results of 100, 50 or 25 per cent match led to a prohibition to reproduce. Unplanned pregnancies incurring a violation of the Code would be terminated. If prospective parents were ignorant of their mutual genetic relationship at the moment of conception medical intervention was authorised to prevent further breaches to the Code. Conscientious breaches were treated as criminal offences and led, potentially, to the exile of parents into the world of afuera. Experimentation with artificial fertilisation, embryo splitting and cloning in the imaginary of Code 46, played the role of original sin for Christianity.

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Disastrous consequences in the artificial creation of life provided the foundation for a moral narrative that authorised the governance of reproduction and of human interaction, two related dimensions of life deemed as dangerous. The risk of incest became a principle of operability for a moral order that fostered genetic diversity as a condition for insurability. Genetic similarity was seen as a threat to the security of a wide pool of genetically diverse individuals – the ‘covered’ citizens. The danger consisted not only of a threat to the health tissue of society – a consequence of which was the condemnation of genetic criminals and illegally conceived babies to living afuera. It also challenged the governmental possibility of harvesting a healthy gene pool in the liberal world, the very possibility of a form of governance that relied, almost entirely, on the agency of insurers. Whilst endangering the technology that enabled genetic and moral order in society, breaches to the Code were treated as a security matter which deserved, as illustrated towards the end of the film, the immediate attention of the authorities. Jurisdiction in relation to the Code included both the worlds of inside and of afuera. The moral economy instantiated by insurance in the world of Code 46, however, transcended the authorisation of births and the freedom of movement. It operated at the level of the deep dreams and wishes of individuals in an urge to protect them from events that would compromise the security of their genetic disposition. In this respect, the authority of Code 46 was directed at colonising the imaginaries of individuals. Damian Alekan, a black man living in Shanghai – a city included in the inside (liberal) world but surrounded by the world of afuera – and whose passion in life was bats, had struggled over a period of eight years to get cover to fulfil his lifelong dream – to visit a particular colony of bats in Delhi. The Sphinx, a Shanghai-based insurance corporation specialising in the issue of short-term cover certificates for specific activities such as dangerous travel, had systematically denied Damian the papel (insurance certificates) required to travel afuera. Maria (played by Samantha Morton), a printer of papels at the Sphinx and who had lived afuera for ten years as a result of her father’s loss of cover due to financial irregularities, produced for him a faked papel which he used to go to Delhi only to die of an ineluctable disposition to Wards disease. The Sphinx, whose motto was ‘Always Knows Best’, was aware of his disposition to the disease, a disease to which most people in Delhi were immune, ‘which is why he could not get cover’ (Winterbottom 2003, 37:38–38:03). William (played by Tim Robbins) was a fraud investigator based in Seattle working for a security consultancy hired by the Sphinx to look at an event of fraud at the company. A faked papel had been issued by one of the printers and as a consequence its bearer died performing a dangerous activity in the world of afuera. William had been tasked with identifying the guilty printer. To do his job, which consisted in intuiting people’s thoughts to find out ‘factual truths’, he was provided by his employer with an ‘empathy virus’. Under the influence of the virus, all William had to do was ask his interlocutors to tell him something about their personal lives and he would

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then be able to intuit their thoughts and know if they were guilty of having printed the fake papel. At the Sphinx he interviewed all staff of the printing department and had identified Maria as the culprit. The problem was, however, that he felt more than empathy for her and decided instead to identify one her colleagues as the guilty printer. Seduced by his liking for Maria, William reported the results of his investigation to the Sphinx’s manager. ‘Are you sure it’s him?’ asked the manager. ‘I thought it might be her’ pointing at Maria’s picture. ‘I don’t think so’, replied William. ‘Do you have evidence?’ insisted the manager. ‘I don’t need to give you evidence, it’s intuition you’re paying me for’ replied William. (Winterbottom 2003, 12:50–13:06) In the world of Code 46, viruses were not only vectors of disease but had also been genetically manipulated into instruments that could influence body reactions or enhance individuals’ senses. Although the Sphinx claimed to know it all, it hired a consultant with enhanced intuition to identify the culprit of manufacturing fake papels. The empathy virus enhanced ‘intuitive guessing’. This virus-enhanced intuitive knowledge rivalled the ‘objective evidence-base’ used by the Sphinx to claim ‘it knew best’. Intuition, as a ‘direct perception of truth, fact […], independent of any reasoning process’ (Dictionary.com 2011), revealed, however, a form of faith which was necessary for its success. This became evident in a dialogue between Maria and William when he coincidentally met her on the train on the way back to the hotel. During the interview at the Sphinx Maria had told William it was her birthday and during their encounter at the train Maria asked him to take her to dinner. She also suggested going to a club afterwards; her intention was not to sleep throughout the day since she was afraid of a dream she had been having every birthday. At the club William revealed to Maria the secret of his job. ‘I’m on a virus right now, an empathy virus. I take an empathy virus to help with my work’ said William. ‘I don’t like that, that’s weird. You could pick up stuff about me’, replied Maria. ‘I could’ said William. ‘That’s like wearing x-ray specs, to look at girls’ underwear’ replied Maria. ‘I got xray specs, they don’t work’, added William. ‘But you bought them. You wanted them to work’ argued Maria. ‘I was six years old. I was interested in skeletons, not underwear’ replied William. (Winterbottom 2003, 18:09–18:35) After revealing his secret, they both met Damian, who had come to the club. Conscious of his complicity in what was about to happen – witnessing Maria giving the fake papel to Damian – William wanted to know of Damian’s reason for needing fake cover. En-route between the airport and Shanghai, at an entry point, William had established conversation with a

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street vendor who had asked him, jokingly, if he would agree to change places with him so the vendor could come into Shanghai. Having heard the conversation, William’s driver told him, ‘if people don’t have cover, there’s a reason’. That’s exactly what William mentioned to Damian (Winterbottom 2003, 19:54–19:56). ‘Yes’, Damian replied, ‘the Sphinx knows best. Best. The Sphinx knows a lot. It doesn’t know what I know. Anyone who has ever wanted something knows you have to be prepared to risk. I think I’ll be okay. Some things in life can be worth the risk to get it.’ (Winterbottom 2003, 19:58–20:11) The risk Damian spoke of, however, differed from the understanding of this concept by the Sphinx. As far as they were concerned what he wanted to do, the event for which he needed cover, was nothing but certain uncertainty, that is, an activity which would in all likelihood lead to his death and therefore to a claim and a loss of profit for the Sphinx. For this reason they had consistently refused Damian’s papel under a simple principle of risk management through which they aimed at protecting the lives of those insured and the interests of the company’s shareholders. He was, however, never informed of this reason. The Sphinx knows best, he was told, and ‘if people are refused cover, it’s for a reason’. Damian’s knowledge of what was best for him was premised on a different base than that of the Sphinx. For him, life was more than managed and controlled risk. It involved the thrill of doing what he had always wanted to even if the seeming price to pay was high. It was the thrill of playing outside the system, of embracing the possibility of being responsible for his own actions and being free to bear the uncertainty involved in what was presented as ‘risky’. It was a liberation attitude, a way of being beyond itself, of breaking away from the self that the world of Code 46 had instilled in him and a self of which he wanted to take control, even if it meant a one-way ticket to afuera and then to death. This knowledge was not comprehensible to the rationality of protection underlying the business model and corporate responsibility of the Sphinx where life could only be ‘if insured’. Paradoxically, once again, it was the existence of an afuera that operated as the contrast against which the Sphinx could provide order and security. Knowing that a life afuera entailed no-protection, exposure to the dangers of natural light (people in the world of inside lived at night and slept during the day to protect themselves against dangerous sunlight) and no support in case things went wrong, allowed the Sphinx and other insurance providers to design cover for a lifestyle free of those dangers. In other words, the Sphinx and the wider insurance complex created an inside as a space of security. After all, a world of risk, as managed and controlled uncertainty, was only possible in the film – as in real life – in contrast to an imagined state of certainty, of death, for example.

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When William’s boss in Seattle asked him to return to Shanghai to investigate the death of Damian, which had been identified as related to a fake papel produced by the same printer he had been sent to investigate in the past, William discovered that Maria was no longer working for the Sphinx. He found out she had been removed to a clinic afuera where she was allegedly being treated for a lost finger and provided with prosthesis. He realised, however, that she had been intervened in relation to a violation of Code 46 and the replaced finger acted as placebo, an ‘intervention’ enabled through and covered by her ‘insurance cover’. They had removed the foetus as well as her memories of the man with whom she had slept and unknowingly violated the Code. Claiming to be dealing with a fraud investigation, although at this stage he was dealing with his private business, William demanded that the clinic release Maria and drove her to her flat in Shanghai. While she slept, William had his and her DNA tested only to find out that Maria’s and his mother were genetically identical, hence the unwanted violation of Code 46 that led to Maria’s ‘intervention’. He explained this to Maria when she woke up but she could not remember anything apart from a strange dream of which she could not make sense. Meanwhile, William had spent most of his period of cover in Shanghai and by the time he decided to return home, his credit card had turned red indicating that his cover had expired and he was not allowed to ‘circulate’ back home. Ironically he was still covered in Seattle but not for the journey to get there. He then returned to Maria seeking help with a fake papel to get him home which she managed to provide on an exit-only basis. When Maria delivered the papel to William at the airport she told him she now remembered having seen him in her dream. William, under the seduction that had led him to protect Maria in the past, decided to change his plans and travel, not to Seattle this time but to afuera, to the free port of Jebel Ali, together with Maria. Once at Jebel Ali, Maria asked him to have sexual intercourse with her. Her body, however, resisted any contact with William. When intending to kiss him she felt flu-like symptoms induced by a virus instilled in her at the clinic to prevent future liaisons with the forbidden man. ‘The Sphinx gave you a virus’, explained William. ‘Like what? An antiWilliam virus?’ replied Maria. ‘It’s involuntary, it’s like adrenalin. When you’re scared of something, your body gets ready to run away’, added William. ‘I’m not scared of you’ Maria replied. ‘I know but your body is’ said William. ‘I want you to make love to me. Make me make love to you. I love you’ whispered Maria. (Winterbottom 2003, 1:13–1:14) William helped Maria to act against her virus-induced-will by tying her to the bed. He then took her body and mind in what amounted to an act of rape against the world of Code 46. The morning after, Maria, following the instinct

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induced by the virus, got up and phoned the authorities in Shanghai to report a violation of Code 46. She did so as if requesting a service from a friendly authority. With a feeling of satisfaction for having done her duty she then returned to William who knew that they should start to run. While driving an old rented car through a desert road, they crashed in their attempt to dodge a caravan of camels and both of them lost consciousness. The crash site was soon visited by authorities responding to the Code 46 violation and both Maria and William were taken into care. After the incident, William was exonerated by a tribunal who decided that his actions had been induced by the empathy virus. As a consequence of the ruling, his memory of the events was removed and all he could remember was that he had crashed a car in Shanghai. He was then returned back to this wife and children in Seattle. Maria, in contrast, was exiled to the world of afuera and left to her own resources. ‘I was exiled because I tried to cheat the Sphinx. They left me my memories. They don’t care what you think if you’re outside. Why bother? To them, it’s as if we don’t exist’. (Winterbottom 2003, 1:23:41–1:24:02)

Capitalising fear Although a work of science fiction, albeit not a traditional one (Goss 2007), Code 46 reveals several aspects of the role that insurance in general, but life insurance in particular, plays in the valuation of life as capital. The film operates as a work of art that performs an immanent critique of insurance as a provider of security for contemporary liberal life, a critique that invites a reflection on its technological role in modulating agency, desire, behaviour, and responsibility. The film is an example of what Rancière referred to as ‘the aesthetic regime of the arts’, a result of the interrogation of critical artistic practices (Rancière 2004, 13).1 As analysed by Shapiro, the role of these ‘practices [is to] “disturb” accepted relationships between “the sayable and the visible” and […] effectively repartition the “distribution of the sensible”’ (Shapiro 2013, 13). From this perspective, critical artistic practices constitute sites for critical thinking, as put by Shapiro, ‘[t]o think rather than to reproduce accepted knowledge frames […] to create the conditions of possibility for imagining alternative worlds (and thus be able to recognize the political commitments sequestered in every political imaginary)’ (Shapiro 2013, xiv). Code 46 constitutes an aesthetic practice, by way of critique, of the overwhelming securitisation of life that results from a global insurance industry. Life insurance, a 2.65 trillion USD industry by 2014 (Staib and Puttaiah 2015, 34), is usually presented as a set of financial instruments through which the security of livelihoods and lifestyles can be protected. The industry defines life insurance as products used for the protection of incomes and lifestyles and

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the financial standing of families in case of premature death of the breadwinners. Operating a financial form of security that promises reparation in case ‘things go wrong’, life insurance is an industry that profits from the possibility of mobilising fear with regards to the death or illness of a breadwinner. Parents are constantly reminded of their duty of care towards their families’ future. The message is portrayed through advertisement with questions such as: ‘What would happen to your family or your home should you die unexpectedly? How would you and your family cope if you suffered serious illness such as a heart attack? If you were ill and off work for a long period of time, how would this affect your lifestyle?’ (RBS 2015). In other cases family protection is equated with the need to protect assets. Protection against fear towards the uncertain is not a one-off event; it is a life-long journey which the life insurance business transforms into a market for protection. An important insurance company in the United Kingdom uses as its motto ‘for the journey’ as a way to remind its clients that life insurance is part of a way of life, a life-long requirement/companion that generates ‘peace of mind’. For a couple who is beginning its life together and decides to buy a first home, Mortgage Life Insurance and Income Protection are presented as indispensable needs. As they enter their 30s, the couple who begin to have babies are reminded to revise their insurance cover to include a level Term Assurance plan and Critical Illness cover to provide for the needs of the growing family and anticipate life contingencies. When the couple enter their 40s a new form of life insurance with a savings element should be introduced, and in their 50s preparing for retirement might involve some form of annuity to cover the contingencies of old age. There is, however, nothing natural or innocent about life insurance and its promises. They are entrenched within political imaginaries of protection, imaginaries that entail institutionalised ways of understanding what it means to promote and safeguard a way of life. They are embedded within a very particular capitalist appreciation of economics in which insurance operates a technology of financial reparation by means of creating markets of security. Economy is here understood, following Daston, as ‘an organised system that displays certain regularities, regularities that are explicable but not always predictable in their details’ (Daston 1995, 4). The logic of these economies of security is not exclusive to insurance. It resembles other better-known and well-studied technologies of protection such as defence and national security, a resemblance that is locked into what others have analysed as a western metaphysics of thinking security (e.g. Dillon 1996; Campbell 1992; Neocleous 2008; Weber 2005). Whereas defence and national security operate upon the fear of threats to the stability and survival of states and of political regimes (e.g. Baylis and Wirtz 2002; Clausewitz 1989; Buzan 1991), insurance instantiates economies of security based on a different problematisation of fear: the fear of individuals and their families being exposed to the uncertainties of life and of the life-course (e.g. O’Malley 2004; Ericson, Doyle, and Barry 2003; Ewald 1991; French and Kneale 2009).

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The economies of security that result from insurance practices and imaginaries are developed and presented to the public as security portfolios to protect against the financial uncertainties derived from the unforeseen ‘events’ of life. The outstanding feature of these economies is not only that they are premised on an understanding of life as ‘evental’, a feature that calls for the interrogation of the conditions of possibility of its regularities. In doing so life insurance effects a translation of life into capital which can be invested and profited from. While operating economies of security, insurers extract value from the life-course (aging process) and life-potential (career and economic development) of their clients and transform them into investment capital. The instrument through which this process is possible is the insurance policy, a device that renders the life of the client fungible as a security that can be traded and exchanged (Lobo-Guerrero 2011). The policy, in turn, generates a premium, a cash payment which generates a flow of income which insurance companies invest into a portfolio of assets and securities to generate the funds with which to honour claims, but also to generate profit for the company stockholders (Kirova and Steinmann 2012). Francois Ewald, writing in the early 1990s, had already recognised this feature and noted that ‘[b]y objectivizing certain events as risks, insurance can invert their meanings; it can make what was previously an obstacle into a possibility. Insurance assigns a new mode of existence to previously dreaded events; it creates value’ (Ewald 1991, 200). This is not a new phenomenon in the liberal world. A quote copied by him from an insurance text written in 1884 is evidence that such an understanding of the role of insurance was already clear to commentators on the field in the late nineteenth century. Insurance is eminently creative where, completing the interrupted work snatched by death from the hands of the family man, it instantly realizes the capital which was to have been the fruit of savings; it is eminently creative when it gives the aged man with inadequate resources the pension needed to sustain his declining years. (Chaufton 1884, 209) The quote acts as a reminder that life insurance is and has been a central element in the history of liberalism, a phenomenon that invites a question on the relationship between life insurance and the creation of value under liberal regimes. Denoting regularity in the appreciation of life as capital, life insurance can be interrogated with regards to the role that the idea of ‘value’ performs in constituting economies of security. In creating this form of value, which could accurately be referred to as biovalue if the term had not already been colonised by authors such as Rose and Waldby when referring to the capitalisation of genes and human tissue (cf. Waldby and Mitchell 2006; Rose 2007), insurers perform a security effect in the form of moral economies. Moral economies are understood in this chapter as an efficient way of governing conduct collectively and from a distance. They are a form of economic

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government whereby the ‘common sense’ of individuals is acted upon, silently, to ensure an order with clearly defined rules and expectations. Making explicit what those rules and expectations are is not simply a matter of interrogating the terms and conditions of insurance contracts but demands an engagement with what gets sacrificed by insurers in the process of ascribing ‘value’ to life. The excess that results from valuing life as capital is not understood here as exceeding in amount or degree, but instead, as that which escapes the imaginaries and practices of valuation through which lived life and life-potential are rendered as capital, a remainder, which is not waste. Life’s excess is a source of resistance to the ensembles of power/knowledge that problematise and govern life (Vatter 2009; Prozorov 2007; Dillon and Lobo-Guerrero 2008). How to visualise that excess constitutes a challenge which is approached in the following section.

Valuing life as capital In the analytical narrative of the film offered at the beginning of this chapter, it is possible to identify three dimensions which are immanent to contemporary life insurance practices: valuation as a practice of inclusion, valuation as vital ontology, and valuation as the basis for moral economies. The first of these refers to its role in creating spaces of inclusion and exclusion, traditionally analysed in post-structuralist International Relations theory as the inside/outside (see: Walker 1988, 1993, 2010; Bigo et al. 2010). These spaces are however not geographically determined, although they are territorially related. They operate practices of governance in relation to the needs of circulation and interaction of the individual being insured. In so doing they operate a clear distinction between what forms of circulation are covered and which are not, for example, exclusions in life policies from traveling to particular countries and regions of the world. As clearly depicted in the film, inside spaces are those where risks are deemed manageable and controllable through technologies of insurance. The outside, or the world of afuera, is the realm of uncontrollable risks and feral uncertainty. The role of insurance in providing cover for some, and not all forms of circulation, including and excluding from cover some lifestyles (e.g. smokers, heavy drinkers) contributes to creating spaces of governance where activities and behaviours are relatively ‘secure’ and where reasonable expectations can be made of a future time. In so doing, however, a space of insecure governance is simultaneously constituted either as its radical opposite or as a gradient of opposition to the order of the insured world where insurers would try to penetrate while seeking market opportunities. Value in this respect acquires a dimension of inclusion, of including lives within a political community. Whereas the operation of insurance in constituting the boundary of inside/outside is usually ignored or neglected in political analysis, insurance establishes boundaries without which it would not be possible to understand zones of protection (Lobo-Guerrero 2012). Those

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insured are eligible for certain forms of circulation which are not accessible by default. Linking the idea of value to inclusion relates to the idea that only that which is considered valuable is worth protecting. An analysis of how value is constituted and how processes of valuation proceed is therefore a way to explore a condition of possibility for political community, a link which is central to the possibility of liberalism and needs to be explored in great detail. This element is intimately linked to a second one. Insurance, in its urge to render life fungible (i.e. amenable to trade and exchange) requires a vital ontology of value. Private insurance technologies, operating a principle of mutuality – or of actuarial ‘fairness’ (Stone 1993) – need an understanding of life that can be commodified. Livelihoods and lifestyles, as organic features of wider political economies, are under constant transformation and change. Insurers require a knowledge-base that informs them on what to expect from life, from life processes, life-courses and lifestyles. Finding a base on which to anchor expectation is therefore an existential angst for insurers. Traditionally this has been done by calculating the probabilities of occurrence of future events based on statistical records. History has been approached by mainstream insurance companies as a depository of facts that if properly mined and interpreted would provide the knowledge with which to inform their expectations.2 For example, in the case of life and health insurance products, issues such as family history have been used as an element with which to prognosticate health and life events (Rothstein 2004). Family histories of breast cancer, stroke, and heart disease, to name a few, are used as indicators of a heightened risk which translate, potentially, into higher premium levels. Immanent to that understanding of history is a desire towards a solid and irrefutable ontology to source actuarial practice as an evidence-based science. The hype on genetic determinism that followed the sequencing of the human genome at the turn of the twenty-first century, revealed, however, that such ontology would not be found by putting trust in a genetic imaginary (see: Baillie and Casey 2004; Brockett and Tankersley 1997; Cooper 2008; Liukko 2010; McGleenan, Wiesing, and Ewald 1999; Mittra 2006, 2007; Lobo-Guerrero 2011; Armstrong et al. 2003). If individuals were indeed genetically determined and scientific research could detail all the possible gene combinations and their implications in terms of future disease, insurers would only be approached by individuals with clear illness prospects. Not being able to balance good and bad risks, the business model on which private insurance operates would fail to work. In the world of Code 46, genetic determinism plays a double role as an ontological condition. On the one hand it becomes an instrument through which incest, as the unacceptable way of conceiving life, can be prevented and in the process decisions on who can procreate with whom can be micromanaged. An imaginary of genetic determinism gives rise to the authority to procreate. On the other hand, genetic determinism enables expectation. The Sphinx was certain that Damian Alekan had a predisposition towards Wards disease and therefore insurance cover to travel to Delhi, where exposure to bats would certainly kill him, should certainly be denied. Correlating the genetic

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make-up of individuals with the logical risks associated with specific genes allowed the Sphinx to protect its pool of insurable subjects from the dangers of risky environments and lifestyles. Belief in genetic determinism provided the ‘security of expectation’ that supports the very possibility of economies of security. Security of expectation serves as the pivot on which to anchor the valuation of life. With such a pivot in place it is possible then to design and develop insurance products to protect against normal and specialist risks. The third dimension through which life is rendered as valuable evident in the film is its role in aiding the constitution of moral economies. These differ from those enlightened secular ideas of morality derived from Kant’s categorical imperative and concentrate instead on the effects of organised systems of regular behaviour based on particular rationalities for the management of uncertainty. In this case, life insurance provides a technology that influences the behaviour of individuals and collectives down to the detail, which as illustrated in the case of Damian Alekan in the world of Code 46, relates to modulating the dreams and vital prospects of action carved deep into the subjectivity of insured lives. Such moral economies relate directly to Foucault’s idea of governmentality as the conduct of conduct and displace the focus of analysis from the government to the epistemology of governance where sets of ideas and beliefs underpin a logic supporting political action. The outcome of the moral economies of life insurance is the rendering of life as insurable or uninsurable and protecting the likelihood of loss, damage, injury, or death of insured lives. This rendering has of course profound implications in the lifestyles and livelihoods life insurance aims to protect and promote. A particular effect of this role is evidenced in the capacity of life insurance in repairing ‘damaged lives’ and getting them back in circulation. For example, and in a radical way, the world of Code 46 illustrates what happens to a life that has unknowingly breached the limits of acceptable behaviour if that life is protected by a life insurance policy. In the case of Maria, who slept with William in complete ignorance of their genetic incompatibility, life insurance provided the means to sanitise her behaviour and remove any traces of wrongdoing from her mind, a memory which might operate as an incentive or justification for future unacceptable behaviour. When the foetus and the memories of illicit procreation were removed from her mind, and a memory of an industrial accident for which she required an artificial finger was introduced in their stead, the Sphinx operated a technology of reparation which not only got Maria back into acceptable circulation. It also repaired the temporality upon which behaviour relied, the continuous present. Contemporary life insurance does not of course go to those extremes. It focuses instead on preventing, as much as possible, what is known in the industry as moral hazard and adverse selection. The former relates to risks derived from the unacceptable behaviour of a policyholder who seeks cover knowing there will be a certain claim. A radical example of moral hazard is a person who buys life insurance while wanting to commit suicide. To prevent that risk, companies tend to exclude suicide for the first two years of a policy

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under the understanding that someone who is thinking of taking their own life will not wait that long. Adverse selection refers to insuring lives that are known to be too risky and likely to cause costly claims. Those lives, however, are still insurable, that is, susceptible to be repaired in their capacity to circulate within a particular risk regime, for example, an obese person who is also a heavy smoker and consumes alcohol beyond the agreed safe standards established by the government. If insurable, and likely to be so at a high premium, that individual is probably asked to reduce their risk factors by, for example, attending a gym regularly, seeking help to quit smoking, or undergo therapy to control drinking (Swiss Re 2004). It might be the case that incentives are offered to that person in the form of a reduced premium if risk factors are reduced (Munich Re 2008). The likelihood of a higher premium or the possibility of being rejected completely from insurance cover if risk factors do not improve become an incentive towards ‘acceptable’ behaviour. If the financial standing of that person depends on the insurability of his/her own life, for example as security for (re)mortgaging the home or for providing financial protection for the family in case of death or old age, adapting to the moral order dictated by the insurer becomes an imperative. A more complex aspect of getting lives back in circulation refers to the insurability of lives in relation to activities considered to be of high risk and nonetheless in demand by certain populations (Laster and Schmidt 2005). A case in point is that of high mountain climbing which attracts entrepreneurs addicted to the ecstasy of pushing the capacity of their bodies beyond their normal boundaries (see Simon 2002). Activities of this kind are usually excluded from standard life insurance policies but are, regardless of the added risk, insurable under specialist policies. The very existence of these specialist products points to the fact that insurance does offer a great degree of flexibility to adapt to the changing demands of circulation of individuals seeking cover. For example, at the advent of space tourism in the early 2010s, a plethora of specialist products are being offered by the industry, sometimes in partnership with international organisations, to cover the uncertainties of space travel.3 Although some of these activities have historically been located in the realm of afuera (or of uninsurable risks), what the history of insurance institutions, technologies and products shows is an incredible capacity to offer forms of protection for the changing conditions of life. However, by rendering these limit lifestyles insurable, insurers expand the horizon of insurability influencing the behaviour of risk-thirsty individuals. This continuous widening of the moral economies instantiated through insurance effects a governmentalisation of life which must begin to figure prominently in studies of how liberal life is secured.

The ‘vital excess’ and the resistance to life’s valuation ‘Making reality intelligible’ by ‘showing [how] it was possible’ (Foucault 2008, 34) opens up the possibility to engage with the resistance of ‘life’ to the processes of valuation employed by life insurers.

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In Code 46 Damian’s wish to challenge the secure order of the inside world by insisting on going to see his bats, and Maria’s wish to disrupt the insurantial order of the Sphinx by creating windows to the afuera, constitute efforts to escape the biopolitical logic that supported the system. In the case of Damian it was made evident that insured subjects remain ignorant of the logics and reasons underlying certain underwriting decisions. When a quote on an insurance premium is offered, the client is not given the reasons why s/he was included in a particular risk pool and why the price quoted corresponds to that level of risk. This is not always a problem of fault or an intention to hide information away from the customer, although prominent cases of mis-selling of insurance products do happen (see Chapter 5). It is partly related to what can be called, following the mathematical instruments through which insurance premiums are calculated, ‘algorithmic logic’ (cf. Amoore 2007; Introna and Wood 2004). Algorithms are designed as instruments that allow for the calculation of multiple variables taking into account what is known about particular events and particular kinds of risks. Providing an articulated answer to why a particular quote was given would require analysing the not-so-technical processes that took place in the computing of data through the algorithm. This involves, for example, questioning the assumptions immanent to its design such as the three dimensions of valuation analysed in this chapter (i.e. valuation as a practice of inclusion, valuation as vital ontology, and valuation as the basis for moral economies). In the case of the film, both Damian and Maria remained ignorant as to why the Sphinx insisted on denying cover for a particular activity and in their own ethic had no problem disrupting the system once they had found a way of doing so. While disrupting the system the value ascribed to their lives changed, and in the case of Maria, whose life was deemed no longer worthy of protection, was left to exist in the realm of afuera deprived of the protection of insurance. Although the consequence of challenging the biopolitical order of insurance was exclusion from a political community ordered through the management of risk, resistance to that order highlights the excess to the biopolitical valuation of life. Love, thrill, adventure, feral dreams. The case of Maria and William’s ‘rape’ of Code 46 highlights the role of the vital excess as the core of the artistic performance of this film. William, in a professional capacity, was in effect playing the role of guardian of the insurantial order that companies such as the Sphinx produced. His duty was to identify fraudsters and denounce them so that the system could correct itself. When investigating the fraud case for which Maria was presumed guilty, he fell in love and by liaising emotionally with the culprit ended up contributing to what amounted in the film to a capital violation of order. Maria, on the other hand, knew through her father’s and own experience what living afuera meant and nonetheless decided to help others either get inside or outside as their wishes – and passions – commanded them. For her the problem of access/non-access was not a moral one but one related to holding the right certificate, the papel, something she could produce for them if she wanted.

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When William and Maria decided to travel together to Jebel Ali – the symbol of the free afuera in the world of Code 46 – they did so knowing they were violating the biopolitical order. William’s decision entailed leaving his family; without cover he would not be able to return to Seattle. Maria, who had been made to forget she had a history of disrupting order, was now wilfully running away from her job driven by the adventure of loving William and getting away from the boredom of life. When Maria asked William to make love to her, to make her make love to him, she did so driven by the thrill of enjoyment, adventure and pleasure of being in control of her body and mind, a control that eluded her regular and secure, insured life. They both chose to engage in the crazy adventure of ‘raping’ the system to be able to enjoy the satisfaction of their liberation from the norm that the insurantial order in which they lived imposed on them. The everyday routine of waking up and going to work and then getting back home to a perfectly regulated apartment was to be disrupted by the enjoyment of uncertainty of life in the world of afuera, the unregulated chaos in which life exceeded the biopolitical constraints of the world of Code 46. In the world of contemporary life insurance, the life that escapes the calculability employed by the algorithmic logic is anchored to an economy of security which simultaneously offers opportunities for profit while liberating the uncertain from the markers of ‘security’ against which it is formulated. It provides a market space towards which insurers can expand in their endless appetite for creating value within a capitalist system. Uninsured lives constitute a horizon to be colonised and can be as infinite as insurance entrepreneurs want to see it. Uninsured life and lives, be it because the logic of insurability has not yet encompassed them or because they have not been identified as potential targets for insurers, constitutes in other words opportunities for profit. On the other hand, uninsured life and lives represent a space of freedom, a space of wild uncertainty where anything is possible, where anything could potentially be achieved, where the magical stands a chance. It is a space for a romantic understanding of being, where the possible, and not the risky, norms the opportunity for happiness. In this way, the very insurability of life and lives constitutes a paradox of security. The paradox results from a dual process in which insurance seeks to promote and protect a particular way of life but it is precisely what gets excluded from that life in the process of securing it, which enables the operation of the technology. Put differently, it is the excess of the life to be protected that makes insurance possible.

The political economy of ‘excessive’ capability It was argued in Chapter 1 that the life object of insurance is one understood as capability. Capable life was presented then as a life endowed by a past experience and as life that could be demonstrated to be capable of being in a particular way in a projected future. Capable life is a life that can be

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prognosticated and therefore designed into a future. Capable life is manageable and is understood in terms of achievable expectations. In other words, capable life is insurable life. Reasonable doubts on the capability of life to achieve a designed future would render such life uninsurable or insurable subject to underwriting conditions. Code 46 narrates a story of defiance to this understanding of insurable life. The life of Damian and Maria, and the role of William after having defected his role of consultant, is no longer a life that can be understood in terms of capability. These lives have instead become driven by the potential that had been until then restrained by the complex moral effects of life insurance as the rector of their existence. The rape, William’s defection, and Damian’s escape into the outside, constitute revolutionary events in the order of the real that the Sphinx, as the governing institution, through the agency of insurance, had constituted. As revolutionaries, all three sought to experience a life of passion and desire as opposed to one of control environments, regulated actions, and regimented thought. Their revolution, however, was an individual one. The effects of their action had already been considered within the system as manageable through specific procedures. In the case of William, since it was his first act of misconduct against the system, lenience was had and he was reincorporated into his life of capability, albeit, without the memory of his act of defiance which was scientifically extracted from his brain. In the case of Damian, he was left to face the logical consequences of being exposed to an environment which the Sphinx knew would lead to his death. In this case, the Sphinx’s action constituted a typical biopolitical case of not killing, but letting die. The case of Maria, however, was more complex. Maria was a re-offender. She had already been shown leniency and her actions proved she had the intent to continue defying the system. The system had already intervened as a consequence of her unbeknown violation of Code 46. Her new offence, however, was a conscious one which demonstrated that her life was no longer worthy of insurance. Without insurance she simply could not live in the inside world so she was left to fend for herself in the uninsured outside world. In Chapter 2 it was noted that the moral economy of life insurance contributes to the creation and operation of a specific kind of political community, one characterised by a politics of capability. Capability requires assessments, measurements, prognostications, planning, even modelling. Such a politics is one where expectations result from calculative practices. Calculative practices are already the mechanisms through which insured lives are expected to become what they have been designed to be. It is a politics of order, of controlled progress. Within this idea of progress, uncertainty is understood in its negative definition, as described in Chapter 2, where an uncertain future is taken to be dangerous, where exposure to the unknown and the unknowable represents a threat to stability and order. Progress is an orderly consequence of well-established and undoubted premises and is considered to be a collective endeavour where risky private initiatives are to be discouraged and controlled.

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The politics involved in Maria’s, William’s, and Damian’s resistance to the insurantial order of the world of Code 46, implies a different kind of politics. In this case it is a politics of potentiality. It was noted in Chapter 1 that potentiality refers to a different mode of reasoning from that of calculability. It is not the result of assessing circumstances but rather leaving life open to creativity and resourcefulness. It is a life understood as a continuous becoming instead of taking life as what is. In this respect assessing potential would be a misnomer. A politics of potentiality engages with undetermined experience. It is not an extrapolation of memory from the past but an active engagement with undetermined possibility. In this respect, a politics of potentiality breaks away from prescriptive logics and assumes a present as an open world where anything can happen. The future is not so much a concern in as much as it cannot be prognosticated. Rather than being concerned with designing life, a politics of potentiality fosters heterogeneity and diversity in thought, imagination, and action. The ontology of this kind of politics is never fixed, but continuously emerges. Life is not caused, it is not predictable, it is a realisation, an event that continuously surprises order. What is excessive in a politics of capability becomes the decisive factor in determining a politics of potentiality. The world of Code 46 is of course, fictitious. The separation between capability and potentiality is not as clear cut as it appears in the world of the film. However, such a contrast allows for an observation in the real world of life insurance. What gets insured, the capable life that gets protected, is always prone to becoming ungovernable. Insured subjects can change their minds and behave in ways which are not ‘covered’ by the terms of their policies. Moral hazard is a phenomenon insurers are constantly aware of at all times. When a claim is made clients are presumed to be at fault and an investigation, through a claims adjustment, follows. This is an important issue since insurers know that the lives they claim to promote and protect can always be otherwise, that there is potential for deviance from the order of insurability they instantiate. The order of the real insurers render is not infallible, it is continuously exposed to resistance and offence. It is not necessary if the premises upon which it operates are challenged and defied. Defiance to an insurantial order, however, has deep consequences for the operation of liberal life. Liberal imaginaries, as discussed in Chapter 2, require a double meaning of uncertainty as simultaneously negative and positive if order is to be maintained and developed. This understanding of order is never a static one, it requires continuous agency to be made to work. The metaphor of a bicycle comes to mind where what maintains the vehicle upright is the balance that results from pedalling. No pedalling, no balance and the bicycle will end up on the floor. Metaphorically speaking this is what happens to liberal imaginaries if the technologies through which a liberal order is produced cease to operate. In the case of insurance, if an insurantial order ceases to operate as a result of resistance, the life object of insurance, the liberal life, ceases to become a governed subject. Financial and political consequences might derive from these actions. If collectively resisted, the

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challenge to the system could amount to a revolution where the foundations of an insurantial order of governance and rule would collapse. Such observation allows for an analysis of the form of transcendence at play in life insurance. Transcendence in this case relates to the stability of the system of governance and the preservation of the moral economies it produces and relies on. This transcendence acquires a technological character in the sense that it depends on repetitive practices that require a logic determining the rules on which it can operate. If those rules are challenged, as analysed in Chapter 6, the logic needs to quickly readapt in order to be able to continue to render an order of the real. Transcendence in the case of contemporary liberal imaginaries relies then on the capacity to remain in control. The potentiality of life can always signify a challenge to such an endeavour and the challenge must not be taken lightly in as much as it signifies the very possibility of order and rule resulting from an insurantial order. This form of transcendence supports a form of political economy which cannot be understood from the perspective of the institutions that uphold it. It is a political economy that can be observed through its performativity. One in which decisions on who gets what, how, and when, are a correlate of the epistemological formations on which an economic system operates, as discussed in Chapter 2. Understandings of liberal imaginaries tend to bring to mind the idea of the markets as those in which and through which goods and services are produced and allocated. What the transcendence of life insurance indicates, however, is that such markets need to be produced and made to work through technological agency. Markets do not result from a priori conditions that cannot be challenged or doubted. They are instead myths that operate as principles for a rationality that assumes them to be the core for order in economic systems. What cannot be challenged, if they are to remain operative, are the norms that allow technologies such as life insurance to operate. Challenge to those norms does not need to come in the form of an affront against the norm itself, but in the case of life insurance, by living a life driven by passion and affect rather than the rational calculability of actions and thought. The challenge is not one that needs the orchestration of collective action, as in traditional understandings of revolution. It can come through the simple emotional decision of individuals to live lives which are driven by desire and emotions that might not make much liberal economic sense but that might make their life more liveable. What is at stake in this kind of resistance is the transcendence of a liberal way of life. Liberal imaginaries and the systems of governance and rule that support them, however, have a history of over three centuries of continuous adaptation to transformation and change in the forms of ways of life. From mercantilist liberalism, to industrial and later financial capitalisms, what liberalism does is take stock of the premise that it is the interest of individuals and collectives, the maximisation of utility, that drives behaviour. What if individuals ceased to appear to be governed through interests? What if, rather than calculative beings, there were an alternative political economy where

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desire and passion found an alternative way of organising the generation and allocation of goods, ideas and services. The premises upon which such an economy could operate are for the moment not known, but in a similar same way in which E.P. Thompson spoke of moral economies as what supported peasant uprisings in late eighteenth century, creating a parallel understanding of price within markets, it might well be that alternative systems of values might emerge that could support the development of different political communities than are known at the moment.

Notes 1 The aesthetic regime of the arts has been explored within International Relations with regards to film, most notably by Shapiro. See e.g. Shapiro 1999, 2009, 2013. 2 A distinction must be made here with specialist forms of insurance which demand specialist underwriting. These are used to insure against new events such as machines based on or exposed to new technologies (e.g. nanotechnological devices) and are underwritten at specialist markets such as Lloyd’s of London (see Maynard and Baxter 2007). 3 A case in point is that of ‘Allianz Global Assistance’, a provider of travel insurance and assistance solutions, which has entered into partnership with the International Space Transport Association (ISTA) anticipating the growth of space tourism. See www.allianz-global-assistance.com/corporate/, accessed 30 October 2015.

4

Capital securitisation An emerging order in the valuation of life

Understanding the matter of insurability as a problem of governing uncertainty has led to thinking of ‘the event’ as the object of insurance. How the event is understood and conceptualised determines to a great extent the ways in which its related uncertainty will be rendered. This, in turn, will determine how such uncertainty will be managed. Although this idea has been widely explored with important nuances by various scholars, what has not been discussed in great detail is the problematic idea of temporality and the role time plays in helping constitute the event object of insurance. This problem is of great relevance for pushing forward the debate on the limits of insurability. The empirical cases used in this chapter, Swiss Re’s Vita and Kortis, launched and developed during the last decade, relate to hedging the exposure of life and health insurance portfolios to events that would generate excess mortality and excess vitality. The schemes, as explored here, are not simply actuarial, although actuarial practice still figures prominently in their crafting. They involve the strategic articulation of varied forms of knowledge that enshrine particular understandings of time and produce the truth-base of insurable events.

The limits of insurability At the turn of the century a debate on what constitutes the limits of insurability began to develop. The debate has been posed mainly from two perspectives. One has followed the lines of the work of Ulrich Beck who has argued that insurability is constrained by the limits of actuarial calculation, an idea contextualised within his concept of reflexive modernity (e.g. Beck 1992, 1999, 2002a, 2002b, 2003, 2005a, 2005b, 2006; Beck et al. 2003; Rasmussen 2001, 2004, 2006, Bailes 2007; Ó Tuathail 1999; Heng 2006; Williams 2008). Another perspective, very broadly presented, relates to constructivist and hermeneutic reflections on how insurability has been a matter of managing uncertainty (e.g. Bougen 2003; O’Malley 2003, 2011; Ericson and Doyle 2004; Ericson et al. 2003; Aradau and Van Munster 2007, 2011; Lobo-Guerrero 2011; Collier 2008; Petersen 2008; De Goede 2008). For this position, the calculation and use of probabilities has been but one of the ways of rendering uncertainty manageable through risk. A main concern here has been to show that the limits of insurability are not solely actuarial, a

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position shared in this chapter (O’Malley 2002, 2004, 2011; McFall 2010, 2011; Bougen 2003; Aradau and Van Munster 2011; Ericson and Doyle 2004; Ericson et al. 2000, 2003). Central to this discussion is an understanding of the matter of insurability as a problem of governing uncertainty. The governance of uncertainty, as understood in this chapter, implies two important elements that make it relevant to interrogate how insurance is made, and in the process, understand the role it performs in securing what can be referred to as liberal forms of life (LoboGuerrero 2011). First, uncertainty can only be conceived from a position of (perceived) certainty. Uncertainty is thought of in relation to positions of relative truth that become objects of promotion and protection. Uncertainty in this respect is not an abstract construction but a correlate of discourses and practices of truth. The second element is that the relative truth from which uncertainty derives is actively constituted through knowledge discourses and practices. Its relative character conforms to the fact that these discourses and practices change all the time, as will be illustrated with the cases of Vita and Kortis below. These knowledge discourses and practices are not natural in any way. The very fact that uncertainty is constituted as an object of governance reveals the precarious character of the truth-base on which perceived certainties are supported. It is therefore more appropriate to refer to knowledge discourses and practices of truth-making when seeking to understand how positions of certainty are determined. It follows that insurance can be interrogated in its societal role by exploring the truth-making discourses and practices that make it possible. In insurance practices it is the event object of insurance which is constituted as a matter of perceived truth. In a life policy, for example, an expectation that a policyholder will live to the age of 60 will be used to ascertain the uncertainties that could affect such expectation. Following the previous ideas, such uncertainties will be understood as the object against which protection is sought. So much is in principle clear in insurance practices. What remains to be explored is how the expectation of living to the age of 60 is construed as a truth that relies intensely on knowledge discourses and practices. Put differently, how the event is understood and conceptualised determines to a great extent the ways in which its related uncertainty will be rendered (cf. Romano 2009). This, in turn, will determine how such uncertainty will be managed. In traditional insurance products analysing the event object of insurance and its related uncertainties remains a relatively unproblematic task. When looking at more novel forms of insurance, such as the cases of life securitisation explored below, the challenge becomes more complex. Part of its complexity relates to the forms of temporality that result from the knowledge discourses and practices involved in providing the truth-base for the event objects of insurance. In the cases explored here, the knowledge discourses and practices at stake are part of the modelling process through which Vita and Kortis are constituted. The examples used in this chapter relate to schemes aimed at hedging the exposure of life and health insurance portfolios to events that would generate excess mortality and excess vitality. These schemes, launched by Swiss Re and

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known respectively as Vita and Kortis, are not simply actuarial, although actuarial practice still figures prominently in their crafting. They involve the strategic articulation of varied forms of knowledge that enshrine particular understandings of time. By interrogating the modelling practices developed for the schemes, the chapter explores the strategisation of multiple temporalities embedded in them. The idea of multiple temporalities was originally developed by Reinhart Koselleck and is useful for interrogating this phenomenon. Koselleck used the concept of Zeitschichten which he defined as ‘several layers of time of differing duration and differentiable origin, which are nonetheless present and effectual at the same time’ (Brunner et al. 1989, 9, as translated by Jordheim 2012, 157). These layers of time, when considered in the process of understanding the events of insurance, become productive elements in the constitution of the securities that result from financial securitisation schemes. As will be shown later, these layers of time are actively ‘strategised’ through modelling practices into what will be referred to here as ‘term time’, the temporal context of the event object of insurance. Strategisation is here used in Foucauldian fashion. It is understood as a productive logic, where as noted by him, ‘[t]he function of strategic logic is to establish the possible connections between disparate terms which remain disparate. The logic of strategy is the logic of connections between the heterogeneous and not the logic of the homogenisation of the contradictory’ (Foucault 2008, 42). The modelling process, in the case of Vita and Kortis, effects a strategisation of three orders of the temporal: diachronic, synchronic, and chronologic, temporal logics that will be defined later. This strategisation of time is a fundamental aspect of how an event is constituted as the object of insurance. The chapter proceeds in four parts. The first is used to provide some context on how insurable life has become the object of financial securitisation in the past three decades. It concentrates in showing how events otherwise considered to be un-insurable have been made insurable by focusing on the parameters around which they can be defined. It further shows how current life securitisation strategies operate a shift from the traditional risk-warehousing model of insurance/reinsurance relationships and become a means for hedging risks in the capital markets. The second part describes with some level of technical detail the particularities of Vita and Kortis, two novel life securitisation strategies developed in the past decade. Such thick description is necessary to proceed onto the third section which is used to reflect on the practices of modelling and the strategisation of time that takes place throughout these processes. It must be noted here that modelling does not constitute the object of this chapter. It is approached as the site where the three different temporal orders noted before become the object of strategisation as modelers constitute the time of the event against which hedging will be made possible. The chapter concludes with a discussion of the implications of thinking of the production of term time in relation to the debate on the limits of

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insurability and the implications for thinking the security of the form of life these securitisation schemes are designed to protect. It is intended as a provocation to further problematise the life object of protection and assurance.

The securitisation of life Life insurance securitisation is a financial manoeuvre where risks represented by insurance policies are pooled together and transferred to the capital markets in the form of bonds. It finds its origin as a technique pioneered in the United States in the 1980s (Helfenstein and Holzheu 2006, 3), which by the 1990s, as noted by Bougen, began to be employed as a risk mitigation strategy in the American life insurance industry (Bougen 2003, 254). By the turn of the century reinsurers had begun to explore ways of securitising life portfolios as a way of achieving capital efficiency by acquiring financial capacity outside of the traditional insurance sector (Helfenstein and Holzheu 2006). Insurers have employed securitisation as a way to push the limits of insurability towards the area of catastrophic risks, those risks which have traditionally presented insurers or pools of insurers, with potential liabilities in excess of their financial capacities. Typical examples of these are earthquakes, tsunamis, nuclear accidents, and health pandemics (see, e.g. Bougen 2003; Lobo-Guerrero 2010; Grove 2012). When thinking about pushing the limits of insurability towards the catastrophic area, one of the historical difficulties for the industry has been to define these events in such a way as to render the uncertainties surrounding their occurrence manageable. The way the industry has begun to do this is by shifting the concept of the insurable event from the phenomenon itself to a proxy. The proxy in this case is a parameter that when breached can give rise to a claim. They have called this ‘parametric insurance’. In contrast to traditional insurance, where a claim takes place once the insured event materialises, parametric insurance policies are used to insure against a threshold within an index (e.g. the Richter scale or the WHO six-stage classification of pandemics). In the case of earthquakes, what is insured is any seismic activity, for example five points in the Richter scale within a specified period of time and a clearly defined geographical setting. Parameters are here used as an attempt to ‘objectively’ define the catastrophe for which cover has been bought. In the financial markets the opportunities opened up by securitisation were promptly identified and developed and as the decade advanced, financial agents celebrated the promises of life securitisation. By 2006, PricewaterhouseCoopers, a global business-consulting firm, was presenting the opportunities of these strategies in the following terms: Securitisation of life insurance portfolios could provide a valuable source of financing for acquisitions and other strategic investments by releasing the embedded value from blocks of business.

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Capital securitisation The development of securitisation is significantly increasing the life insurance sector’s access to the financial markets. This could eventually create a liquid market in life portfolios, which could in turn have a far-reaching impact on financing arrangements and the cost of capital. Securitisation could potentially facilitate a fundamental shift in life insurance business models, with manufacturers taking on the role of intermediaries that underwrite and package risks before transferring them to the financial markets. (PWC 2006, 1)

Although this quote refers to the opinion of one company, it expresses the widely accepted position of the industry that by ‘releasing the embedded value’ of life portfolios, securitisation would instil liquidity in the sector allowing life portfolios to be used as finance for other ventures (e.g. Cowley and Cummins 2005; Kohli 2006). A result of these practices would be the transfer of risks held by insurers into a new tier of finance. This has been presented as a means to broaden insurantial capacity which would enable insurers to undertake bigger risks and also to achieve financial efficiencies. As noted in a Swiss Re report on the opportunities of securitisation for the reinsurance industry, ‘[b]y selling risks to investors, insurance companies reduce their need to hold capital and increase their ability to write new business. Some securitization structures also provide ancillary tax advantages’ (Helfenstein and Holzheu 2006, 3). By 2011, the principle of life insurance securitisation had already developed into a powerful mechanism with which to transcend the traditional insurance business model based on originating and holding liabilities – the ‘risk-warehousing model’ – into one in which they originate and transform liabilities into securities which they then trade in the capital markets (Berry 2007, 4). In the riskwarehousing model liabilities would remain within the insurance-reinsurance relationship; in the securitisation model liabilities are packaged and transferred through bonds to the capital markets representing a shift in the traditional actuarial understanding of insurance (see Cowley and Cummins 2005). What is transferred to the capital markets is not the risk underwritten by insurers and reinsurers but the exposure of these agents to thresholds in parameters used to define events such as pandemics, terrorism and war, or significant increase in the longevity of insured lives. As such, life securitisation does not constitute a new tier of insurance. It is instead a strategy for hedging risks, a strategy that builds security into existing insurance and reinsurance schemes. The first decade of this century began to witness a great degree of creativity in the development of life securitisation strategies. Two examples described in the following section illustrate how the risk securitisation model has been operated. The description will be used in a subsequent section to explore the strategisation of time at play in the two schemes paying particular attention to how the time of the event contributes to the constitution of the object of insurance.

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Securitisation of excess mortality and vitality: Vita and Kortis The first securitisation scheme was that of excess mortality issued by Swiss Re in 2003 and which received the name of Vita I. The scheme began with Swiss Re entering into an agreement with a special purpose vehicle (SPV), Vita Capital Ltd., a Cayman Island company purposefully created for the venture. The agreement involved risk coverage during four years starting in 2003 through 2006 and used a pre-determined mortality index specifically adapted to Swiss Re’s global portfolio. This index was based on the published population mortality for 2002 in the US, France, the UK, Switzerland, and Italy, weighted by country, age and sex (Standard & Poor’s 2003, 3). The base year used for the index was 2002. As a parametric scheme, claims would occur once a trigger event (parameter) was reached, and the trigger set for this case was an index exceeding 130% or more of the base index. The total amount covered was USD 400 million and it was supported by the issue of USD 400 million of notes with a Standard & Poor’s (S&P) Rating of A3/A+. The proceeds were deposited in a collateral account managed by ‘a highly rated counterparty’ under a figure known as ‘asset total return swap’ (Berry 2007: 8). In the case of a triggering event (i.e. a pandemic), the collateral would be sold and the claim made by Swiss Re honoured. If no claim was made, the collateral would be liquidated at the end of the term and investors would be repaid (Berry 2007, 8). S&P defined the risk of the scheme as ‘Catastrophic mortality in five welldeveloped countries’ (US, France, the UK, Switzerland, and Italy). The rating assigned to the scheme was of A+, which, as expressed by S&P, reflects some level of susceptibility ‘to the adverse effects of changes in circumstances and economic conditions’ but also reflects the strong financial commitment and capacity of ‘the obligor’ ‘to meet its financial commitment on the obligation’ (Standard & Poor’s 2011b). The calculating agent, that is, the provider of the model upon which the risk was measured, was Milliman Ltd., a company based in the United States with operations in the United Kingdom. Their model was based on the assumption that the trigger of 130% in mortality would be reached in case of an excess of 800,000 deaths between January 1, 2003 and December 31, 2006. The source of mortality data to be used for the index was the national agencies of the countries involved, such as the UK Office for National Statistics and the US Centre for Disease Control and Prevention and the National Centre for Health Statistics and their equivalents in the other countries. It also considered the pool composition, which, according to the S&P presales report, reflected an exposure to mortality risk spread across ‘five well-developed countries and a strongly diversified population of various ages and both sexes’ (Standard & Poor’s 2003, 4). 70 per cent of the pool corresponded to the US, 15 per cent to the UK, 7.5 per cent to France, 5 per cent to Switzerland, and 2.5 per cent to Italy. 35 per cent were female and 65 per cent male and a particular weighting was established to the age distribution.

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Another significant aspect involved in the model was the consideration of historical records of excess mortality. For example, the 1918 influenza pandemic was noted as having generated 33 per cent increase in mortality that year. Other events such as natural disasters like earthquakes, tornadoes, and hurricanes, as well as the two World Wars and epidemics such as AIDS and some terrorist attacks were considered. Second to the 1918 influenza pandemic, World War II was noted as having caused the highest excess mortality which corresponded to 6.5 per cent in 1940. Other than those two cases no other historical cases were identified as having had the capacity to trigger the limit of 800,000 deaths of excess mortality and were therefore dismissed (Standard & Poor’s 2003, 5). The rating agency stated that it was their belief that only an event such as sustained nuclear, chemical, or biological terrorist attack or a substantial epidemic that escaped quick detection could cause a persistent 10% deterioration in annual mortality for three consecutive years and thus could cause a loss for the note holders. The epidemic risk is mitigated by advances in disease control and prevention as well as developments in health care technology. Standard and Poor’s views the likelihood of this type of pandemic occurring again to be extremely low. Generally speaking, terrorist attacks and epidemics tend not to cause a statistically large number of deaths (Standard & Poor’s 2003, 5). Based on the quantitative results provided by the modeller (Milliman) and ‘a combination of qualitative views on catastrophe mortality based on historical events and current environment’, S&P assigned a probability of the model generating a value exceeding the 130% mortality rate of 0.704%, that was assuming no mortality improvements (Standard & Poor’s 2003, 5). The model was designed to calculate probabilities of ‘catastrophic mortality’ which resulted from combining results from three separate models (data based on Bagus 2008). First, a Baseline Model including expected mortality, expected volatility, country-specific time series using historic data on mortality events with pre-determined age and gender weights was devised. Second, a Pandemic Model including additional mortality due to potential disease calamity, as well as event frequency and severity, was applied for the countries covered by the programme. The actuarial model was based on a ‘frequency and severity’ approach. Frequency and severity were modeled separately based on historical occurrences of influenza epidemics. The frequency was set at 7.38 per cent per annum based on 31 influenza epidemics over the last 420 years. It was assumed that disease epidemics occur in all countries at the same time with the same severity. Severity data was based on US population experience and applied proportionately to other countries. There was a seasonality element which was modelled using a ‘multiple-state model’ based on epidemiological progression of influenza during a typical influenza season (Bagus 2008). Finally, a Terrorism Model was involved which included additional mortality due to potential non-disease events. Milliman ran 250,000 simulations for each of the three models using Monte Carlo techniques to generate a series of scenarios.1 The resulting model

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combined baseline scenarios with disease scenarios and war scenarios and converted country-specific mortality to a country index for each possible scenario. Finally, the model incorporated the country-specific indexes into a combined index to be used as the referent for the scheme. Simulations on that Combined Model generated probabilities of loss, probabilities of exhaustion of the funds for the scheme, expected losses, and average losses. The Vita Capital series evolved since 2003 and has had four subsequent phases. Vita Capital II (2005) and Vita Capital III (2006) followed a similar modelling structure to that of the first series. For Vita Capital IV, a substantial change was introduced. This time the model was developed by a different company, the US-based Risk Management Solutions (RMS). In contrast with the Milliman model where historical trends going back 400 years were considered, this new model would focus on mortality as it emerged (i.e. ‘current trends’). To achieve this the index would be of an emergent kind resulting from periodic measurements taking place every two years. It would be used to calculate, this time, a compound index. The scheme issued several series of notes and for the III and IV, as well as V and VI series (October 2010 to August 2011), the compound model included a baseline model to reflect the expected mortality and variations in mortality during normal times when no excess mortality occurs. A second model, a disease model, was used to reflect ‘additional mortality that could result from the outbreak of certain infectious diseases, including the risk of pandemic influenza and emerging infectious diseases’ (Standard & Poor’s 2011a, 8). A third model added to this scheme was one of earthquakes to reflect ‘additional mortality that could result from the occurrence of severe earthquake events in the U.S. and Canada’. Finally, a probabilistic terrorism model was added for Canada, Germany, the UK and the US to ‘reflect additional mortality that could result from the occurrence of severe non-military acts of violence’ (Standard & Poor’s 2011a, 8). Other factors, such as tsunami risk in the US were dismissed as ‘not critical for assessing the probability of default of these notes’. According to RMS, its model has taken into consideration the latest developments in medical research, medical trials, as well as clinical data to develop its scenarios. A significant innovation has been the inclusion of published government containment plans, part of governments’ resilience strategies and preparedness schemes, as resources with which to qualify levels of risk. The second securitisation strategy, known as Kortis, related to the creation of longevity bonds. According to an estimate by the UK Government Actuary Department cited in a Swiss Re document, ‘in 2011 a 65 year old woman in the UK can expect to live 20.9 years more and a 75 year old 13.1’ (Swiss Re 2011, 7). According to the RMS website, ‘65 year olds are currently gaining a year of life expectancy every four years’ (RMS 2013d). The calculation of these figures and how they will change in the future constitutes a great actuarial challenge for which medical advances as well as lifestyle changes are key. A Swiss Re document on longevity quotes, for example, ABC News and Med Page Today’s top-ten US medical advances between 2000 and 2010, including:

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‘human genome discoveries reach the bedside’, ‘doctors and patients harness information technology’, ‘anti-smoking laws and campaigns reduce public smoking’, ‘heart disease drops by 40%’, ‘stem-cell research: laboratory breakthroughs and some clinical advances’, ‘targeted therapies for cancer expand with new drugs’, etc. (Swiss Re 2011, 7). These advances denote the shifting context under which longevity is to be understood. The insurance industry is of the opinion that longevity is a fact with direct implications for the pensions industry, especially in the area of annuities which affects insurers directly. If Fries’s thesis on the compression of morbidity is valid, the situation is even more dire. He has argued that ‘if the average age at first infirmity, disability, or other morbidity is postponed and if this postponement is greater than increases in life expectancy, then cumulative lifetime morbidity will decrease – compressed between a later onset and the time of death’ (Fries 2003: 139) (see also: Fries [1983] 2005; Fries 2005). The health insurance sector is actively seeking ways in which to provide expensive cover through longer life spans. Based on such concerns, Swiss Re devised a second securitisation strategy, an instrument with which to hedge against longevity risk in the US and the UK. The scheme was launched at the end of 2010. Kortis Capital is also a special-purpose company incorporated under the laws of the Cayman Islands. The most significant aspect of this strategy was the novelty of its bonds. Their aim, as stated in the presales report produced by S&P, is ‘to pass longevityrelated risk (the risk that people live longer than expected) to the capital markets’ (Standard & Poor’s 2010, 3). It covers a period of eight years from January 2009 until December 2016. As explained by S&P to potential buyers, ‘the trigger is defined at the outset and calculated based on the entire eightyear risk period. The probability of a loss attaching and the magnitude of the loss in principal will depend on the extent to which the difference in mortality improvements between the geographical age-groups exceeds the attachment point for the notes’ (Standard & Poor’s 2010, 3). As in the Vita cases, the index is constructed using published population mortality data from the countries’ government agencies. The transaction was devised in the following way. Swiss Re and Kortis entered a contract whereby Swiss Re made ‘payments in exchange for protection against a greater-than-expected change in the differential between the mortality improvement of older U.K. (England and Wales) males, aged 75–85 inclusive, and younger U.S. males, aged 55–65 inclusive’. The trigger was based ‘on the difference between the U.K. index (annualized mortality improvements in the U.S. age group) over eight years of mortality improvements’ (Standard & Poor’s 2010, 4). Kortis issued floating-rate notes to investors. Proceeds from the sale of the notes were invested in AAA rated IBRD notes and deposited in a collateral account until the end of the period. If at the end of the entire risk period of eight years the longevity divergence index value exceeds the specified trigger level, a payment will be made to Swiss Re by selling the collateral (Standard & Poor’s 2010, 5). If no claim is made the collateral will be sold and the investors paid their share.

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The transaction is based on a model provided again by RMS which used two model components for its risk analysis. First, a longevity model that ‘reflects the expected mortality and variations in mortality during normal times when no excess mortality event occurs, driven by the various categories’. The second was an infectious disease model that ‘reflects additional mortality that could result from the outbreak of certain infectious diseases, including the risk of pandemic influenza and emerging infectious diseases’ (Standard & Poor’s 2010, 7). For its model, RMS divided ‘causes’ and ‘drivers’ of death into five ‘vitagion categories’ ‘(lifestyle, health environment, medical intervention, regenerative medicine, retardation of aging) and catastrophe, and various categorizations beneath them’ (Standard & Poor’s 2010, 7). The modeller then projected deaths from each vitagion category every year in its base model to assess the probability of default on the notes. S&P assigned a rating of BB+ to the notes issued under the scheme.

Modelling and the strategisation of time Koselleck’s idea of multiple temporalities, involving simultaneous layers of time with different duration and origin, is a useful intellectual resource from which to explore three different temporal logics at play in the constitution of the ‘excess mortality’ and ‘excess vitality’ events of Vita and Kortis. These logics were for Koselleck diachronic and synchronic (Koselleck 1989, 2002). A third logic is considered in this chapter, that of chronology. Although these are intellectual categories that are anchored in particular understandings of the event, and are therefore bearers of history, they are here employed as intellectual instruments from which to begin to explore the epistemology of the time of the event object of insurance. A diachronic logic is concerned with the development of phenomena over time. It resorts to records and accounts to reconstruct the history of experiences (e.g. Eckardt et al. 2003; Hendery 2012). A synchronic logic refers to phenomena in a particular moment in time without giving too much credence, or no credence at all, to historical antecedents (cf. Hall 1980; for a critique see Althusser and Balibar 1970, 96). Chronologic time is understood here as the ordering of the temporal as a sequence of events, sometimes expressed in the form of periodisation (e.g. Rescher and Urquhart 1971; cf. Davis 2008). As logics for ordering thought, these three categories relate to the rules of formation that constitute systems for rendering the temporal intelligible. Those rules of formation relate to ways of knowing the world, to the great problem of understanding the constitution of ‘orders of the real’. They do not determine time but are instruments through which to make sense of the experience of time. In securitisation schemes such as the ones noted above, temporal orders vary and throughout the modelling process decisions are made on how to strategically combine them. The result of this active strategisation of multiple temporalities is interpreted in this chapter as giving rise to the time of the insurance event, ‘term time’. Indeed, events are constituted as unique through the production of term time.

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Modelling, due to the logics and practices of representation involved, is not a simple phenomenon and has traditionally been a site of intellectual contestation in the philosophy and history of social science (e.g. Hegselmann et al. 1996). The epistemology of modelling, however, has been particularly absent in actuarial studies (Jarvis and Jakhria 2012, 1) although it is in actuarial practice, not simply a matter of number crunching, where modelling becomes a central instrument of power. Actuaries, if technically-minded, might not be aware of the influence they have in shaping the events they are to work with or of their role in constituting the time of such events. They are aware, however, of the simplifications made in their modelling practice, as the following quotation from two practising actuaries illustrates. A model is necessarily a simplified representation of the real world. The process of stripping down to the bare useful components and ‘calibrating’ the resultant model has (necessarily) got a large amount of judgement associated with it. This judgement can manifest itself in various different ways. Broadly speaking, some of the ways we encounter decisions over the process of actuarial modelling: Choice of overall framework for the model, choosing individual parts of the model (e.g. distribution), choice of calibration methodology, choice of parameters, overriding certain parameters if necessary. (Jarvis and Jakhria 2012, 5) There is debate as to what the role of modelling is in relation to the reality it is expected to serve. Gordon, in his reflections on the philosophy of social science noted, for example, that ‘the purpose of any model is to serve as a tool or instrument of scientific investigation’ (Gordon 1991, 108). In his opinion, ‘[t]he real test of a model is … whether it works effectively as a scientific instrument, not the degree to which it replicates the real world’ (Gordon 1991, 108). Morgan, in contrast, argued that modelling is a historical process that relates to styles of reasoning: ‘why a particular model is built, what questions it is designed to answer, and what uses it is put to, are historically contingent’ (Morgan 2009, 6). What is evident in the cases noted before is that modelling has a performative dimension, a dimension that is related to existing scholarship on the performativity of markets (e.g. MacKenzie et al. 2008; MacKenzie 2006). The particular effect of this role is its contribution to the enframing of insurable events. This relates in turn to a specific part of the modelling process, simulation. As evident in Vita and Kortis, the simulation of scenarios and the analysis of their frequency and impact, becomes a central element for the management of risk. Simulation, however, as noted by Winsberg, is not solely a matter of replacing an ‘analytical solution with calculation’, which he refers to as ‘a mere mathematical transformation’. ‘The question of the reliability of the results of simulation modelling goes beyond mere worries about the reliability of the calculation, and reaches out to the entire simulation process and the conclusions

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scientists reach using these techniques’ (Winsberg 2001, S447). Modelling implies responsibility in determining the order of the real upon which the results of simulations will operate. However, in modelling practices it is common to base this order of the real on existing theories, on theoretical understandings of phenomena. This constitutes an epistemological problem which Winsberg explains in the following terms. Typically, for a philosopher of science, epistemological issues arise when we try to justify high level theoretical claims based on low level data or specific observational reports. But simulation is about starting with theory and working your way down. This kind of epistemology is, to the philosopher of science, a curious beast. It is an epistemology that is concerned with justifying inferences from a theory to its application – an inference that most philosophy of science has assumed is deductive and consequently not in need of justification. (Winsberg 2001, S447) The epistemological issue at stake in this problem is that ‘the deductive inferences that take place in simulation modelling do not confer certainty in their conclusions’ (Winsberg 2001, S448). What they do, however, is relate to the logic of the theoretical structure upon which they were built (Winsberg 2001, S449). In this respect, what modelling practices do is reassert the order of the real that simulators project into their structures. A model becomes an analogy to the style of reasoning through which modellers project their imaginary into the world (Morgan 2009). There is of course not much novelty in this assertion. As Morgan noted when reflecting on Crombie’s account of modelling as a reasoning style, models ‘were built to represent the relationships – hypotheses by the early astronomers – between the earth and the heavens. They were carefully designed not just to present or illustrate known relationships but to demonstrate those relations that scientists supposed to be true (their hypotheses) and thus to explain how the universe was thought to be arranged and to work’ (Morgan 2009, 16). What is relevant in the assertion, however, is that the theoretical assumptions upon which models are built and operated are assumed to constitute the basis for the subsequent ordering of the world that results from modelling processes. As will be evident in the analysis offered later, this is not necessarily the case for Vita and Kortis. The performative role of modelling, although anchored on the rules of formation of the logics involved – the theoretical aspect, is not the result of logical combination. The combination that takes place during simulations exceeds those rules of formation; it becomes a moment of poiesis, the space where the strategisation of time takes place. The effect of the modelling process is a temporality that contributes to the definition of the event object of security. Nonetheless, much of the emphasis on contemporary modelling is put on devising equations through which the possible outcomes of combining multiple variables can be explored. This is where Lorraine Daston’s distinction

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between precision and accuracy comes into play. While writing about forms of scientific quantification in the seventeenth century, she noted that ‘[a]ccuracy concerns the fit of numbers or geometrical magnitudes to some part of the world and presupposes that a mathematical model can be anchored in measurement; precision concerns the clarity, distinctness, and intelligibility of concepts, and, by itself, stipulates nothing about whether and how those concepts match the world’ (Daston 1995, 8). Mathematical thinking and mathematical tools as a way to synthesise processes, are normally treated in modelling as a matter of precision. As noted by Thaleb, however, mathematics is ‘principally a tool to meditate, rather than to compute’ (Thaleb 2001, 41). ‘Mathematics is not just a “numbers game”, it is a way of thinking … probability is a qualitative subject’ (Thaleb 2001, 287). Probability, Hacking tells us, has had from its beginnings in the seventeenth century an a priori epistemic element related to degrees of belief, and an a posteriori ontological aspect related to the performance of randomising devices (Hacking 1975, 10). Coming back to securitisation strategies such as Vita and Kortis, Brockett et al. noted that, ‘[t]he modelling and forecasting of the mortality rate is the key point in pricing mortality-linked securities that facilitates the emergence of liquid markets’ (Brockett et al. 2010, 1). Modelling here becomes a matter of identifying the right price for the right level of risk, a central actuarial concern, a concern, that among other issues matters in providing the moral arguments on why financial practices are not to be considered forms of gambling (see, e.g. Clark 1999; de Goede 2005; Lobo-Guerrero 2012). Modellers do this, unaware of the epistemological implications of doing so, by deciding on the parameters that are to constitute the historical frame for the phenomenon under study. The result is the time of the event. Methodologically speaking, exploring the constitution of the time of the event through modelling practices allows for an account of both of Hacking’s epistemic and ontological elements and sets the space from which to think about how different logics of temporality are strategised into term-time. The historicity of modelling, through elements shown below, demonstrates that the production of term-time is not an automatic process but the result of careful strategisation. The Vita I–III schemes, based on the models provided by Milliman, focused predominantly on a combination of diachronic and chronological logics of time. Diachronical elements were for example the predetermined mortality indexes based on national statistics that took into consideration historical events such as the 1918 influenza pandemic, earthquakes, tornadoes and hurricanes in the twentieth century, the two world wars, epidemics such as AIDS, as well as terrorist attacks. All these events, identified through ‘factual’ records and treated as epistemic objects, were analysed by the modeller, to determine, as accurately as possible, the development of excess mortality throughout 400 years and explore historical trends. Accuracy here constitutes a subject for discussion. The factual quality ascribed to records can be opened

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to interrogation not least because of the diversity of events at stake, but also, and most importantly, because of the epistemological issues at stake when determining events themselves. The practice of counting of deaths in events such as a war or a hurricane in different historical moments will differ in character and the figures provided will represent a very specific reading of the events. Claiming these to be accurate is part of the truth-making practice of the modeller where an objective base is presented as the basis for legitimacy. Putting together disparate events such as environmental catastrophes, war, terrorism and pandemics contributes to help constitute a diachrony of death around which mortality indexes are construed. The problematic aspect of these indexes, however, is the isolation of factors constitutive of death, when, for example, it is well known that the so-called Spanish flu cannot be understood in isolation from the deterioration of conditions of life that resulted from the devastation and efforts of World War I. the diachrony, in this case, suits the model but claims for accuracy and the legitimacy of objectivity can barely be supported. The Vita I–III schemes are also supported on a logic of chronology where elements such as the consideration of the ages of individuals, the stage of these individuals within a life cycle (e.g. childhood, adolescence, adulthood, oldage), and the setting of the base year for the model on the year 2002 were taken into account. These elements, within the logic of the model, perform an ontological role in the process. However, elements such as age and the stages of a life-course are far from established bases for generalisation. Debates in gerontology suggest, for example, that aging is not solely a biological process but that involves as well social and psychological processes (Hooyman and Kiyak 2011). Stages of the so-called life-course are also relative to complex factors and changes in methodology give rise to different periodisations (Macmillan 2007). To assume life-course as a categorisation for the purposes of modelling might suit the process but will inherit, perhaps unknowingly, the epistemological load of the categorisation itself. In the need to constitute a chronology out of which the model can simulate future scenarios, modelers construe a projection of their own imaginary of the events dealt with. By combining these synchronic and chronological elements, the modelers were set to identify long-term trends and formulate scenarios around which frequency and severity could be calculated as precisely as possible. The event for which protection was to be offered became defined as one where 130% of mortality would occur in the defined countries between 1 January 2003 and 31 December 2006. Perhaps precise in the calculation but inaccurate in their assumption of the world, modelers of these schemes created a truth-base, a perceived certainty around which uncertainties could now be simulated. Vita IV combines mainly diachronic elements with synchronic ones. For the ‘stochastic model of peril process’ employed for the scheme, the modeller RMS employed a diachronic logic to consider recent developments in medical research, results of medical trials, and clinical data, to determine changes in mortality within the countries at stake. There is, however, a chronological aspect to such diachrony which relates to the decision to measure trends within two-year periods. Why such periods were chosen is not clear. What is

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clear is that it introduced a chronological element which performs an ontological role in the modelling process. The model also involved a synchronic logic in analysing the diachrony mentioned before. In other words, once the diachronical elements were identified they were analysed as synchronic. Additional elements were factored into the synchrony. For example, current government preparedness and resilience strategies to cope with excess mortality derived from infectious, environmental, or socio-political events were considered (on preparedness, see, e.g. Adey and Anderson 2012). By combining diachronic and synchronic logics, the aim of the model was to create an interpretation of ‘current trends’ to create a compound index against which the event that could give rise to a payment could be determined. The time of the event in this case is determined through the compound model at the end of the scheme. The strategisation of time in the case of Kortis, bearing in mind that this scheme was aimed at providing securities against excess vitality, is constituted in a different form. In this scheme the trigger is not determined at the end of the modelling exercise but it becomes its ontological element. Defined at the outset, it operates as a hypothesis to be proved or disproved throughout the process of maturation of the bond. It constitutes the basis for the hedge intended through the scheme. The model involves diachronic elements such as historical records on mortality explored in government statistics to identify current expected deaths. It also considers expectations on additional deaths as a result of pandemics. These elements are combined with synchronic ones such as lifestyles (lived life), advances in medical interventions, developments in regenerative medicine and successes in techniques for the retardation of aging, all of which are claimed by the modeller to be analysed in real time. The scheme also involves chronological elements such as the expected lifecycle of populations with the objective of identifying trends in the prolongation of mature age. Whereas in Vita I–III and Vita IV the trigger was decided through the modelling process and its output, in Kortis the trigger is expressed as an a priori assumption validated by a model that seeks to trace emerging conditions. The strategisation of term time, in this case, precedes the modelling experience. This analysis contrasts starkly with the ways in which modellers such as RMS market their modelling practices. For them, modelling is foremost a practice of representation that aims at simulating an accurate world whilst drawing on tools and techniques to do so as precisely as humanly possible. In their website they refer to their modelling ethos in the following terms. Model development at RMS is more than just number crunching; it’s a blend of science and art that relies on each developer’s ability to think critically and creatively. Fieldwork provides real-world experience that enhances our judgment and intuition. That means better models, better understanding, and, ultimately, better preparation for when the next disaster strikes. (RMS 2013a)

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Drawing on that ‘blend between science and art’, they further state their goal through their website in terms of giving ‘birth to a new powerful platform’, a platform of platforms ‘that is as fast, scalable, efficient, and powerful as anything available in the commercial market’ (RMS 2013c). In their careers section, provocatively entitled ‘our craft’, they describe the practice of modelling as striking a balance between perfection and reality, or, a ‘real’ that falls outside their order of the real. They are however explicit about the accuracy deficit in their modelling techniques. When presenting their catastrophe models they state, ‘[c]atastrophe models are hypothetical. Tragically, there are times when reality steps in’. When this happens, there is space for reflecting how accurate the model really was. In the wake of catastrophic events, risk modelers have a chance to see how well what we’ve modeled in a computer-generated simulation matches up with what happened in the real world. While we couldn’t do anything to undo the damage in [the Haitian earthquake of 2010], what we learned during our event response and fieldwork could contribute to improving our models, which are part of a broader strategy to help people mitigate the effects of natural hazards in the future. (RMS 2013a) When advertising their pandemic models, RMS note in their website, Infectious diseases are the leading cause of death worldwide. Influenza pandemics pose a major threat in today’s highly mobile society, as the 2009 H1N1 pandemic demonstrated. By modelling the dynamics of viral infectiousness and spread, and the impacts of vaccination and mitigation, this threat can be anticipated and understood. (RMS 2013b) What their modelling practice ultimately contributes is an agency of time, a performed temporality which enframes the existence of the security products generated through the schemes. Such temporality is the result of a claim for objectivity but also of a truth-making insurantial imaginary that requires generalisations as the basis for modelling. The certainty they claim to represent through the modelling process projects into a future the technological reality of the model fabricating the uncertainties of their own scheme.

The limits of insurability and the strategisation of time Term time, as the strategic temporal combination that results from securitisation schemes such as Vita and Kortis, is the technological outcome of modelling processes. Modelling, as argued above, is analysed here as a performative practice, one which is adopted as a matter of faith in method without much reflection given to what the politics of representation, implied

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in the method, involve. A model is not just ‘a simplified representation of the real world’, as Jarvis and Jakhria cited above argued. A model is instead a rendering of the world in the full sense developed in Chapter 2. It is not a ready-made rendering but one which expresses the complex sets of beliefs and affects of modellers and in relation to the situations they can imagine. As employed in these two securitisation schemes, the rationality of the models exceeds the requirements of rigorous scientific experimentation. Its rationality corresponds instead to the realm of beliefs and imagined experience, one which resembles more the role of a myth as analysed by Blumenberg. In his Work on Myth, Blumenberg contributed the idea that ‘[m]yth does not need to answer questions’. It is not its role. Instead, myth ‘makes something up, before the question becomes acute and so that it does not become acute’ (Blumenberg 1988, 197). In this way the role of myths is to suspend questioning. They assume the role of acts of origin which are not to be doubted since they provide the basis for their own existence. Myths ‘make things unquestionable’ (Blumenberg 1988, 126) and put an end to questioning (166). In so doing, they perform an ontological role that provides the basis for complex intellectual arrangements. Blumenberg was concerned with understanding the role of myths in the creation of the modern world. Although his detailed empirical analysis was based on the narrative of ‘wonderful’ stories such as that of Promethean Goethe, his idea of myth helps understand the ontological vacuousness of practices of modelling as a pseudo-scientific basis for the prognostication of futures. A myth signifies the limits of enlightened reason on which scientific analysis is expected to rely. It enables instead a mode of reasoning that operates on the basis of belief and authority and its legitimacy relies on the authority that deploys it as a rhetorical intellectual instrument. It follows that a critical deconstruction of myth would reveal the precarious foundations of systems of thought and action, such as those on which the creation of futures rely and on which the technology of life insurance operates. A critical deconstruction of myth does not involve doubting the existence of the myth itself. The fact that the myth exists reveals that it has been created for a reason, the myth performs itself. When providing the basis for a technology of risk such as life insurance, the question becomes, then, what is the role of the mythical nature of modelling in making insurance possible? The answer relates closely to what began to be developed in Chapter 2 as the transcendental character of life insurance’s epistemological formation. Insurance, to be possible, needs to create its own temporality. It does so by making uncertainty transcend into an imagined future. In the process, insurance operates on a present, it defines it by setting-up the conditions of possibility for action. The future, defined in terms of imagined events, is construed as a horizon of expectation which is ever to come but that enables the possibility for action in a present. The time of insurance, that of a continuous present, is technologically produced through what has been described above as term time.

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In this respect, life insurance acquires a strategic role. The strategy at play is one which combines the production of events with the creation of time and articulates the governance of vitality in a present. The strategy of life insurance is to make life transcend while producing a continuous present. The transcendence of life becomes in this way a technological outcome of governing life through risk. As analysed in this chapter, the production of term time is a permanent and historical process. Life insurers continuously develop new strategies through which events can be imagined and new temporalities developed. Making uncertainty fungible in the form of risk through technologies such as life insurance involves as much creativity and resourcefulness as it does inventiveness. Modelling is but a practice through which this is done and simulations are but an outcome of this practice. Their usefulness is evident for as long as the myths upon which they operate are not doubted. Inasmuch as insurance securitisation strategies such as Vita and Kortis enable the operation of traditional insurance/ reinsurance schemes by instilling liquidity into insurance portfolios, and by providing securities against ‘catastrophic’ events such as pandemics and sustained excess vitality, they become a means for expanding the limits of insurability. There is no doubt about that. In constituting the insurable event through schemes such as Vita and Kortis, insurers reveal the extent to which they manufacture orders of the real upon which markets for protection are developed. In their order of the real (see Chapter 8), insurers generate the temporal frames on which securities such as mortality and vitality bonds operate. Through securitisation strategies they liberate insurability from the temporal strictures of traditional actuarial practices and create an infinite space for market development. Whereas traditional actuarial practices require some form of recorded data reliant on diachronic and chronological imaginaries of time, securitisation has the potential to strategise time in unforeseen forms and dimensions opening up an unconstrained spectrum for the creation of financial securities. This idea moves the debate on the limits of insurability between the limits of calculability of reflexive modernity and the constructivist/hermeneutic understanding of risk as rationality to a different level. By incorporating the possibility of strategically producing the time of the event object of security, modellers, perhaps unknowingly, have demolished the pretensions and limitations of a frequency/impact grid on which risk and risk management had traditionally been presented as scientific. Frequency and impact are categories reliant on the diachronic/synchronic intellectual divide, a division that collapses in the process of performing the time of the event. Term time is not the result of calculations; it is crafted time. Not a science, but an art, the art of enterprising the management of uncertainty.

Note 1 Monte Carlo simulations are based on a computational algorithm which operates repeated random samplings. It is used to simulate systems based on the variables considered by the algorithm.

5

Uberrima fides, trust and contracted life

Uberrima fides is a legal doctrine that governs insurance contracts and expects all parties to the insurance agreement to act in good faith by declaring all material facts relative to a policy. The doctrine originated in England in 1766 with the case Carter v Boehm ruled by Lord Mansfield. Ever since, it has become, with some differences in interpretation, a cornerstone of insurance relationships around the world. The role that trust plays within it, however, is not simple and should not be taken for granted. While it is expected that an idea of trust represents an order of truth, trust in itself is the outcome of a complex negotiation of moral orders. Semiotically, trust operates here not as a Kantian category for the understanding but as a signifier of an order of truth that upholds the possibility for insurance relationships. Trust, as sign, operates as a condition of possibility for the performance of insurance. In this chapter, a Foucauldian approach is employed to problematise the idea of trust and its role in insurance relationships. The case of mis-selling of insurance policies in the United Kingdom since the 1980s, which has given rise to numerous legal rulings, is used as the empirical site for the problematisation.

Suspicion, insurability, and trust It is widely known, as noted by Ericson, Doyle and Barry in 2003, that ‘[u]nderwriters approach insurance applicants with suspicion. They assume all applicants bear moral risks that must be considered in the decision to insure and in the calculus of rating criteria to include in the insurance contract. As a result, all applicants are required to report intimate details that lead to their placement in a category of suspicion that appears insurable’ (Ericson, Doyle, and Barry 2003, 225). However, the idea that only applicants as principals in an insurance relationship would act suspiciously towards their agents has by now been widely refuted. Ericson, Barry and Doyle, for example, made a call in 2000 for a broadening of the idea of moral hazard ‘to include all parties in the relationship, not just the insured’ as a way to examine the hazards involved in the social organisation of private insurance (Ericson, Barry, and Doyle 2000, 532). Following such a call is important because it opens up the possibility of interrogating one of the fundamental elements of an insurance relationship,

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‘trust’, an element that has curiously been left untouched in the social studies of insurance. Trust is traditionally understood as utmost good faith, an understanding that follows the doctrine of uberrima fides, formally brought into common law in England by Lord Mansfield in 1766. Trust is normally assumed as a condition of possibility for insurance transactions, and as noted above, insurers go to a great length to ensure their clients reveal relevant material facts pertaining to the policies they wish to subscribe. However, why would insurers scrutinise their clients and why would regulators invigilate insurance service providers if utmost good faith was a precondition for insurance relationships? The analysis of cases of moral hazard, where principals and agents take advantage of each other by either concealing material facts or by mis-selling products, indicates a different understanding of an idea of trust. Trust in these cases is not a given but an outcome of the insurance relationship. It is actively and continuously produced through the faithful interaction between client and insurer and its effect is a reputation that could be considered as capital for future insurance transactions. However, in every new insurance contract good faith must be proven again and trust becomes a signifier, not of honesty but of an order of truth. The idea of an order of truth refers to an ensemble of power relations which involve, for example, regimes of coercion such as those that result from the implementation of the principle of uberrima fides in law, with what Foucault referred to as ‘technologies of the self ’ such as those that lead to practices of confession (Foucault 2014). A declaration of facts in an application for insurance amounts to an act of individual confession and the elements of power that intervene in making that confession actionable are yet to be explored. On the other hand, the behaviour of agents of insurance (e.g. brokers) and of insurers themselves, conforms not only to market principles of money-making, but also to regulations dictated by state agents and controls by the judiciary. The production of trust in principal-agent relationships must be analysed at the intersections between private and public spheres of governance, and its outcome, as suggested here, should be observed as signifier of orders of truth that are constantly shifting. It must not be forgotten, however, that insurance is a technology of risk that seeks to render the uncertainties surrounding events which constitute the object of a policy insurable. As a technology, it provides a complex set of knowledges, experience, and procedures to present those uncertainties in a manageable form. Insurance offers a form of indemnity against the materialisation of the events insured for, even if the certainty of those events and the likelihood of their materialisation is the subject of speculation. In expecting from insurers an indemnity against insured events, and in expecting from clients the disclosure of any material knowledge relevant to those events, trust becomes a signal of both insurability and the capacity to insure. In its capacity of signal, trust reveals a condition which in this chapter is analysed as the outcome of a complex of power relations.

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The chapter takes as its case study a widely publicised case of moral hazard, the mis-selling of insurance policies in the United Kingdom since the 1980s. It analyses it as a clear challenge to the principle of uberrima fides which has traditionally been interpreted in the UK as an expectation on the principal to reveal relevant facts to the agent. However, in the case in point agents systematically failed to uphold the principle and became the object of accusations and fines by the regulator. The idea of orders of truth is employed to ‘problematise’ trust, as sign, and present the case of mis-selling as a problem of a liberal order of governance. The chapter proceeds in four sections. It begins by introducing uberrima fides as a problem that lies at the core of the very idea of social and political community. It then moves on to present the case of mis-selling of insurance in the UK. The third section is used to explain the idea of trust as a signifier of orders of truth, and the chapter finishes with some conclusions.

The doctrine of uberrima fides and the bonds with social and political community Uberrima fides, or utmost good faith, is generally understood as the legal doctrine supporting insurance contracts. In Heward’s biography of Lord Mansfield who was Chief Justice of England from 1756–1788 and who laid the principles underlying this doctrine, it is claimed that its origins relate to collaboration between church and merchants to develop a principle for mercantile transactions. According to Roman law and Germanic law a man was not bound by a simple promise devoid of legal form. This view was opposed by the church which maintained that a man was bound by his promise and not by the legal forms. The merchants supported the Church in developing the principle of good faith in mercantile transactions. As Lord Justice Bowen said [117 years after the doctrine was formulated] ‘“Credit not distrust, is the basis of commercial dealings; mercantile genius consists principally in knowing whom to trust and with whom to deal’ [Sanders v Maclean 1883] II Q.B. 343. (Heward 1979, 100–101) Enshrining an old moral debate on the order of governance, uberrima fides, as a principle for commerce, entails the belief that the intentions of a counterpart in an insurance transaction are as declared and that there are no issues that could qualify the basis for such a statement. However, this is not a simple assumption. When a transaction is made involving observable goods, for example clothing, the parties at stake have in principle the benefit of inspecting the products as well as the medium of exchange and judge for themselves the validity of the value claims of the other party. When it comes to transactions involving insurance, the situation changes.

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In insurance relations clients approach underwriters with the purpose of buying a promise of reparation should the events for which a policy is subscribed materialise. This involves the complicated process of making explicit what the event for which insurance is sought consists of – known technically as the insurable interest after the 1774 Life Insurance Act in England. Such an event must involve the manifest interest of an individual in the matter of insurance and a temporal dimension known in insurance as the term of cover. Defining the insurable interest is where the definition of the terms of transaction becomes difficult. It entails formulating an event whose likelihood of occurrence is usually calculated through stochastic methods. Probabilities, however, are only a metric which presupposes what is to be measured. That which is to be defined stochastically in terms of probabilities of occurrence is ultimately what constitutes the crux of the matter, a matter which relates to the age-old debate on empiricism and that exceeds the reach of this chapter (see e.g. Deleuze 1991). Uberrima fides is the expectation that both parties to the insurance transaction provide relevant and sufficient information that will help them make an informed decision on the insurability of the event to be covered, in the case of the underwriter, and the usefulness, value, and relevance of the insurance product on offer in the case of the buyer. If it is not possible to expect good faith on the counterparty’s declaration, then the insurable interest would not be constituted and the policy, if such was ever produced, would be rendered void. How to legally ensure good faith in insurance transactions has therefore been a central moral problem for the operation of insurance, particularly from the early eighteenth century onwards, when probabilities were adopted as the mathematics for reckoning uncertainty (see Hacking 1975). In western societies insurance has become a precondition for many forms of credit without which capitalism in its industrial and financial forms would not be possible. It is understandable, then, why such a problem became a prominent legal concern in mid-to-late eighteenth century England at a time when the industrial and financial revolutions were transforming society and influencing the emergence of a new moral order that was to provide the grounds for liberal economic development. In 1766, Lord Mansfield focused the problem of faith in the declarations of the parties involved in an insurance transaction on the legal requirement of the parties to mutually disclose their ‘knowledge’ of issues affecting the insurance. This he did in his ruling of the case Carter v Boehm in 1766 when he stated (for background and explanation of the context of the case, see Watterson 2008): Insurance is a contract of speculation. The special facts, upon which the contingent chance is to be computed, lie most commonly in the knowledge of the insured only: the under-writer trusts to his representation, and proceeds upon confidence that he does not keep back any circumstances in his knowledge, to mislead the under-writer into a belief that the circumstance does not exist and to induce him to estimate the risque, as if it did not exist. The keeping back such circumstance is a fraud, and

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Uberrima fides, trust and contracted life therefore the policy is void. Although the suppression should have happened through mistake, without any fraudulent intention; yet still the under-writer is deceived, and the policy is void; because the risque run is really different from the risque understood and intended to be run, at the time of the agreement. (Mansfield 1766, 1164)

He later added: Good faith forbids either party by concealing what he privately knows, to draw the other into a bargain, from his ignorance of that fact, and his believing the contrary. But either party may be innocently silent as to grounds open to both, to exercise their judgment upon … There are many matters, as to which the insured may be innocently silent – he need not mention what the under-writer knows … [or] what the under-writer ought to know; what he takes upon himself the knowledge of; or what he waves being informed of. The under-writer needs not be told what lessens the risque agreed and understood to be run by the express terms of the policy. He needs not to be told general topics of speculation … The reason of the rule which obliges parties to disclose, is to prevent fraud, and to encourage good faith. It is adapted to such facts as vary the nature of the contract; which one privately knows, and the other is ignorant of, and had no reason to suspect. (Mansfield 1766, 1164–1165 at 1909–1911) Insurance is a transaction that trades in uncertainty under ‘a category of the understanding’ known as risk (Ewald 1991, 199). Risk as theorised by Ewald, is a rationality of governance that renders reality in a particular way amenable to management through specific technologies such as actuarial science (Ewald 1991). Rendering an order of the real in terms of risk already entails a complex set of assumptions about how an uncertain world can be depicted as observable, manageable and governable (Power 2004, 2007). The technology of insurance employed in contemporary insurance contracts is the result of centuries-long discussions and conflicts about how to define that which is to be treated as observable, manageable and governable uncertainty. If such definition is not clearly stated in the contract, the category of risk becomes an empty signifier and the contract becomes a vehicle for making money out of fraud. This not only relates to the old scholastic debates about the nature of usury (e.g. Langholm 1992; Noonan 1957; O’Donovan 2001), of making money without the creation of value – a central moral concern for a Christian economic ethic since the fourth century (Langholm 1992); it is also circumscribed within the modern western moral economic problem of how to safeguard the role of insurance in enabling credit and protecting capital while preserving the speculative nature of insurance contracts (Lobo-Guerrero 2011, Ch. 2).

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When the speculative nature of insurance contracts is abused by any of the parties involved in the agreement by concealing material facts relative to a policy, fraud is committed not only against the counterparty but also against the political community that depends on the operation of these speculative contracts for the creation of value. By keeping in the private realm what affects public trust, fraudsters pose a challenge to what has been referred to as the duty of promise-keeping. This is a well-established idea within modern western social and political theory, as described by Seligman below. From the writings of Puffendorf and Grotius to those of John Locke, David Hume, and Immanuel Kant, the duty of ‘promise-keeping’, of honouring one’s declaration of will (decleratio, or signum voluntatis), becomes a central component of political theory. And, whereas for Grotius the obligation to fulfil promises was an element of natural law, for Kant the ‘perfect duty’ of promise-keeping is what unites us in a moral community, is itself the woof and weave of those ‘bonds of mutual respect between members of a moral community. Promise-keeping then is what allows the constitution of a moral community’, in fact of society tout court. This attitude toward promise-keeping was as true for Locke as for Hume. And if for Locke ‘grants, promises and oaths are bonds that hold the Almight’, for Hume they were but one of the three ‘artifices of society’, necessary for its constitution: no longer divine dictates, but nonetheless ‘a rule-dependent or convention dependent road to commitments beyond family and friends to those whom we bear no “real kindness”’. What, however, is the early modern concern with promise-keeping if not a concern with establishing social bonds of trust in a society increasingly being defined by individual agents with interests and commitments of an increasingly personal nature? (Seligman 1997, 14–15) Uberrima fides, following a nineteenth-century interpretation of Lord Mansfield’s ruling in Carter v Boehm in 1766, has been traditionally employed in the UK to refer to frauds committed by clients against insurers. The case has been somewhat different in other jurisdictions, particularly in the United States, as explained by Hasson (1984) and Achampong (1987). Since the late 1980s, however, there have been prominent cases in the United Kingdom of mis-selling of insurance, cases which relate to violations of the principle of uberrima fides, this time by insurers, which open up the debate about the role of insurance in providing moral bonds between social and political community in western societies. The following section illustrates the case in some detail.

The mis-selling of insurance policies in the UK 27 October 1986 is remembered in the City of London as the ‘Big Bang’ of British financial services. The Big Bang became a central element of Prime

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Minister Margaret Thatcher’s governmental reform that sought to locate the British financial sector at the centre of the world market. Through deregulation, the government hoped to allow for a free market of financial services to provide financial solutions in an age of financial capitalism and drive Britain’s future economic growth. The consequences of this shift were significant not only in financial terms, but also with regards to relations of trust amongst service providers and clients. Philip Augar, a former stockbroker at the City of London, described them in the following terms. In this new world fast finance replaced patient accumulation. Long-term business relationships between banker and client, employer and employee, shareholder and management gave way to brief affairs. The permissive rules made it difficult to maintain any acceptable ethical standards. It was all very well to say the client came first but which client if you are acting for buyer and seller and putting the firm’s capital at risk? Brokers learned that their in-house book not their external clients were the top priority and that the ethical code was for public relations, not for real. (Augar 2001) One of the areas affected by deregulation and which has seen significant erosion in the conceptions of trust upon which it operates has been insurance. With the influx of foreign capital that followed the Big Bang, insurance volume multiplied and many new products were introduced to the market. Figures offered by the Association of British Insurers show, for example, how the total premium volume for ordinary long-term insurance more than tripled between 1983 (£9,980 million pounds sterling) and 1990 (£32,196 million), and almost quadrupled again by the year 2000 (£127,754 million) (as cited by Carter and Falush 2009, 64).1 Much of this growth was driven, amongst other factors, by an aggressive style of sales using young salespeople with little training and experience. A report by the consultancy Oliver Wyman noted that by the summer of 1991: an estimated 172,000 people were selling insurance – one for every 200 working people in England. Most salespeople were hired from college or unemployment and incentivised to sell to family and friends. Working mainly on commission, most would leave once their networks were exhausted, and 80% left within two years of joining a company. (Wyman 2011, 6) One of the consequences of this situation was that many of the sales resulted in under-performing products or generated fees and costs which were not clearly understood by the client or explained by the seller during the sale process. In other cases, customers ended up agreeing to buy products that did not correspond to their personal circumstances or need, in some cases because of mis-representation of the products, in others by simple ignorance.

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The resulting disappointments led to allegations about mis-selling of products and have become, by January 2012, one of the worst insurance scandals in decades. The mis-selling scandal has centred around mortgage-endowment policies (MEP) and Payment Protection Insurance (PPI) and some of the banks that marketed these products have found themselves at the centre of complaints and penalties. According to The Financial Times, during 2011 ‘the UK’s five biggest lenders took charges [by the Financial Services Authority, the British financial industry regulator] totalling almost £6bn for their longstanding practice of providing loan insurance to people who did not need or want protection. PPI was frequently sold alongside loans to cover repayments when borrowers fell ill or lost their jobs’ (Goff and Murphy 2012). An effect of this boom and of the introduction and development of some long-term insurance products such as pensions, endowment mortgages and split capital investment trusts, was a shift from work-place pension schemes to private policies. The shift took place under the understanding that private schemes would benefit the policyholder in the long term and that costs incurred in arranging and managing the policies would in effect represent a saving for the customer. However, according to the Wyman report, which concentrated on the mis-selling of insurance products in Britain since the 1980s, ‘in 1993–4 it emerged that millions of consumers had changed from work-place pension schemes to private policies over the past decade, leaving them worse off’ (Wyman 2011, 6). In terms of endowment mortgages many clients have claimed that they were not made aware of the risks involved in the products they bought. MEPs are a form of mortgage loans where the borrower only pays for the interest of the loan while making payments to the policy. The policy is understood as an investment which is managed by the borrower with the expectation of generating an interest typically higher than the interest paid for the loan. The difference, over time, would in principle pay off the loan and in some cases generate some cash surplus. During the late 1980s the expected returns of these investments were presented as being high, in the order of 7–12 per cent per annum. By the mid- to late 1990s the projections were lowered due to issues such as inflation, changes in interest rates and stock markets, which affected investment returns and MEP holders began to make allegations of mis-selling. They argued that they had not been made aware of the real risks involved in these policies and that the trust they had put in the advisors and financial institutions had been betrayed. Figures of the FSA estimated that by the year 2000 ‘some six million households held around 11 million endowments’ (Wyman 2011, 7), a great proportion of which were not returning the expected percentage. Claims of mis-selling started to become more prominent and by 2002 the Association of British Insurers publicly acknowledged that a slowing down in the rate of growth of MEPs was to be expected. By December that year Lloyd’s ‘was fined by the FSA and ordered to compensate around 44,000 customers for mis-sold endowment mortgages’ to a cost of

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£165 million (Wyman 2011, 7). By the end of 2011 the industry had been forced to pay out £2.7bn in fines and compensation payments to over 430,000 home buyers (Wyman 2011, 7). The case of PPI was slightly different. This form of insurance is offered as a way of covering repayments on debt in case of accident, sickness, unemployment or death which would prevent the borrower from servicing the loan. Typically it is offered in conjunction with credit cards and other loan instruments and it has been argued that the price of the product can be as high as 25 per cent of the cost of the loan (McGovern 2008). Critics of the product have stated that it is normally sold to clients as part of a package building on client’s fears of not being able to repay a loan, even if it is not at all clear if the client really needs the protection and is aware of its real cost. It has also been argued that PPI is usually automatically added to online loan enquiries and that many lenders would add the cost of the policy to the client’s monthly repayments as a way of adding interest to the cost of the policy and therefore augmenting their profit (Which? 2011). Critics have added that commissions and profit shares involved in the sales of these products tend to be higher than the interest charged by financial institutions for their loans. A PPI provider offered figures showing that its borrowers spent close to £4 billion a year on PPI payments of which £2.5 billion were used for commission payments (McGovern 2008). The chief executive of the Citizens Advice Bureau, a charity specialising in citizen advice in the United Kingdom, stated in relation to PPI that, ‘[a]t best the excessive cost for minimal benefits makes it bad value for many people; at worst mis-selling means that the most vulnerable people are parted from large amounts of money under false pretences and left even more exposed to debt. This is particularly worrying at a time when personal debt levels are escalating’ (McGovern 2008). Mis-selling of PPI claims accelerated in the early 2000s (Wyman 2011, 11), although since 1989 codes of the Association of British Insurers (ABI) already included clear guidance on how to prevent these practices. On 1 July 2001 the ABI launched its Mortgage Endowment Code (ABI 2004). That same year the General Insurance Standards Council had also incorporated guidance to this effect in its code of practice. However, only until 2004 did the FSA incorporate regulations on the mis-selling of PPI. Since 2005 five principles have applied to the allegations of mis-selling: ‘A firm must conduct its business with integrity’ (principle 1); ‘A firm must pay due regard to the interests of its customers and treat them fairly’ (principle 6); ‘A firm must pay due regard to the information needs of its clients, and communicate information to them in a way which is clear, fair and not misleading’ (principle 7); ‘A firm must manage conflicts of interest fairly, both between itself and its customers and between a customer and another client’ (principle 8); and most importantly, ‘A firm must take reasonable care to ensure the suitability of its advice and discretionary decisions for any customer who is entitled to rely upon its judgment’ (principle 9) (Financial Ombudsman Service 2008, emphasis added).

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Based on these principles, since 2006 the FSA took action on the misselling of PPI and a turning point in the debate has been a High Court ruling in April 2011 that has ordered banks to comply with the FSA’s regulations. Compensations are estimated to be over £7 billion (Wyman 2011).

Trust as a signifier of orders of truth While discussing his work on subjectivity and truth, Foucault noted that ‘one of the main moral obligations for any subject [in the west] is to know oneself, to tell the truth about oneself, and to constitute oneself as an object of knowledge, both for other people and for oneself ’ (Foucault 1997, 151). This process of knowing oneself, which finds its origin in both pagan philosophy and Christianity (Foucault 2007a, 2007b), results from a dual ensemble of power relations that involve an analysis of the techniques of domination (coercion techniques) and also of what Foucault called technologies of the self, those through which the individual obliges itself to fit within a structure of power (Foucault 2007b, 154–155). Confession, or the act of revealing ‘the truth’, involves coercion techniques in the form of legal precepts such as the doctrine of uberrima fides but also technologies of the self through which individuals impose on themselves the duty to make their private facts public. Trust, in this respect, is the outcome of a combination of technologies of power that result in particular forms of subjectification. The confessing individual, understood through a Foucauldian lens, is a subject of power. The production of ‘truth’ from a corporate body, however, operates a different rationality. In her 1987 article ‘The Social Control of Impersonal Trust’, Susan Shapiro posed the question of ‘how do societies control trust relationships that are not embedded in structures of personal relations?’ (Shapiro 1987, 623). The question remains a relevant one particularly in relation to the case of mis-selling of insurance products analysed in this chapter, but also because of the promise-keeping dimension involved in safeguarding the bonds required for the very idea of social and political community noted before. Arguing against Granovetter, who had claimed fourteen years earlier that social relations and their inherent obligations were the ones responsible for the production of trust in economic life (Granovetter 1973), Shapiro noted that the role of agents, and not only principals, should be taken seriously since they ‘provide access [to trust] by bridging social distance’ (Shapiro 1987, 649). In her words, agents ‘mediate, broker, represent, lobby, “interface”, “network”, and so on’ (649). However, as she noted, such mediated trust does not come without its problems. In complex societies in which agency relationships are indispensable, opportunities for agent abuse [are] sometimes irresistible, and the ability to specify and enforce substantive norms governing the outcomes of agency action nearly impossible, a spiraling evolution of procedural norms, structural constraints, and insurance-like arrangements, each building on

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‘[W]ho guards the guardians? Trust does’, Shapiro stated. ‘The guardians of trust are held to the same standards of disinterestedness, full disclosure, and role competence as those they oversee. And because of the fear that they are no more likely to abide by these norms than are first-order trustees, thirdorder trustees of trustees of trust – systems of social control over social-control agents – respond’ (Shapiro 1987, 649). When a client – as principal – approaches an agent, say for example an insurance broker or a bank, it expects from that agent a trustworthy attitude in the information it provides and the services it offers. It expects from its agent that relevant truth is provided and that private facts that might affect the client’s decision to buy are openly revealed. It does so, among other things, on the understanding that those agents are the objects of regulation by state agencies, which in turn can be held accountable in court. In a market environment, as is the case for the mis-selling of insurance products in the UK analysed here, deceit has been argued to be the rule rather than the exception and clients as well as their defendants have made representations to the regulator, the Financial Services Authority (FSA) which in turn has taken some of those agents to court. However, the expectation that an agent would have the capacity to provide a principal with all relevant information, and that the principal would be in a position to sieve through the data provided in order to make an informed and rational decision about buying an insurance product, would assume the existence of a world with a single order of ‘Truth’, an assumption which Foucauldian scholarship has repeatedly dismissed as invalid. Orders of the real, for Foucault, are constituted through power relations, power relations that ‘involve rational techniques, and the efficiency of those techniques is due to a subtle integration of coercion technologies and self-technologies’ (Foucault 2007b, 155). The agency of such power and its techniques operate through social, cultural, economic, political and religious spheres and as a whole constitute moral orders. Changes in these power relations would lead to changes in the moral orders and to what can be called regimes of truth. For example, when the Thatcher government in the 1980s decided to deregulate the financial markets and introduce new audit institutions and structures as a way to introduce greater market competition within the system,2 the behaviour of agents changed, as evident in the quote by Philip Augar provided in the previous section. The public trust that would result from auditing agents would shift as a result of these politico-administrative changes. Agent behaviour, such as that described in relation to the mis-selling of insurance policies in the UK might not have been possible within a different moral order and regime of truth. Under the system organised around the

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FSA, agents – in this case banks represented by the British Banking Association – believed they could operate in the way they did and when held accountable by the FSA they took the case to court. The 20 April 2011 High Court Judgment that ruled that the FSA’s guidelines on the sale of PPI were valid (High Court 2011), upheld the authority of the FSA and underwrote the public trust that relies on it. As a result clients are now allowed to expect compensation from agents that mis-sold PPI policies to them. The FSA, which in April 2013 split into two separate authorities (the Financial Conduct Authority and the Prudential Regulation Authority), had presented itself as a guardian of public trust through four objectives: ‘maintaining market confidence; promoting public understanding of the financial system; the appropriate degree of protection of consumers; and fighting financial crime’. It publicly states that its aims are ‘to maintain efficient, orderly and clean financial markets and help retail consumers achieve a fair deal’ (FSA 2003). Through its communications, such as the one noted below, it has sought to assure the public that it would strive to produce clear communications that will instil ‘order’ within the financial services industry. Trust and confidence between the regulator and the regulated are essential if the financial services industry is to be successful in meeting consumer needs and expectations. We recognise that perceptions about misselling risks specifically the potential for future retrospective reviews of advice given can undermine industry confidence. By explaining why and how products have been and could be mis-sold, and the approach we will take to any reviews of past business, we aim to remove misperceptions and provide some reassurance. (FSA 2003) What the role of the FSA in the mis-selling of insurance policies in the UK since the 1980s has demonstrated, is that in principal-agent relationships, as analysed by Shapiro, trust is not presumed but performed. Trust in this case operates as a signifier of an order of truth, an order that is as much political as it is economical, social and cultural, and that conjugates Foucault’s regimes of coercion with technologies of the self. If the trust regime built around the role of the FSA changes, as is currently the case with Prime Minister Cameron’s government initiative of replacing it with a new Financial Conduct Authority (FCA), a new order of truth will develop to which clients and agents will have to adapt. New practices and challenges to the principle of uberrima fides will emerge and will, once again, become sites of interrogation of the moral economic character of insurance.

Uberrima fides and the production of economies of trust Freedom in the regime of liberalism is not a given, it is not a ready-made region which needs to be respected, or if it is, it is so only partially, regionally,

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Uberrima fides, trust and contracted life in this or that case, etc. Freedom is something that is constantly produced. Liberalism is not acceptance of freedom; it proposes to manufacture it constantly; to arouse it and produce it, with, of course [the system] of constraints and the problems of cost raised by this production. (Foucault 2008, 65)

Trust is not a given value or a principle for interaction but an outcome of social, cultural, political and economic relationality which needs to be actively and continuously produced. A party might approach another presuming good faith, but good faith must be performed through interaction. The social relations and their inherent obligations, noted by Granovetter, are not a natural phenomenon but one that results from the combination of regimes of coercion with technologies of the self into what is referred to in this chapter as orders of truth. The role of agents in ‘bridging social distance’, as suggested by Shapiro, is not one of mediation, brokerage, representation, interface, or networking. It is instead a performative one where their ‘agency’ performs the relationship which could a posteriori be characterised by trust. The principle of uberrima fides becomes in this respect, not ‘a ready-made region that needs to be respected’, but ‘a proposal to manufacture’ trust through relationships in which the disclosure of material facts is forced upon the counterparty through a complex set of moral technologies. These technologies, of which very little is still known, govern the conduct of individual and collective parties engaged in insurantial transactions. Uberrima fides signals the need to create economies of trust as an outcome of commercial relationality. In the case of mis-selling of insurance products in the UK, a critical moment in the performance of this trust came about with the legal challenge of the British Bankers Association to the dictates of the Financial Services Authority. The ruling of the High Court reinforced the statutory role of the FSA to maintain ‘market confidence’, protect consumers and fight financial crime. In doing so, it highlighted the importance of ‘good faith’ to uphold the possibility of engaging in insurance relationships, relationships on which credit depends to a great extent and on which the very possibility of a capitalist economy relies. The reach of the regulatory role of the FSA, however, is limited and falls short of affecting what in insurance is known as ‘moral hazard’, that is, the incentive of a principal or agent to engage in behaviour that would otherwise be considered too risky if certain conditions or protections were not in place. Trust, observed as a signifier of an order of truth, allows for an understanding of the problem of mis-selling of insurance policies, not only as a problem of moral hazard on the side of the agent, but most importantly, as a problem of a liberal order of governance. As noted by Foucault in the epigraph to this concluding section, liberalism proposes to manufacture freedom, and the manufacture of freedom requires the careful and continuous crafting of good faith. Such crafting lies at the intersection of three interrelated elements, the subjectification of individuals, the creation and maintenance of markets, and the regulatory practices of states.

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Insurance consumers are not mere individuals. They are a very particular kind of subject whose ways of imagining the uncertain have been colonised by imaginaries of fear. Such fear is not natural; it should not be taken as a given. It results from the individual’s continuous exposure to specific problematisations of uncertainty that provide the basis for insurance products. Every time an individual is exposed to insurance advertisements, demand for the product is stimulated. Such demand is not indispensable, although it is presented as such by the insurance provider. Families would not require a plethora of insurance products to be happy, although their happiness is presented by insurers as conditional on the peace of mind that would derive from purchasing their products. After all, the breadwinner would rest assured that the insurer would provide the family with the financial means agreed through the policy to carry on if he or she was to die or fall ill. Based on this promissory capacity to repair financial life if the event objects of the policy materialise, individuals become subject to a technology of protection that demands from them a certain behaviour. As noted in the chapter, clients must reveal the truth of their conditions in relation to the events for which insurance is sought. During the term of the policy clients must behave in particular ways as not to constitute moral hazards that would increase the likelihood of materialisation of the insured event. Clients must as well render themselves subject to scrutiny in case insurers wished to investigate their behaviour and determine their fault in the materialisation of events. In all these ways, clients become insurantial subjects whose behaviour and attitudes are intervened through the process of being insured. Their subjectivity is acted upon from the very moment they apply for a policy and is affected even after a policy’s term has concluded. In any new insurance application the prospective client will be asked if he or she has made an insurance claim in a past given period and if insurance has ever been denied to him or her. This track record becomes a certification of insurability that insurers will take into consideration for new insurance policies in the future. The freedom of the insurantial subject is actively produced through its compliance to the rules and regulations of insurance products and practices. As noted in this chapter, such freedom is not only manufactured through the insurer-client relationship but is also constituted through the markets in which, in the case of this book, life insurance is embedded. Markets for insurers are not driven by demand but are actively constituted through the continuous manufacture of new products. These products are always related to the emerging conditions of liberal life and liberal dwelling. The conditions for livelihoods, for example, are affected by many elements including labour laws, the performance of the general economy and the specific sector in which the individual is active, labour union negotiations, and crisis of sorts. Livelihoods are therefore prone to disruption and instability which fall outside the control of workers and would require some form of protection to compensate for the loss of a job or a change in income. Changes in family households, with the birth of a child or a divorce, for example, will also lead to changes in

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the forms of securities required to maintain a level of financial stability under adverse circumstances. Changes in livelihoods as a result of increased or decreased incomes or improvements or deterioration of working conditions including the terms of the contracts of employment, will also have an effect on the lifestyles sustained by clients. As argued in Chapter 1, all these elements are taken to be part of the lifecycle in which insurers intervene in order to provide products that can address the uncertainties derived from them. In this respect, liberal individuals present insurers with an endless horizon of opportunities for the creation and development of traditional and novel insurantial product lines. As liberal dwellers heavily invested in the maintenance and improvement of their livelihoods and lifestyles, maintaining their insurantial subjectivity becomes of paramount importance. Their behaviour becomes aligned with the morality expected by insurers creating the desired stability in the management of uncertainty. Insurers, from their side, continue to encourage demand for their products through active marketing strategies, which, as noted in this chapter, can lead to problems such as mis-selling of products to those who do not require them or under the false promise of a form of financial reparation which cannot be provided through the policy. The moral economy that results from the insurantial subjectivity of clients and the market entrepreneurship of insurers is one which cannot be characterised by an a priori condition of trust. It represents instead a condition of dependence on the side of clients and one of potential exploitation from the side of insurers. Regulation and law enforcement from governmental authorities to prevent the latter are the third element in the production of trust within the insurance relationship. The role of the state in regulating the ways in which insurers and clients can sell and buy insurance is not only a central one in the case of mis-selling of insurance products in the UK noted above, but indicates a blurring of the traditional public/private divide. Regulation and law enforcement are state functions which are presented as public and although the private sector can affect the way regulators and law enforcers operate there is an expectation that they will remain independent from the private interests of insurers. Insurers, on the other hand, are taken to be private actors which respond to their private interests, those of sustaining a commercial activity with the expectation of generating profit. Insurance clients are taken to be private individuals who, exercising their freedom, decide to purchase insurance products. However, the kind of subjectivity to which individuals are reduced whilst purchasing insurance products, the profit making interest of insurers, and the role of regulators and law enforcers in setting the rules for the operation of markets and upholding them is part of a liberal form of life that could very well be understood as contracted life. Contracted life is one where the dwelling of the liberal individual depends on his or her capacity to engage in contracts of insurance, on the capacity of insurers to deliver the promised form of protection, and the role of regulators and law enforcers to uphold the market rules on which insurance practices and contracts operate. Contracted

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life relates to the moral economy that results from bringing together insurable subjects, insurance markets, and insurance regulators. Its expression comes in the form of the value of trust, which as elaborated on this chapter, is an outcome of the process rather than its condition. Trust, as the expression of the moral economy of insurance transactions, should be understood as related to the ways in which a liberal life transcends. Within the wider context of this book, liberal life is not just immanent to its conditions and moment of occurrence but transcends the very conditions through which it operates. Liberal life operates upon the imagination and formulation of future events which enables the management of a present. What gets governed is a continuous present, whose continuity depends on the capacity of the system to generate contingent futures. The form of transcendence that results from this process is one in which liberal life is never fully secured, it presents itself as continuously exposed to the vicissitudes that result from thinking uncertainty in specific ways. Those ways are greatly determined by the imaginary and market practices of insurers which instil a technological character to the production of liberal security. Understanding trust in relation to insurantial transactions allows us then to put in perspective the ways in which liberal life transcends. The transcendence of liberal life relies on the willingness and the capacity of the insurable subject to abide by the moral economy that results from participating of insurance markets. If the insurable subject resists the morality demanded from it rendering itself uninsurable, its liberal dwelling would be compromised with affecting the transcendence of his/her own liberal existence. If insurantial subjectivity was to be collectively resisted, the mode of transcendence upon which liberal life relies in order to be able to create the value on which its growth depends, would be compromised. If such resistance is sustained, liberal life would not be able to continue to operate causing not only a crisis in the system but its collapse. Implications of this form of resistance would be felt in terms of the liberal political community that has developed over the past three centuries in the liberal, and liberalising world. Contracted life, a life that depends on the ways in which insurers render life as capable of creating value, would cease to be the object of liberal governance. Alternative ways of rendering life would have to be developed and perhaps the market would no longer be the instrument for the creation and management of uncertainties.

Notes 1 Figures include all types of long-term insurance including annuities and pensions. Original source: Life Offices Association. British Insurance Association. 2 For a description of the new regulatory mechanisms that arose from the creation of the Financial Services Authority in 1986, see Power 1997, 32ff.

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Sex, insurance and the valuation of lives

When preparing the reader for his analysis on the logics of ordering and classification in the modern period, Michel Foucault in The Order of Things noted that ‘between the already “encoded” eye and reflexive knowledge there is a middle region which liberates order itself’ (Foucault 2002b, xxii, emphasis added). The way the eye is encoded relates to what is normally taken to be the empirical order, or the order of the real, ‘the fundamental codes of a culture – those governing its language, its schemes of perception, its exchanges, its techniques, its values, the hierarchy of its practices’ (Foucault 2002b, xxii). Reflexive knowledge, in turn, is that which derives from ‘scientific theories or the philosophical interpretations which explain why order exists in general, what universal law it obeys, what principle can account for it, and why this particular order has been established and not some other’ (Foucault 2002b, xxii). The middle region that liberates order itself is the region of the problemspace where the events that are taken as subjects for analysis happen. As events, they are not the result of logical consequences. They are not the result of expectations, which, as put by Veyne, ‘belong to actual experience’ (Veyne 1971, 3–4). They are, instead, as noted by Nancy, surprises that disrupt an order of the real (Nancy 2000), surprises that challenge the knowledge supporting the philosophies that sought to explain order. The middle region is the space for disrupting a phenomenon already identified by Nietzsche when he argued that ‘as soon as any philosophy begins to believe in itself … [i]t always creates the world in its own image; it cannot do otherwise’ (Nietzsche 2000, 206). The middle region is the site of praxis, where the experience of relationality as an effect of the exercise of power materialises. It is the site where the sovereign, as the expression of power, takes place. Assuming the space of the sovereign decision as one liberated from, if influenced by, the strictures of the already encoded eye and reflexive knowledge, opens up the possibility of observing problematisation in the making. Problematisation is here understood in Foucauldian fashion not as moral judgement but as a way of ‘practicing criticism’, of ‘rendering facile gestures difficult’ (Foucault 1988, 154), of showing that reality can always be otherwise. Coming back to Foucault’s introduction to ordering and classifying, ‘in every culture, between the use of what one

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might call the ordering codes and reflections upon order itself, there is the pure experience of order and of its modes of being’ (Foucault 2002, xxiii). This chapter engages with what is presented here as a case of pure experience of ordering. It takes as its site for analysis a 2011 European Court of Justice ruling against the possibility of insurers using sex as a category for discriminating between lives. The development of this ruling will be described in detail in the next section. Suffice to say for the moment that as a sovereign decision, a particular issue that will be touched on in detail later, the effects of the ruling have become the first legal intervention since the passing of the 1774 Gambling Act in Britain on the principles for practising insurance. This Act became a milestone in the governance of insurance, a practice for managing uncertainty that gained prominence since the late seventeenth century. The Act stipulated that for insurance to be licit it had to be clearly distinguished from gambling, a practice that was then taken as a moral vice. To do so a direct interest in the object of insurance should be proven for every policy. Individuals and collectives were henceforth barred from insuring the lives of those on whom they could not prove an explicit interest (see Clark 1999). Apart from the moralising role it performed, the Act had a particular effect in transforming life insurance into an instrument through which the lives of those assured could be transformed into investment capital. The likelihood of individuals being capable of generating projected incomes, a likelihood that resulted from assessing factors such as sex, age, health, lifestyle and profession, could be transformed into collateral for credit which could in turn be used to improve and protect the lifestyle of those assured and their families. It is not excessive to affirm that the 1774 Gambling Act transformed life insurance into one of the single most important instruments for credit in the late modern period, an idea that will not be developed here but that highlights the importance of this technology in understanding historical and contemporary liberal life. Of relevance to this chapter is the idea that the Act set the basis for the practice of valuing lives, a practice in which life insurers engage every time a policy is applied for. The 2011 ECJ ruling analysed below changes the order of classification that the 1774 Act instantiated. It does so in unexpected ways and gives rise to an emerging order for the valuation of lives which will have effects on the forms of credit and protection afforded through insurance. As taking place in the middle region between the already encoded eye and reflexive knowledge, the ruling changes the order of the real under which it emerged and challenges the philosophy that sought to explain insurantial imaginaries. Exploring this region as a new empirical site helps make explicit the politics of valuation of life continuously performed by the life insurance industry in the insured world. In what follows, the chapter proceeds in three parts. It begins with a narrative that introduces the background, the details and the debate that derived from the 2011 ECJ ruling. Although thick in its details, such narrative is important because it sets the case for the subsequent analysis. The chapter then offers some reflections on the politics of valuation at stake in

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the ruling and their implications for the understanding of life insurance. Finally, it concludes with some ideas on what the emerging order of insuring lives tends to look like after the ruling came into force in 2012.

The ECJ ruling and the insurers’ ‘right to underwrite’ On 13 December 2004, the European Council issued a directive aimed at achieving equal treatment of men and women in the access to and supply of goods and services. Directive 2004/113/EC established that in order to implement the principle of equal treatment, the use of actuarial factors related to sex in the provision of insurance and other related financial services had to be regulated. Article 5, which was devoted exclusively to actuarial factors, read: 1

2

Member States shall ensure that in all new contracts concluded after 21 December 2007 at the latest, the use of sex as a factor in the calculation of premiums and benefits for the purposes of insurance and related financial services shall not result in differences in individuals’ premiums and benefits. Notwithstanding paragraph 1, Member states may decide before 21 December 2007 to permit proportionate differences in individuals’ premiums and benefits where the use of sex is a determining factor in the assessment of risk based on relevant and accurate actuarial and statistical data. The Member States concerned shall inform the Commission and ensure that accurate data relevant to the use of sex as a determining actuarial factor are compiled, published and regularly updated. These Member States shall review their decision five years after 21 December 2007, taking into account the Commission report referred to in Article 16, and shall forward the results of this review to the Commission. (European Council 2004, L 373/41)

In light of the derogation of paragraph 2, most Member States informed the Commission of their decision to allow proportionate differences in premiums and benefits where sex was considered to be a determinant factor. In relation to life insurance all states took advantage of this allowance, in the case of private health insurance Belgian law did not allow for the use of gender as a rating factor (European Council 2004, L 373/41). The Belgian case is quite particular since the Belgian Consumer’s Association (Test Achats) challenged the EC on the constitutionality of article 5(2) of the 2004 anti-discrimination directive, a challenge that ultimately led to the 2011 ECJ ruling. The case was brought to the Belgian Cour Constitutionnelle for the annulment of the Law of 21 December 2007 which implemented the derogation provided for in article 5(2). The Cour Constitutionnelle considered ‘that the action before it raise[d] an issue concerning the validity of a provision of an EU directive, [and in consequence took the decision] to stay

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the proceedings and refer the following questions to the [European] Court [of Justice]’ (EU Commission 2012, 6–7): Is Article 5(2) of Council Directive 2004/113/EC of 13 December 2004 implementing the principle of equal treatment between men and women in the access to and supply of goods and services compatible with Article 6(2) of the Treaty on European Union, and more specifically with the principle of equality and non-discrimination guaranteed by that provision? (European Court of Justice 2011, 14) If the answer to the first question is negative, is Article 5(2) of the Directive also incompatible with Article 6(2) of the Treaty on European Union if its application is restricted to life insurance contracts? (European Court of Justice 2011, 14(1)) In its ruling regarding this case the ECJ noted that it did not dispute ‘that the purpose of Directive 2004/113 in the insurance services sector is, as is reflected in Article 5(1) of that directive, the application of unisex rules on premiums and benefits’ (European Court of Justice 2011, 14(2)). It added that Recital 18 of that Directive: expressly states that, in order to guarantee equal treatment between men and women, the use of sex as an actuarial factor must not result in differences in premiums and benefits for insured individuals. Recital 19 to that directive describes the option granted to Member States not to apply the rule of unisex premiums and benefits as an option to permit ‘exemptions’. Accordingly, Directive 2004/113 is based on the premise that, for the purposes of applying the principle of equal treatment for men and women, enshrined in Articles 21 and 23 of the Charter, the respective situations of men and women with regard to insurance premiums and benefits contracted by them are comparable. (European Court of Justice 2011, 30) In its considerations it added that, ‘[a]ccordingly, there is a risk that EU law may permit the derogation for the equal treatment of men and women, provided for in Article 5(2) of Directive 2004/113, to persist indefinitely’ (European Court of Justice 2011, 30). ‘Such a provision, which enables the Member States in question to maintain without temporal limitation an exemption from the rule of unisex premiums and benefits, works against the achievement of the objective of equal treatment between men and women, which is the purpose of Directive 2004/113, and is incompatible with Articles 21 and 23 of the Charter’ (European Court of Justice 2011, 31). ‘That provision must therefore be considered invalid upon the expiry of an appropriate transitional period’ (European Court of Justice 2011, 32). ‘In light of the above, the

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answer to the first question is that Article 5(2) of Directive 2004/113 is invalid with effect from 21 December 2012’ (European Court of Justice 2011, 33). As a way to give member states time to adapt to the new legal circumstances, the ECJ decided to offer a transitional period to enable insurance companies to comply with the ruling and set a deadline of 21 December 2012. Reactions to the ECJ March ruling varied throughout the EU. In the case of Britain, which controls the majority of the insurance industry in Europe, the Financial Secretary stated on 30 June the Government’s disappointment with the judgment and noted that the Government expected the impacts of the ruling to be generally negative affecting mainly consumers. ‘The Government believes that nobody should be treated unfairly because of their gender, but that financial service providers should be allowed to make sensible decisions based on sound analysis of relevant risk factors’ (UK Treasury 2011, 1). Following that line, the UK Treasury published in December 2011 a response to the ECJ ruling in the form of a consultation with the objective to amend the Equality Act of 2010 to implement the judgment. In its analysis it argued that the ruling would, (i) ‘result in cross-subsidisation of premiums between the genders’; (ii) the resulting adverse selection will ‘increase the cost of insurance generally and incentivise riskier behaviour’; and (iii) in the case of motor insurance it is expected that ‘gender-neutral pricing would have consequences for road safety’ (UK Treasury 2011, 1). In relation to the effects of the judgment in terms of adverse selection, the consultation noted: ‘At present, the price of insurance policies is determined by both competition and the information that insurers can gather on the risk that they are covering. These factors help to determine the premium that must be set for different risk categories, in order to fully allow for the likelihood of a claim and the cost of those claims. The more information that an insurer can gather, the more accurately any policy can be priced’ (UK Treasury 2011, 2). In particular relation to gender, the document stated the following: Gender is one of the most important risk indicators that an insurer can use to price a number of business lines. However, if insurers were unable to take gender into account when assessing the risk that they are covering, insurers are likely to have to average prices between high and lowrisk individuals in those lines where gender is a risk factor. In such a scenario, a policy at an average price would be more attractive to higher risk individuals, as the policy would not be priced according to their risk. Conversely, lower risk individuals would find the product unattractive, as they would effectively be overcharged when compared to their fully riskpriced premium. This is likely to result in adverse selection [i.e. bad risks for insurers], whereby the overall risk profile of an insurer’s book becomes more risky as the ‘adverse’ high-risk individuals are incentivised to buy cover and low-risk individuals depart the market. (UK Treasury 2011, 14)

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The consultation went further to highlight the impact of the ECJ ruling on the British insurance industry. It argued that the low-risk category of consumers, ‘who stand to lose the most from this change, may in some cases leave the market or take a lower level of cover, which will affect revenues taken by insurers […]’. Second, ‘[a]s industry implements the change, it is likely to incur additional costs. This will include (but is not limited to): changes to underwriting practices; marketing changes; changes to sales approaches’ (UK Treasury 2011, 14). The ruling was the object of other expert commentaries. The following one from a British insurance company is worth quoting at length since it alerts us to the problem of valuation that results from underwriting practices. The ECJ ruling has immediate negative implications for insurers and their customers. Is there anything positive to be found in it? Well maybe. Perhaps it represents a prompt to think about the future basis of risk selection in life and disability insurance. There is an undeniable tension between understanding of risk and large-scale risk pooling. Given what we know about risk and risk factors – and what consumers know about themselves and their own risk – the pricing of risk on age, gender and smoking status, with a look back at medical history, is arguably a bit crude. Don’t we owe it to consumers to tailor premiums to individual risk as much as we can? On the other hand recognition of differential risk factors and more detailed risk selection and pricing – while reinforcing the principle of equity – inevitably benefits a proportion of policyholders while penalising others by higher premiums or reduced benefits. In the case of annuities, the UK market for which is seeing a sharply increasing trend towards more detailed underwriting, the healthy will be worse off in retirement income. Fair enough. Or is it? Is there a case here for maintaining strong pooling to avoid increasing the vulnerability of a sub-group of the old-age population? (SelectX 2011, 2, emphasis added) Other commentaries pointed out the democratic deficit involved in the new prohibition. This was the case of Stephen Booth, director of research for Open Europe, a European think-tank. This ruling has pushed anti-discrimination legislation beyond the realms of all common sense. Unaccountable EU judges have ruled to overturn long-held national rules and increased costs for consumers in the process. To do so in the name of equality just adds insult to injury. This goes to show that EU judges are able to rewrite national laws but with no democratic controls in place to ensure that their rulings make sense and are proportionate. Clearly, it’s time to put some checks on these judges, and the UK government needs to take a far stronger position in

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Sex, insurance and the valuation of lives pushing for reforms. Otherwise, it’s only a matter of time before we see another EU ruling which has a negative impact on individual citizens or the UK economy as a whole. (SelectX 2011, 2)

The reinsurance sector, which produces the underwriting manuals that insurance companies are to use if they are to be covered by their policies, also made public its reaction to the ruling. On 6 June 2011 Swiss Re published a report entitled Fair risk assessment in life & health insurance. It was published as an update of a previous report of 2007 entitled Life risk selection at a fair price: reinforcing the actuarial basis. It argued that the gender discrimination judgment is only one part of a three-decade-long continuing debate on regulation of insurers around issues of discrimination, privacy and entitlement. Drawing on the cases of HIV AIDS and disability, among others, the report made a claim that regulation through legislation on the insurance industry restricts the industry’s right to discriminate, actuarially, on the levels of risks that clients bring to their insurantial pools. Claiming a right to underwrite, Swiss Re argued that the industry has a long-established tradition of risk selection practices which is based on Evidence Based Rating (EBR) which relies heavily on Evidence Based Medicine (EBM). Excerpts of the document are quoted below to present the logic of the argument. Governments and regulators are exerting increasing influence on the risk selection process of the private life and health insurance industry … it follows three decades of regulatory developments and pressure on the industry to prove that its risk selection process is fair, and that the price charged to the consumer of insurance products is actuarially sound. Private insurance contracts are based fundamentally on the commercial freedom to price and underwrite according to the risk presented. This offers the fairest way to provide coverage for the maximum number of people at an affordable cost. Impairments that impact the commercial freedom to price and underwrite and could result in higher prices for large sections of the insurance-buying public. This may lead, ultimately, to lower availability, affordability and choice of private insurance for society as a whole. Unless industry exemptions are in place, anti-discrimination legislation can present a concern for insurers, because it denies underwriters the ability to differentiate between people on the basis of a fair risk assessment. In such circumstances, the law effectively forces insurers to crosssubsidise between groups of policyholders – and once again, this can lead to price increases and, ultimately, to a reduction in the availability of insurance cover. (Nabholz and Somerville 2011, 2) Swiss Re presents the debate in terms of the insurer’s ‘ability to underwrite’. In their words:

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Swiss Re, whilst opposing unfair discrimination, supports the use of objective, relevant and reliable data for insurance rating purposes. The actuarial and data-driven basis behind differentiated prices offered to consumers ensures fairness and competitive prices. Insurance is a means of pooling risk so that the financial impact of any insured event, which could be significant or disastrous for the person or company holding the insurance cover, is spread across a wider insured population. (Nabholz and Somerville 2011, 2) In light of this debate and as a general response to queries raised, the European Commission published on 13 January 2012 its ‘Guidelines on the application of Council Directive 2004/113/EC to insurance’. It was noted there that the unisex rule shall only apply to new contracts concluded after the deadline for transposition of the directive on 21 December 2007 which means that for contracts signed after 21 December 2012 the rule would apply in full. It clarified that the ruling ‘does not prohibit the use of gender as a risk-rating factor in general. Such use is allowed in the calculation of premiums and benefits at the aggregate level, as long as it does not lead to differentiation at individual level.’ Insurers ‘remain able to collect and use gender status for internal risk assessment, notably to calculate technical provisions in line with insurance solvency rules and to monitor their portfolio mix from an aggregate pricing perspective’. Insurers and reinsurers are allowed to use gender in pricing their products ‘as long as they do not lead to gender differentiation at individual level’ (EU Commission 2012, 14). The Guidelines added, ‘[i]t therefore remains possible for insurers to use marketing and advertising to influence their portfolio mix, e.g. by targeting advertising at either men or women’ (EU Commission 2012, 14).

Reflections on the politics of valuing lives Three issues become evident in the analysis of the politics of valuing lives in the case narrated above. The first is the need for the insurance industry to have gender stability for its order of classification of lives to be possible. This issue highlights a shift in importance between sex and gender, the former term figuring prominently in the EC Directive and the ECJ ruling, the latter being centrepiece in the insurer’s discourse. The second is the insurance industry’s assumption that their products are indispensable instruments for liberal life. Thirdly, the insurer’s claim for their ‘right to underwrite’ based on ‘evidence-based-underwriting’ practices. Sex is not a simple category for the classification of lives as it might at first glance appear. In the spirit of the EC Gender Directive, the discrimination that is sought to be prevented is between ‘men’ and ‘women’, and although the term ‘gender’ is used interchangeably with that of ‘sex’, it is clear from the text that there is a binary understanding to this distinction. It is important at this stage to provide the context of governance under which the EC

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directive came into place. To do so I will rely on the work of Repo on gender equality as biopolitical governmentality in a neoliberal European Union (Repo 2015). The Gender Directive must be understood as part of a wider governmental challenge in the European Union of how best to reproduce labour and life within a context of neoliberal governance. Gender in this context, must not be taken, following Foucault, ‘as self-evident, but rather studied as a “technology of power” that invests bodies with power, not solely for purposes of control, but to render them forces of production’ (Foucault 1991, 23, as cited by Repo 2014). Neoliberal governmentality is a rationality that subsumes social, political and economic behaviour to the principle of the maximisation of utility, an economic calculus that expects individuals and entities to be governed by interests which must be satisfied. Under this rationality markets play the role of rector entities through which goods, ideas and services can be produced, consumed and allocated. At the same time, markets dictate the values through which everyday life is governed. In the EU’s scheme of neoliberal governance the family plays a central role. Families are expected to proactively engage with their own sustenance and capacity to endure under adverse circumstances. As noted by Rose, families ‘become tasked with the responsibility to govern themselves in ways that will maximise the human capital of their members by cultivating them as active, calculating, consuming, and enterprising subjects’ (Rose 1998, 163 as cited by Repo 2014). Human capital, developed originally as a proposition from the Chicago School, where, for example, Gary Becker argued that the human should be seen as a productive entity on which investments are made and returns are expected (Becker 2009), has become the cornerstone for neoliberal governance in the EU. The cost of education and the opportunity cost incurred in child bearing and rearing, for example, are considerations that matter for endowing an individual as a productive element in an economy. Under this perspective the value of the human as a current and potential productive being can be measured and developed. The human becomes a resource that can be planned, it becomes an object of intervention and management that if adequately fostered could maximise its capacity to develop and endow other beings with the potential to do so. The role of the family within this context is to support the mutual development of its members into active economic actors, a role that demands a continuous engagement with education and life-long continuous training, medical services designed to support the continuous expansion of the economic capacity and productivity of individuals, and the maximisation of the reproductive capacity of its members without compromising their economic role in society. The idea of social capital is not one that emerges in the 1990s, although this is a period in which explicit reference to the idea is made in neoliberal governmental policies. Foucault had already referred to this concept in his lectures on The Birth of Biopolitics in 1978–1979 where he examined the precursors of neoliberal discourses and policies in post-World War II

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Germany and the United States. There, he understood human capital as encompassing investment, capital costs and profit, both in economic and psychological dimensions which affected the behaviour of individuals and collectives (Foucault 2008, 244). Human capital was a way to subjectify the liberal individual under a logic of capital accumulation. Such a logic required an understanding of markets as the sources of truth for individuals, societies and governments. Markets were presented by him as ‘sites of veridiction’ where prices would become the markers of the state of economic reality that would provide the basis for awareness for decision making. Individuals’ freedom came to be understood as the capacity of individuals to exercise choice within competitive markets. While markets would become increasingly open to competition, the role of states would be to set and verify that liberal economic principles as the basis for economic competition were observed. The state assumed a role of regulator rather than one of provider of services and the political role of individuals became blurred with that of consumers and producers. The maximisation of their interest became paramount in defining the political role of the state. This is the context in which during the early 1990s, with the entry into force of the Maastricht Treaty, the EU consolidated an economic consensus that took up the task of developing an economic policy that would foster the economic capacity of the Union. The consensus was based on the principles of neoliberalism and the creation of a common market, with a common currency and the institutions that would ensure its political operation. The European Commission, as the executive body of the Union, was faced with the challenge of harmonising different levels of welfarism within the countries of the Union with the need to dynamise the economy in the context of a growing liberalisation of the global economy. Welfarism had been the result of decadelong policies in member countries developed to compensate for the externalities of market-led economies. Issues such as unemployment, ill-health and disability, childhood and old age, were addressed by states, through different kind of policies and levels of involvement, as a way to ensure social and political order. Within the new global economic context that resulted from the end of the bipolar confrontation of the Cold War and German unification, the EU engaged with the challenge by pushing forward neoliberal reforms. A central aspect of these was an intervention at the level of the family to encourage the economic activity of women as productive elements in society. Issues such as birth rates and childcare, however, had to be addressed. It is in this context that Repo has argued in a very convincing way that gender acquired a new role in the neoliberal governmentality of the EU. According to her, such governmentality has developed a policy of gender equality as a way of deploying gender as an instrument for governance. Her argument has been that ‘during the course of the 1990s and 2000s, the EU took up gender as a biopolitical technology of power for the control of human reproductive and economic behaviour in line with the new neoliberal political and economic consensus that emphasised economic freedom,

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personal enterprise, freedom of choice, and self-realisation’ (Repo 2014, 4). Based on an analysis of key gender equality and demographic policy documents since 1993, especially Green and White papers, she examined ‘how rationalities of power embedded in these documents mould gender equality into a biopolitical mechanism for optimising below-replacement level fertility rates whilst simultaneously promoting the industriousness of the adult population by modifying women’s reproductive and productive behaviour’ (Repo 2014, 4–5). Her argument is quite nuanced and worth examining in detail for the depth that it provides for understanding the changing character of gender as a category for neoliberal governance. In her analysis she notes how the objectives of the 2006 Gender Directive expect women to replace the retiring male workforce and become ‘the next generation of wage earners’. Gender equality is a vehicle through which this is expected to happen, not by equating males and females in their roles and capacities, but by ensuring a system of compensation for the roles of childbearing and childcare in which women have traditionally been engaged and by allowing for the incorporation of males in these roles. As she puts it: the EU’s use of the gender term is not merely a correct synonym for sex. In its policy texts, gender is articulated as something produced through the socialisation of (sexed) individuals into gender roles. In drawing on the idea of sex/gender, therefore, sex is understood as functional matter, in other words, the biological facts and bodily capacities that make sexual reproduction possible. Rather than trying to control sex directly, the EU aims to tap into gender, the socially produced sexed behaviours and desires that determine how individuals make use of their sex. EU gender equality policy formulates gender as an invisible hand that guides individual decision-making processes. Restrictive gender roles can obstruct the availability of life options for the interest-driven human and therefore an affront to the freedom of choice from which society as a whole may suffer. The objective of gender equality policy is therefore not to remove gender roles, but to allow individuals to make allegedly better, more rational choices for the benefit of the species and the economy. (Repo 2014, 175) In this context, the role of the invisible hand as depicted by Repo becomes one of the most important objects of protection through European policy. The Gender Directive aimed to do that, to ensure a market in which individuals would not be discriminated on the grounds of sex. The exception made in its original formulation, however, as a result of the lobbying action of the financial industry, protected insurers from its reach. The correction made after the ECJ ruling banned the use of sex as an underwriting category. What is interesting here, however, is not that the ECJ and the EC scored a victory over the insurance industry but that it forced the industry to adapt to changes in the sexual order of neoliberal societies.

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As notable cases of inter-sexuality have made clear in the recent past, the traditional binary logic of sexual classification is being successfully challenged in the EU, putting the stability of genders that resulted from strategies developed in the post-World War II period in crisis. Quantifying the size of the intersexual population depends greatly on how an intersexual individual is defined. Conservative approaches locate the figure between 0.2 and 0.7 per cent of total births. Other figures go as high at 1.7 per cent. If a figure of 1 per cent is to be considered, based on population figures for the EU offered by Eurostat (507.4 million as of 2014) (EUROSTAT 2014), around five million intersexual individuals will be living in the EU. Such a figure is not negligible and is being addressed in EU policy documents mainly from the angle of gender equality as a 2012 document issued by the European Commission on issues of discrimination on the grounds of sex states: European societies are based on norms derived from the simplistic idea of a dichotomy of two mutually exclusive and biologically defined sexes to whom different roles and behaviour are traditionally ascribed (the binary gender model). People who do not easily fit these norms, such as trans and intersex people, encounter numerous difficulties, both at the practical level of everyday life and at the legal level. Obviously, this is not acceptable in a legal union such as the European Union whose founding Treaty, according to Art. 2 TEU, is founded on respect for human dignity and human rights, including the rights of persons belonging to minorities. (European Commission 2012, 9) The ‘traditional gender model’ to which the document refers is and has not been as stable as it might appear. The category of gender, in use since the mid-twentieth century as will be detailed below, is but one of the difficulties insurers have had in the underwriting of life in the past three centuries. As the following quotation shows, the idea of a woman as an insurable subject has been prevalent ever since probabilistic life insurance underwriting began in the second half of the eighteenth century. Women were a puzzle to life insurance companies for a century and more before 1900. First of all companies to write life insurance on a systematic basis was Equitable of England, 1762. They accepted women, but required extra premium. Then came general population studies of mortality in France, Sweden and Switzerland that showed women to be living longer than men. English companies dropped their surcharge until a joint survey of 17 British offices in 1843 gave the surprising information that female insureds had a higher death rate than males. Back went the extra premium. Came then American studies at the beginning of this century topped by the huge Medico-Actuarial Investigation on 400,000 female policyholders insured between 1885 and 1908. There were 15,500 deaths. In the first year of coverage, mortality ratio was 113 per cent of expected,

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Sex, insurance and the valuation of lives 108 in second year, 105 in third-fourth-fifth years, 99 per cent thereafter. But, spinsters had an 81 per cent ratio, widows and divorcees 105 per cent, married women 119 per cent. Married women whose husbands were beneficiaries had a mortality ratio obviously a factor. When unmarried women bought for themselves, endowments especially, they lived to collect. When married women had insurance bought on them for others to collect, others did just that – they collected. H. DINGMAN, RISK APPRAISAL 171 (1957) See also J. MACLEAN, LIFE INSURANCE 108 (9th ed. 1962). (Bayatrizi 2008, 123)

Distinguishing between the ways in which insurers use the terms ‘sex’ or ‘gender’ is of great relevance. What a male or female is should be understood in direct relationship to the ways of life on which insurers have historically operated. Through the work of Foucault, who developed a comprehensive genealogy on sexuality, it is known that ideas of sex are never natural and always relate to the ways in which a human species is understood. To say that such definitions are political amounts to saying that they are the result of expressions of power. Categorising a species in terms of sex is an engagement with the possibilities available to a species to reproduce. The terms of reproduction, the conditions under which reproduction can take place, and the nourishment of the offspring are never neutral or innocent practices, Foucault taught. They are deeply implicated with the ways in which life, morality, order, and governance are understood at any given time and place (Foucault 1988, 1990, 1998). If the history of insurance shows that ‘women’ have been an underwriting puzzle for centuries it is because what is taken to be a woman is not simply the result of biological features or cultural determinations, but more importantly, a changing subject. The insurable woman of eighteenth century Britain was construed in very specific ways and her expected behaviour will be the result of a complex ensemble of social, cultural, economic and political contexts. The woman of the Victorian period in Britain would be a radically different subject which would respond closely to the understandings of sexuality of the time. The neoliberal insurable woman, or for this sake, man, of the twenty-first century is not simply a sexed individual but a complexly gendered one. Sex and gender, although usually taken to be interchangeable concepts within contemporary insurance documents, are, ever since the mid-1950s, not synonymous. Whereas Foucault demonstrated how sex is not a pre-existing category for the classification of life, not a neutral biological feature which cannot be challenged, but an object of enquiry into how bodies are disciplined as part of wider strategies for the regulation of populations, recent work has demonstrated that gender is not simply the cultural dimension of sex. Repo has provided a genealogy of the idea of gender that shows how the concept originates from practices of intersexual case management in the 1950s in the United States (Repo 2013, 229). Concerned with the problem that hermaphrodites posed in terms of sex assignment, Repo describes how John Money, a professor of medical psychology and paediatrics at Johns Hopkins University, published together

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with some colleagues a series of articles ‘introducing a radical idea that a person’s psychological sex was learned and did not necessarily arise from biological factors’ (Repo 2013, 228). Such a radical idea, which framed the concept of gender, opened up the possibility of intervening in the ways in which an individual’s identity as man or woman was to be developed. The idea, however, emerged out of a wider problematisation of social order in the post-World War II environment. The role of women in western societies experienced significant transformation as a result of the strictures and the economic and political demands of the two world wars. In the post-war environment social order had to be upheld as a matter of urgency. As put by Repo, the creation of gender in the post-World War II period was the response to the urgency of upholding social order (Repo 2013, 230). As a result, gender emerged as a new category for governing sexual identity, but overall, for stabilising it. Repo introduces the idea of gender as a new apparatus that relied on recent developments in the social sciences of the time, behaviourism and functionalism. Behaviourism argued that much of human behaviour was learned; functionalism proposed that society was a system supported by structures and institutions such as the family, education, law, religion, and the professions (Repo 2013, 230). Under such conditions it became reasonable to assume that individual behaviour could be conditioned through what was noted in the studies of the time as ‘neutral stimuli’. Behaviour, in other words, could be stimulated and stimulation became a site for the intervention in how life was to be classified. The institutions that supported society could be intervened in such a way that the identity construed on individuals could be supported and protected. The case of hermaphrodites, or sexually undetermined bodies, presented an opportunity for such intervention and governmentalisation of life. If behaviour could be conditioned, individuals to whom a sex had to be assigned could be educated into their new identity and the institutions on which they relied, for example the family, could be intervened to accompany the process of sexual assignment. The process began with a surgical intervention to cut and adapt the genitals of the patient. Subsequent physiological and psychological treatments were required throughout the life-cycle of the individual to ensure the identity could be maintained. This made it necessary not only to render the newly sexed individuals docile, as subjects of physiological and psychological intervention, it also required an intervention in the institutions required to sustain the process. In this respect parents, relatives, close friends, medical practitioners and teachers had to be trained. In so doing, physicians had found in gender an apparatus with which to strategically interfere in ‘the contingent cognitive processes of the behavioural control system of the mind’. They had at their disposal ‘explanations for the misalignment of psychological sex and physiological sex’ which justified physical interventions into the bodies of their patients. ‘[G]ender provided [them] with a framework with which to diagnose potential cognitive and structural sexual threats to the management of the life of the species’. ‘[G]ender emerged specifically as a new apparatus for the regulation of the life of the species’ (Repo 2013: 240).

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If gender emerged as an apparatus for the intervention in the species by creating sexual identities, the stabilisation of the resulting order required continuous action. One of the features of such operation is what Butler has referred to as repetition and iteration as mechanisms through which the subjectivity of genders is performed. Gendering becomes a result of power relations engaged in stabilising sexual distinctions as the basis on which to create orders of identity. Performativity cannot be understood outside of a process of iterability, a regularized and constrained repetition of norms. And this repetition is not performed by a subject; this repetition is what enables a subject and constitutes the temporal condition for the subject. This iterability implies that ‘performance’ is not a singular ‘act’ or event, but a ritualized production, a ritual reiterated under and through constraint, under and through the force of prohibition and taboo, with the threat of ostracism and even death controlling and compelling the shape of the production, but not, I will insist, determining it fully in advance. (Butler 1993, 95) The performativity of gendered subjectivity comes along with the instantiation of an order represented as ‘stable’. Being able to systematically distinguish between men and women and to align that distinction with clearly determined features that can be statistically validated as determinants for levels of risk is a necessary condition for modern probabilistic insurance underwriting. Since the 1774 Gambling Act it has been taken for granted that such stability is implicit in the order of classification. The EC directive and the ECJ ruling reinstate such stability and use the binary distinction to protect a principle of equality as the basis for non-discrimination. The second issue relates to the implicit assumption in the insurance industry’s discourse that their products and services are necessary to support the forms of life that operate within the liberal market economies of the European Union, and beyond. Although insurers are clear in distinguishing between the principles that support public forms of insurance from private provision, the following quotation, as part of a narrative that seeks to ‘naturalise’ the need for private insurance presents the latter as a complement of the former. In many markets, particularly in Continental Europe, a distinction must be made between private insurance and social insurance benefits that governments choose to provide for their citizens. The level of social insurance-type protection considered appropriate by government varies widely from country to country, and so therefore does the level of private insurance needed to complement it. The point at which social – or compulsory – cover needs to be supplemented with additional provision is the starting point for the development of the private insurance market. (Nabholz and Somerville 2011, 2)

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Within the context of this argument, any attempt to regulate or restrict the insurers’ ‘right’ to underwrite, the third issue to be opened up to political contestation as a practice for classifying life, is an attack on the form of liberal protection provided through private insurance. Insurers are quick to highlight the idea that their practices are supported by understanding risk as probabilistic, probabilities that arise out of evidence-based knowledge, knowledge that allows them to absorb risk by means of creating and operating risk pools. In the words of Swiss Re, [p]ooling is the practice of grouping similar risks and charging the same – or standard – premium rate for each person in the pool. Each person in the pool is assumed to exhibit a broadly similar risk profile. A simple example would be a pool of private life insurance customers of a certain age or age band. A second pool would be created for people of another age or age band – and so on. Once a contract has been entered into, equal risks are placed into the respective pool and managed collectively. (Nabholz and Somerville 2011, 3)

The pooling concept and the assumption of risks with similar profiles are fundamental to insurance companies’ pricing process. Based on the risk characteristics of each specific pool, the insurer’s pricing actuary will assess the premium rates appropriate to cover the collective risk, using a degree of averaging within each pool. Ensuring that the risks in the pool remain close to this average is crucial in making sure that pricing is fairly applied both within and between different risk pools. The insurer would also want to accommodate as many people as possible in each pool: the larger the pool, the less variation in the collective risk. (Nabholz and Somerville 2011, 4) What is important here in relation to the previous point on the need to have stability of genders in order to operate an order of insurance is that pooling can only be possible as a practice of discrimination. The ECJ and the EC have been clear in stating that although insurers can consider categories such as sex for their internal processes, they are not allowed to price risks based on gender discrimination. Insurers are open about their discriminatory practices as embedded and justified within their own actuarial logic of classification. Their discourse is articulated around a narrative of ‘evidence-based rating’ and ‘evidence-based medicine’, as the following quotations illustrate. Actuaries set the basic price that an individual applicant pays by modelling claims experience data and by identifying mortality trends with respect to age, gender (where allowed) and often smoker status. Applicants who present a history of poor health, perhaps a previous heart attack, or an abnormal risk factor such as high blood pressure, or who undertake a high-risk

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Sex, insurance and the valuation of lives occupation or leisure activities, may bring to the pool a level of risk that is substantially higher than that of the standard risk group. In such situations the risk is regarded as substandard in insurance terms and an additional risk premium, proportionate to the level of risk, may need to be paid. Those extra charges are called ratings. At an extreme, the risk can be so high that it is regarded as uninsurable (in which case the application is typically declined or postponed). The decision whether an applicant is standard, substandard, or uninsurable is made by an underwriter using risk selection guidelines set out in a life and health underwriting manual. In recent years, re/insurers have come under increasing pressure to defend decisions to rate or decline an applicant, and to justify the ratings recommended in their underwriting manuals. Reinsurers’ manuals play an important part in risk selection and therefore are subject to ever-closer scrutiny … Without a formalised approach to data collection and standardised analytical methods, the ratings applied by re/insurers could be questioned as to their fairness, accuracy and validity. (Nabholz and Somerville 2011, 6) In response, reinsurers such as Swiss Re continuously and critically evaluate their prevailing risk ratings to produce up-to-date, evidence-based rating (EBR) guidelines that, coupled with skills and knowledge, an underwriter can use with confidence in assessing whether to apply a rating. The provision of an underwriting manual is considered by direct insurers to be a key part of a reinsurer’s value proposition, to the extent that the quality and depth of the manual can influence the choice of reinsurer. The guidelines are produced using data from clinical and insurance literature, as well as the findings of experience studies analysis. The result is a risk classification process that is carried out fairly, with regards to all interested parties – including the applicant and those who are already members of the risk pool. (Nabholz and Somerville 2011, 7)

There is, however, a curious interaction between evidence-based rating and evidence-based medicine. Life and health underwriting requires … the conscientious, explicit and judicious use of current best evidence in making decisions about morbidity and mortality risk. The practice of evidence-based rating (EBR) means integrating underwriting expertise with the best available clinical and insured-lives evidence from systematic research. (Nabholz and Somerville 2011, 23) The logic of their evidence-based underwriting is not without internal challenges. Translating data into ratings is problematic and therein lies their difficulty in articulating the discourse.

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One of the challenges involved in translating data into ratings relates to risks that exist as continuous variables – blood pressure or cholesterol, for example. For impairments such as stroke or breast cancer, in determining whether the risk is substandard or within the range of the standard risk group, the mortality rates of those in the standard risk pool are compared against those presenting the impairment – a relatively uncomplicated process for experienced practitioners assuming credible data is available. (Nabholz and Somerville 2011, 23) The industry has presented the case of Body Mass Index as an important contribution to evidence-based medicine, a case that illustrates how the ‘already encoded eye’ feeds into ‘reflexive knowledge’. The middle region, however, opens up this space for problematisation. Interest in build as mortality risk factor for insurance dates back to 1903. Subsequent analyses of insured lives datasets have shown that, the greater the departure from average weight (depending on height), the higher the mortality. Particularly noteworthy is the 1979 build study which included more than 4.5 million insureds who were followed up for up to 22 years. Subsequently to the 1979 study, height and weight tables – which have been used by underwriters to assess risk – have been replaced in the clinical literature by body mass index (BMI) as a single index of build. BMI is measured by dividing the weight in kilograms by the height in meters squared. The index is not without its critics, because as a measure of intra-abdominal fat (which is the most important factor in the cardiovascular and cancer mortality risk associated with obesity) it is somewhat crude. It is feasible that BMI may eventually be replaced by waist circumference or the waist-to-hip ratio but currently BMI remains the most widely used measure of build in clinical practice. The majority of clinical studies using BMI have shown that, for obese individuals, the all-cause mortality risk increases in line with BMI. The most important study is the American Cancer Study. This shows that, compared with a normal build (BMI between 22 and 24), increasing BMI is associated with an increased mortality risk. (Nabholz and Somerville 2011, 24) As Deleuze noted in his reading of Hume, ‘the determination is not determining; it is rather determined’ (Deleuze 2001, 26). Understanding how insurers determine their ‘right to underwrite’ allows for an interrogation of the assumptions upon which their underwriting practice operates. As shown, if briefly, in this section, assuming the stability of genders, the necessity of their products to support a liberal life, and the validity of their claims with regards to the evidence-base of their underwriting practice, begins to prepare the ‘middle region’ as the ground from which to contest the empirical order, the sets of beliefs and practices upon which the life insurance industry

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operates. This matters to a very great extent because the logic of classifying life that insurers operate has consequences on how such life is ‘valued’ and considered as ‘value’, as the following section discusses.

An emerging order in the valuation of life Practices of classification are never politically neutral. They are themselves exercises of power. They constitute sites where decisions on what is to be considered worthy of classification and the logics under which this is to be done are taken. Once these practices become technological, as is the case with modern insurance, these logics become implicit and are usually not subjected to scrutiny. When practices of classification become part of the ‘already encoded eye’ and justified through ‘reflexive knowledge’ they become shielded from the uncritical observer. When these practices are interrogated as part of the ‘middle region’, it becomes possible to analyse how the political responsibility that derives from them materialises in orders which are never innocent, and are always contestable. Practices of classification are already practices of valuation. The practices through which insurers classify life are intended as ways of valuing the lives object of protection. Life insurance policies are bought for a reason, be it to protect a lifestyle or a livelihood during the duration of the insured’s life, to collateralise a debt based on the expected cash revenue to be derived from the livelihood of the person insured, or to protect the lifestyle or livelihood of family members once the insured life has ceased to exist. In all cases insurance underwriting, evidence-based or not, is intended as a way to ascribe value to life. Valuation is in turn a highly loaded practice embedded within very specific imaginaries. Gilles Deleuze noted that ‘it is values that presuppose evaluations, “perspectives of appraisal”, from which their own value is derived … Evaluation is defined as the differential element of corresponding values, an element which is both critical and creative … Evaluations … are not values but ways of being, modes of existence of those who judge and evaluate, serving as principles for the values on the basis of which they judge’ (Deleuze 1986, 1). It follows, then, that focusing on practices of valuation allows for an interrogation of ways of being, of the modes of existence that value and that seek to ascribe value to things. But value in itself is a curious category of thought. Thinking value entails already the acceptance of the price-ability of things, and from where does such price-ability emerge? Especially, when, as noted by Nancy, ‘[t]here is a “without price”’ (Nancy 1997, 128). But what can the ‘without price’ be? One replies: the person, man, woman, life and so on. The problem is that in thus replying one thinks that one knows what the person, man, life, etc. is. One would perhaps have difficulty defining them clearly, if one had to do it: and rightly. Moralising exhortations about values do not do this. Such exhortations

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rest, instead, on a tacit and unquestioned consensus according to which one knows very well what ‘the person’ is; and that, while one must celebrate its value and demand respect for it, one does not have to question its standing further. (Nancy 1997, 128) Determining the price, ascribing the price-ability of things, the very decision of valuing, remains a sovereign domain. It is the site of political decisionality, the site of political practice. It is not the site of sovereign exceptionality as invoked by Schmitt; it is instead a site for emergence, an ontological moment that effects order. In the case of the ECJ ruling, the court becomes the sovereign that by virtue of deciding instantiates a new order, an emerging order which will reveal itself as intelligible as its effects become observable, which is a bit early to judge at the time of writing of this chapter. However, it is possible to observe at this stage that the blurring of categories such as sex and gender, the belief in the necessity of insurance products to support liberal life, and the expectation of the scientific base of insurance practices noted in the previous section, all coalesce towards a new profiling of life which is not determined, not stable, but defined by its heterogeneity and pluripotentiality.

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Life beyond insurance, life as the potential of becoming

On 2 March 2011, an article entitled ‘The Nukak Makú: a farmers’ nightmare in San Jose del Guaviare’ was published in the inside pages of a prominent Colombian newspaper (Melendez 2011). San Jose del Guaviare is a provincial capital city of about 65,000 inhabitants located by the Guaviare River in the Colombian northern Amazonia, east of the Cordillera de los Andes. The Department of Guaviare is a jungle region traditionally dependent on farming and fishing, and, since the 1990s, also engaged in illegal coca growing and processing. The early establishment of the city can be traced to 1960, although recognition as municipality only came in 1976 and its provincial capital status in 1991. The city has gained international prominence for being home to the majority of today’s Nukak Makú people, an indigenous tribe that was only ‘discovered’ in 1981. The Nukak Makú were traditionally hunters, gatherers, fishermen, and small-scale horticulturists (Neves et al. 2003). They are presumed to have lived in the jungles of this region for centuries practising a nomad lifestyle (Politis, Martinez, and Rodriguez 1997). Organised in small groups, they were used to setting up camps using natural materials found locally and to move on when resources began to be depleted. Using blowguns and poisonous darts to hunt local species, and bow and arrow for fishing, the Nukak made little impact on the local and regional ecosystem and remained uncontacted for centuries by the ‘white’ man (Heckenberger 2009). Although their presence was known of since the 1960s when there were some skirmishes between them and the new white settlers arriving in the Guaviare region, it was only in the 1980s when formal interactions with local urban and farming communities began (Politis 2009). Ever since, the Nukak Makú have been displaced from the jungles to the proximity of urban areas as a result of their jungle region being taken over by illegal coca plantations and having become an area of guerrilla warfare operations (Melendez 2011). Some Nukak have allegedly been killed by guerrillas; others have been forced to work in makeshift coca plantations as a condition for their permission to remain in the areas controlled by the FARC; other groups of Nukak have fled due to the military actions of the army and paramilitary groups (Melendez 2011). This has led them to live under the relative protection of

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local municipal authorities in the proximity of the city in a farm assigned to them. The ‘nightmare for farmers’ described in the newspaper article refers to the very particular features of these indigenous people. The Nukak do not have a concept of private property; for them everything belongs to the whole community. In the forest they can collect, hunt, fish, and grow what they need and there is no price to pay, no exchange to be had, no rights to be respected in order to satisfy their necessities (Politis, Martinez, and Rodriguez 1997). Since the forest provides them with what they need and they live in small groups that change location regularly, they have not had a need for a concept of scarcity or of accumulation either (Politis 2009). They have lived their everyday life in a basic but sufficiently resourced manner closely adapted to the circumstances of the jungles they have inhabited. They had not required a concept of enclosed space (Politis 1996). For them the forest has been an open area only delimited by enchanted ponds, lakes and rivers (Melendez 2011). Their cosmography frames space in the above and the below, spiritual spaces from which the Nukak emerge and to which they go after death. From what is known, they have not required the development of skills to interact with other cultures and remain mostly monolingual; very few of them now understand Spanish (Melendez 2011). As a result of multiple historical displacements by white settlers and other indigenous groups, the Nukak have learned to live amongst themselves marrying between crossed cousins and preventing contact with other humans, although they have known of their existence (Jackson 1991). They also have had a system of rules, for example on what can be hunted and eaten in the forest and how families should be constituted (Melendez 2011). Brocket deer and tapir are considered to have the same origin as humans and cannot be killed. Some species of monkeys are also respected whilst others are hunted regularly. Polygamy has been accepted and a family is formally established when children are born, creating relations of kinship with rights and reciprocal duties. Health, for them is linked to their spiritual beliefs; diseases are understood as relationships between spirits and humans (Politis 2009). They have found ways of healing by using herbs and natural remedies. In their imaginary, suffering is assumed as a punishment by spirits as a result of their bad actions. For example, when missionaries contacted them and established communication in the 1980s, it emerged that their understanding of their moving deeper into the jungles in the 1960s was the result of a punishment inflicted on them by the spirits due to their having taken a white baby away from white settlers. A lack of sense of private property, the absence of ideas such as price and exchange value, the lack of need of a sense of scarcity and accumulation, all create structural difficulties which are part of what the 2011 newspaper article refers to as ‘the farmers’ nightmare’ in San Jose del Guaviare. The big problem, the article notes, was particularly in relation to a group of 170 Nukak relocated seven years before to a farm five minutes away from the city. It was a group comprised of 40 families which were now deprived of the possibility

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of hunting, gathering, fishing and farming in their traditional ways. They were also confined to a restricted physical space and governed through a set of rules and regulations which were alien to them. Exposed to a new way of life and to the diseases and contagion of the local communities, their health was affected and had begun to require the assistance of local health authorities. Whilst contained within the farm, the Nukak have had limited possibilities for providing for their own subsistence and rely on deliveries from the government. A major difficulty is that food deliveries were made weekly and due to the lack of a notion of accumulation and scarcity, the Nukak would consume the goods as soon as possible. This brought along several problems. When the food was consumed, they would venture to the neighbourhood taking animals and food for which they began to be accused of robbery. Providing them with money for the direct purchase of goods was not an option to deal with this issue since their understanding of exchange did not include the notion of value on which capitalist systems rely. There was also the health problem since the new diets and quantities consumed did not correspond to their traditional ones. Issues such as obesity and malnutrition began to be observed and the change from a nomadic to a static lifestyle began to have an impact on their body and mind. Idleness and mental health issues have been identified as a growing problem. The Nukak have been seen as a plague by neighbours who argue that they can no longer grow crops without fear of their produce being taken away. They also complain about the Nukak’s fishing methods that involve the use of plants which contain poisonous chemicals used to numb fish and make them an easier prey with a consequent pollution of water used for drinking. Their neighbours have taken their grievances to the local authorities which have attempted to handle the situation through the institutional means at their disposal: law enforcement, education, policing and sanitation. These are of course western instruments of governance which operate a rationality that the Nukak will take a while to understand and internalise if they are to accept them at all. From an economic perspective, the national government has allocated significant funds for the protection of the group. The problem, however, is that local authorities can only use those funds once they receive an expenditure plan from the legal representative of the Nukak. Due to their simple hierarchies, they do not have one. They operate as a loose association of clans which respect the independence of each other. The money has therefore remained in the local budgets. In the meantime, the Nukak have continuously expressed their desire to return to their ancestral lands in the depths of the Guaviare River towards the Guainía region. According to the article, the government has made several attempts to relocate the group to a reservation in the depths of the jungle but the guerrillas have continuously objected to this, considering those areas as sites of military operations where landmines are thought to have been planted.

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Jungle life versus liberal life The case of the Nukak Makú challenges many of the assumptions usually taken for granted when analysing liberal governance and the workings of capitalism. The epigraph of a novel on the Nukak people entitled Gente que Camina (People Who Walk) reads, ‘lo bueno de caminar es lo que se consigue en el camino’ (what is good about walking is what is found on the way) (Zuluaga 2013, my translation). Walking, for the Nukak, is presented by the author as an ethos, as a fundamental attitude towards life taken as it comes. Life in the jungle demands a continuous awareness of the surroundings and an openness to opportunity. It is not a life driven by established goals and the formulation of expectations. Nor is it a life driven by aspirations. It is a life of survival, of being able to remain alive together with one’s loved ones. Liberal life, in contrast, is one where expectations and aspirations operate as the drivers for action, where the maximisation of an individual or collective interest influences behaviour, where an entrepreneurial spirit is expected to lead towards a telos of wealth. The accumulation of capital leads to investment, which, in turn, leads towards further accumulation. Capital is expected to result from the creation of value where creativity, knowledge, productivity, experience, resourcefulness, and strategic awareness combine to generate novelty. Liberal life is anxious life driven by the uncertainty of what is to come. It is a life obsessed with certainty, with creating it and with using it as the basis for securing a future. However, liberal life is premised on the recognition that there is nothing certain. As such, liberal life is geared towards infinite work with the purpose of generating the ever-growing means for subsistence. The engine for this infinite work is the creation of expectations. An expectation, as noted in Chapter 8, is a projection of a known condition or situation into the future. It is, however, a projection, nothing else. There is no certainty it will materialise. Its promise is powerful. To be able to expect, to be able to make others expect, is an exercise of power on the imagination of the self and of the other. Its effect is a framing of a horizon that might or might not come but that nonetheless delimits a space for thought and action. To expect, or to make others expect is a colonisation of the imaginary which can be understood as an ‘ontopolitical specification of the nature of being’ (Dillon and Lobo-Guerrero 2009, 2). Setting expectations becomes the ultimate political goal that will influence the behaviour of individuals and collectives. Setting expectations, however, is also determining uncertainties. The uncertain, as will be expanded in the next chapter, relates to a position of expected certainty. If certainty is an illusion, the setting of expectations is therefore the creation of the uncertain. To govern liberally entails projecting an expected state of affairs into a future and mobilising resources towards what might affect such a state of affairs. Put differently, liberal governance frames the imaginary of its subjects around the management of uncertainties, which are in turn the result of the creation of expectations. Such a form of governance implies, as noted throughout the

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book, an understanding of time as the site of governance, the creation and refinement of technologies, such as insurance, whose purpose is to replicate expected effects in a systematic manner, and an understanding of value as something that needs to be continuously produced and which is measured in terms of economic growth. The life in the jungle of the Nukak Makú requires nothing of the kind. It is not liberal life. It is not secured through liberal technologies of security. It does not require the role of a state as a political entity. It does not need an understanding of value. It only requires a group of people willing and capable of living in the jungle. Not a comfortable or easy life, but a possible life. The contrast provided by the case of the Nukak Makú allows for a better understanding of the liberal life sought to be secured through life insurance. Issues such as desires and passions, values such as trust, and resistance to capitalist commodification and classification, become clearer when contrasted to the jungle life described, if only basically, with the case of the Nukak. In the world of the film Code 46, as noted in Chapter 3, Damian had decided to live a life of excitement and desire, one where his almost existential curiosity about bats demanded of him to move out of the secure world of the inside into the unsecured world of afuera. The secured world was one governed through and by insurers, where risk was micro-managed based on the power of the Sphinx, a company with total information and awareness of the risks of its clients, and possible clients. Its responsibility was that of the technician, to faithfully apply the rules of formation of a system of thought in order to make sure that what was done was so in the most perfect of ways. Its goal was one of precision in applying the insurantial governing principles of the system. To do so it had developed a complex system of information and control that allowed it to know that Damian had a genetic predisposition to a disease carried by bats that will put his life in danger in case of being exposed to them. To that end it had systematically rejected Damian’s application for a permit to go to the unprotected world knowing that it would lead to his death and to payment of compensation on the side of the insurer, the Sphinx in this case. However, Damian was unaware of his condition. The Sphinx thought it its responsibility to keep that knowledge concealed as a way of allowing Damian to live a life without worries. Nonetheless, Damian wanted to see the bats and tried for many years to find an alternative way of getting his safe passage out of the system. Through Maria he found it and when he finally visited his bats, fell dead. The kind of excitement and thrill that led to Damian’s death is an expression of a life that is not colonised by liberal governance. It is a dimension of life that escapes the rigours of control and liberates the possibility of experience, of unregulated experience. It is a form of experience that does not respond to the certain-uncertain binary on which liberal governance depends. It is instead a form of experience which claims for itself the capacity to feel, to enjoy, to rejoice in the pleasure of pairing desire with action, an experience driven by passions rather than secured and controlled interests.

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The creation of trust through insurance relationships, dealt with in Chapter 5, opens up the possibility of reflecting on this issue as a value at the core of liberal governance. Trust, as the case of uberrima fides denotes, operates as a value for liberal life, both as a condition without which liberal life would not be possible, but also, as a condition for the creation of wealth. Trust is there not analysed as an a priori of the insurantial relationship but as one of its effects. The practices of confession to which the insurantial client is subjected, which relate to the process of individuation referred to in the introduction of this book, are but an element of this effect. Both insurer and insured become enmeshed in a complex set of truth-making practices that, arbitrated by the rule of law, create a truth effect that operates for the duration of the contract. What is interesting to observe here is that this truth effect is only so in relation to the expectation of security that the insurantial relationship created. The security object of insurance is nothing more than the creation of an expectation, which as noted above, frames the imaginary for liberal governance. The truth that results from insurance practices is the truth of the expected certainty created by insurantial imaginaries. The fact that liberal governance needs to generate its own truth is indicative of the technological character of its transcendence. Without relying on universal truths, insurance contributes to the making of liberalism day by day. For the Nukak, trust is not a value since it is not a defining feature of their way of life. For them the principle of association is kinship. The difference here is that whereas trust can be constructed and betrayed, blood ties cannot be undone. Kinship operates as the basic principle of social articulation, which in small numbers, allows for a tightly linked society. Their basic survival relies on such associations. Whereas in insurance individuals are deemed trustworthy if their confession corresponds to facts, in kinship membership of a group is not based on character and behaviour but on family links. The comparison, if simple, amplifies the role that trust, as a value, plays within liberal societies and liberal governance. Trust is required, expected, and demanded, due to the complex interrelationality of processes, functions, and roles that intervene in making liberal societies. In the modern period, as will be explored in future work, trust has developed in tandem with the idea of interest and that of value. Uninterested individuals cannot be trusted since their intentions cannot be held to scrutiny. Unconcern with the idea of value cancels the very possibility of thinking about trust since the relational character of value assumes the role of a contribution to a whole. Value is here an expression of a willingness to contribute to a collective. The Nukak Makú’s case also provides a stark contrast from which to understand two other features of liberalism, the commodification and classification of life. In liberal regimes life has a value that is both moral and commercial. Liberalism, in its capitalist form assumes life to be a resource that can be fostered and developed. Life is here not assumed to be a raw category of knowledge but the result of observations on what is to be considered to be a living human being. Foucault’s enquiries into the life sciences,

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following the work of Canguilhem and others, provide an example of how life is never an abstract object of study but the result of research practices and knowledge formations. Two of the main practices that define what life is to be considered as being relate to practices of commodification and classification. A commodity is a marketable product that does not have its own ontology. It requires in the first place the formation and operation of markets, which, as shown also in Chapter 5, is a continuous and arduous process. Markets, as introduced in Chapter 1, are not a simple formation where demand meets supply but rather a complex site of governance where the frames under which transactions are made possible are defined. The kind of currency, the legal terms and procedures, the rules for inspection and scrutiny, the conditions under which someone is to be trusted as a partner in a transaction, are all practices of governance that intervene in establishing and maintaining a marketplace. To state that something is a marketable product involves the compliance of such objects with the regime of governance expressed through the market. At the same time, accepting a product as marketable and trading in it confirms the existence of the market and legitimises it. A case in point is the premium to be paid for a life insurance policy. The premium does not represent the commercial value of the life at stake. It is expected to represent to the insurer, the prospective cost of compensating for the lack of economic productivity of that life in a given future as a result of specific events (e.g. death, illness). The agreement to pay such a premium on the side of the insured through a contract of insurance, legitimises the existence of a market of life insurance and expects the parties to the contract to operate within the terms framed by the market. Markets here become what Foucault referred to as regimes of veridiction where their truth is the effect of their own work. If life is to be considered a commodity, or better put, if life is to be commodified, it is therefore under the terms of the regime of governance that makes it such. This in turn means that the life that becomes the object of transactions and trade is simply an expression of life, not life itself, but a marketable dimension. The problem arises when such a limited dimension is taken to represent being within liberalism. The infinite creation of wealth for wealth’s sake is but an expression of such a problem. The life that is to be considered amenable to trade and exchange is the result of complex processes of classification. These result in processes of speciation. As the history of statistics and probabilities has shown, life is classified, not arbitrarily, but through the observation of regularities. How such regularities are to be identified, however, is the result of decisions, mostly instrumental, with the purpose of governing individuals and collectives. The very distinctions between male and female, young and old, white and coloured, create boundaries that will determine the limits of how something is to be governed. Coming up with those categories incurs a cost. Classifying life in a particular way entails that other possible and potential orders of classification will be sacrificed. The implications of these decisions are important. For example, if gender and age are to be prioritised when

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identifying a population of soldiers within a group, it might be that particular skills relevant for contemporary warfare would end up being excluded from the soldiering body. If, as shown in Chapter 6, gender is taken as a determining feature in the classification of insurable lives, and if the very practice of using gender as such is not defendable in court due to the arbitrariness of what it is assumed to represent, then the order of classification built upon this category changes. In this case the terms of the regime of governance change the conditions under which life can be commodified through life insurance practices. Life, however, always exceeds practices of commodification and classification. Commodified and classified life are but an expression of what life could be taken to be. The ways in which life is classified bring along particular ways of governing it. Liberal governance, through its technologies, continuously adapts to changing ways of knowing what life is, to environmental changes, and to resistance to its ways of governing. Its resilience relies on its receptiveness to alternatives for the speciation of life. Whereas class, gender and age have been structural conditions for governance in past liberal regimes, these categories matter less and less in a contemporary context. The fact that insurance does not cease to operate after the category of gender is challenged and defeated in court as a basis for actuarial classification is a case in point. Resistance to the commodification and the orders of classification of life is, however, also an object of liberal governance. The regime frames the spaces in which resistance to how life is taken to be can take place. Legal courts are an example of this. The legal challenge to the use of gender as an actuarial category allowed for a change to take place without the need for a revolution. Academia is another example with the principle of academic freedom. It is expected that scientific knowledge can be openly challenged through rigorous testing, experimentation and debate and only the most solid of knowledge be taken as an evidence base. Public protest is another example. It is tolerated but only if conducted within the limits determined by authorities. For example, groups of people are allowed to protest in the streets about a particular measure or decision for as long as they do it within what has been considered to be tolerable, for example, within a given spatial perimeter, a period of time, a number of people. Means employed in the protest might be limited as well. Liberal governance tolerates resistance to its measures but only within its own frames. Other forms of resistance, employing violence for example, would be considered disruptive of the liberal order and could be repressed. However, challenges to the liberal order do take place in more imaginative manners that escape the framing and control of the regime, expression through the arts, for example, as the film Code 46 shows. Individuals who seek not to insure themselves and to live outside of the conditions made possible through insurance are another one. The fact that most of the people in the world remain uninsured is a confirmation of its non-necessity. Coming back to the life in the jungle of the Nukak Makú, theirs is not a life subject to liberal speciation. They consider their life, instead, to be a

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species of a greater whole with which they share their survival. They do not seem to seek to govern nature, they seek to be part of it. They seek to find their means of subsistence and survival ‘on the way’. They do not seek to govern others, they are busy with their own survival in the forest for which they do not require abstractions such as private property, scarcity, accumulation, capital and value, which are crucial for the very possibility of liberal governance. Needless to say, their lives are not insured.

Revealing life as the potential of becoming As analysed in chapter three of Insuring Security (Lobo-Guerrero 2011), the emergence and development of what is known ever since as actuarial life insurance resulted from the need to provide an emergent middle class with a form of security that would not only enable their credit but would also protect their capital in the case of illness and premature death so that it could be inherited by widows and children. By 1753, as observed by J. Dodson, ‘[t]he values of the possessions, and the reversions, of much of the greater part of the real estates, in these kingdoms, will, one way or another, depend on the value of lives’ (Dodson 1753, II, viii). This phenomenon was analysed there as the capitalisation of life, an important element in industrial capitalism and the making and securing of the middle classes. Later on, and in various forms in different European and western settings, various sorts of life insurance were developed for specific populations with particular needs. By 2016 life insurance continues to perform a role of enabler of credit and protection of capital albeit in more sophisticated ways. It continues to be a centrepiece of industrial capitalist investments but it has also become an important element within financial forms of capitalism, as is depicted and analysed in this present volume. What makes this process possible is not the inexhaustibility of life as resource, but instead, what was presented in Chapter 1, following Nancy, as ‘the insufficiency of value’. Making that observation was possible, however, after making the distinction between capable and potential life. It was argued in Chapter 1 that life insurance ascribes value to life based on a problem centred on an understanding of vitality as capacity, capacity that derives from a current assessment of capability projected onto the future. The insufficiency of the value ascribed to life in this process is characterised by a parallel problematisation of life as potential. Potential is understood in this book as resulting not from an assessment of circumstances but from an opening of life to creativity and resourcefulness. Whereas the latter understands life as being, the former assumes life as becoming. Following the arguments of Chapters 1 and 2, the value of life within capitalism and as object of liberal governance remains insufficient. Its insufficiency helps understand why life insurance as an enabler of credit continues to reinvent itself regardless of developments in capitalist cultures and experiences. It helps understand as well the immanent resistance of life to the processes of valuation to which it is exposed. Making this insufficiency of value

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explicit allows for an understanding of the form of violence that life insurance inflicts on life as potential. As an instrument for the promotion and protection of capable life, and as widely argued here, life insurance has become a biopolitical security technology characteristic of the late modern period in western societies. What is violated here is the capacity of such life to be otherwise. Potential life, its pluripotentiality and heterogeneity, as the subject of violence becomes the referent of security in the trilogy of books completed by this volume. To assume potential life as the referent of security entails, however, an epistemic shift, one that moves away from understanding life as a projection, as a modern prognostication of experience – so ably analysed by Koselleck (2004), and that engages with understanding potential as revelation. What is revealed here is not an ontogenesis as the basis of order, but instead, life understood as event. An event, as the surprise that disrupts order, paraphrasing Nancy (cf. Nancy 2000, 159), is not the basis for new paradigms. It does not create the beginning for new orders expressed in the form of culture and morality or theorised as reflexive knowledges. Potential life understood as event operates a different rationality, one where order is not assumed as characteristic and necessary, where contingency is instead the site of political intervention. The security of potential life is therefore not the secure sequence of the lifecourse (birth, childhood, puberty, adulthood, death) and its expected events. It is instead the setting-free of vitality to become and in doing so manifest itself as events that create time. It is not a process in time but a process of time. The revelation of life as potential, as a process of becoming, rivals of course with understandings of history as chronology. It is not an ordering of the temporal as a sequence of events, it does not provide the basis for temporalisations that become the grounds for periodisations – as the ordering of history, in the way Davis so ably criticised (Davis 2008). Nor is it a diachrony of the kind used to understand phenomena as developed over time. It is instead a synchronic temporality, one that focuses on contingency, a temporality of a continuous present, if one was to use the language of chronology to express that which takes place, in colloquial language, ‘in real time’ (see Chapter 4). To speak of a synchrony as the time of potential life does not mean that life can be understood in isolation from anything else or that things are always the same, as a popular understanding of synchrony might take it. Every event is genealogical in as much as genealogy, following a Nietzschean-Foucauldian tradition, is not a search for origins, it does not seek to unearth originary significations or seminal causes, but seeks instead to understand the conditions of possibility of phenomena. Conditions of possibility are here also understood synchronically. They are not causes arising from a past that determine a present. They are constitutive elements of events understood as effects. The logic involved in analysing these conditions of possibility, as discussed in Chapter 2, is therefore not summative, as in an arithmetic equation, but contingent, where the confluence of conditions creates an effect which is

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termed as event. The site of investigation for the genealogist is therefore one of contingency.

Life insurance and the transcendence of liberal governance The main thesis of this book has been that liberal governance, as a regime, transcends through the operation of its own technologies of governance. Life insurance has been approached in detail to explore how this is made possible and what the implications of doing so are in terms of what are constituted as liberal ways of life. The time has come to discuss some of the implications of this thesis in relation to the kind of politics involved in the insurance of capable lives. A first observation is that the insurance of capability expresses a politics centred on an accounting of life. Accounting entails a rendering through metrics, as, for example, the work of Louise Amoore (2013) has nicely analysed. Metrics require standards, units of account, which, as the history of statistics and probabilities has demonstrated in great depth, are as much the result of invention, construction, and discovery (e.g. Desrosières 2010; Bowker and Leigh Star 2000; Daston 1988; Hacking 1975, 1990), but most importantly, the result of complex problematisations of what life is taken to be. Whereas in a form of history focused on the narrative of experience, evental experience, metrics will signify a problematisation at play, metrics within an existing technology will signify a matter of degree. The use of probabilities within a technology of life insurance, for example, takes for granted that the likelihood of the occurrence of a given event can be calculated. The very calculation of probabilities of an event materialising and formulating an instrument of assurance out of such accounting of life, as demonstrated throughout the book, is centred on an understanding of vitality as capability. What follows is that the expression of capability in terms of probabilities places the metric before the phenomena. Phenomena are here expressed in terms of (the medium) calculability. Its terms operate as a constraint for the expression of the phenomena under observation: a life. Life, in other words becomes an expression of a technological ontology, which, borrowing Dillon’s depiction of the idea of governmentality, proceeds through reflexive epistemologies (Dillon 2004, 77). A second observation, derived from the former, is that the insurance of capability entails a politics based on the formulation of events, an evental form of politics. Events here are not taken to be neutral, as Chapters 3 to 6 illustrate. They are the result of observation through the ‘already encoded eye’ and ‘reflexive knowledge’ that Foucault referred to in The Order of Things and which are discussed at the beginning of Chapter 6 of this book. They are not the result of the ‘middle region’ that liberates thought itself, either. They are instead constitutive of an order of the real (see Chapter 8), the making of a world in which action and beliefs play a central role. If the politics of capability entails an evental form of politics, the formulation of those events is in itself a political practice. They result from an active strategisation of what life

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is taken to be in relation to a project imbued by the principles of formation that guide the logics through which such life is rendered actionable. In simple terms, life insurance is an evental form of politics where the event objects of insurance are crafted within the terms of market liberal economies. A third observation is that, because the event objects of insurance are mediated through culture (experience of life) and science (experience of knowledge), the experience of observation, the rendering that results from an exposure to the particularities of life, is not a sensorial experience. It is already a technologised experience, an anaesthetic one where the senses of/ for knowledge are numbed, where being is deprived of expression and sensation. Where the observed capability satisfies the metric, as analysed in Chapter 2, it legitimises the rules of formation (logics) of a system of thought based on specific principles (rationality). With no direct exposure to phenomena, mediated senses are easily trained into the strictures of the operation of technologies of governance such as life insurance. The docile body, to use a Foucauldian term, becomes the unquestioned subject and object of liberal governance. It follows that the process of rendering is devoid of thought and the only attitude of enquiry allowed is that of curiosity (see Chapter 2). Liberals exercise their curiosity about the workings of liberal governance by focusing on the technologies and the logics on which it operates. They, however, do not tolerate an attitude of wondering about the very principles of formation of that system of thought considering such practices dangerous, the potential bases for revolution. The result of this mediated form of rendering is almost an automation of being carefully framed through technologies of governance such as insurance. A resort to unmediated sensorial experience, such as the one desired by Damian Alekan in the world of Code 46 and the narrative of Chapter 3, would constitute a challenge to the accounting of life (observation one above), and its allied evental form of politics (observation two). A fourth observation relates to the insufficiency of sense in the insurance of capable lives. As discussed earlier in this chapter, as well as in Chapters 1 and 2, a politics of valuation of lives is only possible within the sense deployed for such purpose. This invalidates the possibility of having universal understandings of value, for example, in as much as the idea of value would only make sense within the sense it has been thought of. Put differently, the value of life for life insurance is the value ascribed to a life understood in the sense of capability. It makes absolutely no sense to account for such value outside of that sense. Consequently, an understanding of value within a sense of potentiality would always be insufficient since potentiality defies attempts at definition and conceptualisation. It would amount to thinking a value without value, an insufficiency of sense, whose real value is that of falling ‘in the middle region’ that liberates thought itself. How to give credence to such insufficiency can be done through the role of the work of art, such as that which Code 46 plays in this book, or by providing stark contrast as intended with the case of the Nukak Makú earlier in this chapter.

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A politics centred on the accounting of life, on evental forms, on the technologised experience of the liberal subject, and on the insufficiency of sense, is a politics that can only proceed through its own ontologies. Its transcendence derives from its capacity to re-create the system of thought on which it operates, and from the accuracy and precision with which its logics and technologies work. The transcendence of such politics will rely also on its capacity to secure itself by framing forms of resistance within terms it considers tolerable within the language of technical failure, and to prevent at all costs challenges to the principles of formation of the system of thought. Whereas criticism of the inefficiencies of the system will be tolerated and indeed encouraged, resistance against principles such as the idea that individuals and collectives must be driven by interests, will be suppressed. Part of its technological outcome will be to create spaces for dissent by dictating the very terms under which opposition and disagreement can be expressed and practised. In this respect, the transcendence of liberal governance is one of technological efficacy, a position that makes it possible to understand its historical capacity to incorporate difference when it falls within its frames of tolerance. It also allows for understanding its historical difficulty to deal with radical transformation and change. Whereas the history of liberal governance demonstrates a great capacity to accommodate, and indeed to govern, changing circumstances, it does not exhibit a good record in dealing with radical challenges in its own terms. Expressions such as illiberal practices of liberal regimes come to mind when thinking of how liberal regimes cope with realities such as terrorism and catastrophe (e.g. Bigo and Tsoukala 2008; Amoore and De Goede 2007; Dillon and Reid 2009). Constitutional practices such as states of exception, illegal practices such as extraordinary rendition, and criminal practices such as abduction and torture are but examples of this. Such practices can be seen as exposing the fallibility of liberal regimes. They can also be seen as exposing the possibility that governance does not need to be liberal to be effective. It is perfectly possible to consider that liberal regimes can coexist with alternative forms if their frames of tolerance expand to contemplate such possibilities.

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An epistemology of life insurance

Insurers are responsible for the making of their own world. As Clark and Anderson put it in their edited book The Appeal of Insurance, [p]erhaps more than any other business, insurance grew in concert with a clientele largely of its own making. Left to its own devices, the public has preferred to avoid confronting the certainty of fatality or the probabilities of catastrophe. It has therefore been the particular task of insurance promoters to create a demand for their products, first by persuading the public to see the world as ruled less by divine judgments and more by statistical patterns, and second, by proclaiming a moral imperative of hedging against death and disaster by the prudential recourse to insurance. (Clark et al. 2010, 3) In creating their world, insurers are also responsible for creating an order that is by no means natural. It is an order that results from coupling their own imaginaries with their insurantial practices, imaginary and practices that are part of the liberal forms of life they have historically sought to serve and from which they have served themselves. The order that insurers contribute to is one driven by uncertainty where individuals and collectives are always exposed to risks they were not even aware of. For insurers, any form of activity can have its associated risks and is therefore in need of protection. Their products and services are advertised as fit to serve such exposure to the uncertainties of life. The pragmatic approach that insurers offer to the public must, however, be the subject of careful epistemological analysis. The order they contribute to create and the security they promise to provide are anchored on a logic that brings together beliefs, emotions, expectations and aspirations, with practices of reckoning and managing the uncertain, and sometimes aggressive marketing strategies to colonise the imagination and fears of the public. In the process, they create a market for securities in the form of multiple product lines, products which in turn are to become the basis for derivative products in financial and capital markets. Insurers constitute their own order of the real.

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Orders of the real can be understood as authoritative ways of rendering the world. A rendering entails imagination but it is in itself a performative practice. To render involves a representation of the world. It involves an assemblage of beliefs, knowledges, attitudes, discourses, and traditions that taken as a whole constitute what, following Nietzsche and Foucault, can be called regimes of truth. As regimes, they display a form of prevailing power, not a single one, not an absolute, but one that will endure for as long as the conditions that gave rise to it remain unchanged. Regimes of truth are precarious effects of power that require a continuous, if heterogeneous and complex, agency. Their role is to ascribe validity to decisions. Orders of the real do not reveal a state of affairs as natural. If approached as empirical sites, as sites for creative investigation, they help understand how the world is known, how a knowledge-base is produced or inferred, and how decisions on acceptance or rejection of new ideas and knowledges are made possible. When investigated they expose the presuppositions of knowledge and belief, the rationalities, logics and technologies at play in making systems of thought operable. Approaching orders of the real as sites for investigation allows for an observation: rendering is always an empirical endeavour. An authoritative rendering of the world is therefore not disconnected from epistemology; the practice of rendering is always linked to the system of thought that allows an imaginary to be possible. The empiricism of rendering relates to an epistemological problematisation of being in the world. The way in which insurance renders the world constitutes an empirical order that can be interrogated as an epistemological formation. This chapter engages with a reflection on the epistemological formations of life insurance. It does so by focusing on five insurantial effects. First, life insurance operates a problematisation of fear by posing and acting upon an understanding of uncertainty. Second, life insurers assume capable life as an aging course that constitutes the basis from which to develop an almost frontierless market. Third, life insurance provides a form of credit that renders life as capital. Fourth, life insurance creates moral economies which intervene in the governance of the conduct of individuals and populations. And, fifth, life insurance is a technological effect of liberal governance that helps understand the ways in which liberalism transcends.

Uncertainty and the operationalisation of a problematisation of fear A problematisation, as nicely put by Bacchi, a follower of Foucault, is an ‘enquiry into the terms of reference within which an issue is cast’ (Bacchi 2012, 1). These terms of reference are not based on ready-made-objects but on relations (Veyne 1997, 181). Relationality becomes the effect of power relations, the site where these become visible, observable, and analysable. These relations are usually not explicit. They require from the analyst an effort to give them form, to extract them from a discourse where they play a fundamental role but where they usually remain tacit and anonymous. The

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point of the analysis is then ‘a matter of distinguishing the components of any historical formation, any set-up, finding the links between their components and revealing the singularity of everything’ (Veyne 2013, 35). The purpose of doing so is to expose the truth of the discourse in its own terms. As put by Veyne, ‘[a]s soon as one makes a discourse explicit, its arbitrary and limited nature becomes apparent’ (Veyne 2013, 37). Life insurance problematises fear by rendering life and the future capability of life as uncertain. Uncertainty is a concept that, paraphrasing Foucault when challenging the unities of discourse, ‘must not be accepted without question’, the tranquillity with which it is presented and accepted must be disturbed (Foucault 2002, 28). The urgency of doing so lies in the role uncertainty plays in the articulation of security discourses within liberal governance. Taken for granted, uncertainty is generally understood as an undesirable ‘non-state’ of affairs, a limbo which escapes the realms of governance and stability, a site of non-order where knowledge ceases to provide a basis for action, an exposure to the unknown and the unknowable. Such assumptions beg the question as to why a liberal imaginary requires uncertainty to be understood in that way. An approach towards an answer, explored in Chapters 2 and 8, is that such an understanding of uncertainty is a necessary condition for the intellectual plane on which liberal discourses and practices operate. Uncertainty on its own does not signify disorder or vulnerability. Uncertainty refers to exposure, to an openness derived from a lack of stricture to sense (cf. Nancy 1998), to a non-state lacking order, to the absence of an operating structure. Assuming uncertainty to be a negative state is anchored on a moral judgment based on a way of thinking that assumes certainty, stability and continuity to be a desired state of affairs. Assuming uncertainty as an opportunity is supported by a way of thinking that seeks to liberate thought from its moral strictures. Whereas the former relates to a politics of continuity in which what matters is the creation of stability and order, the latter emphasises the possibility of alterity and possibility. As noted in Chapter 2 and followed on in Chapter 7 in this book, the first leads to a politics of capability, the second to a politics of potentiality. Koselleck used the term ‘horizon of expectation’ (Koselleck 2004, 255–275) as a space for action in a future which will be continuously postponed. He illustrated the idea by retelling a political joke where Khrushchev in one of his speeches declared: ‘Communism is already visible on the horizon’. When asked by a member of the audience about the meaning of horizon, he replied, ‘look it up in a dictionary’. In doing so the definition that came out read: ‘Horizon, an apparent line separating the sky from the earth, which retreats as one approaches it’ (Drozdzynski 1974, 80 – as cited by Koselleck 2004, 261). Horizons of expectation are of course not the privilege of liberal imaginaries, as evident in the joke. What are the privilege of liberal imaginaries are the rationalities, logics and technologies through which these horizons are created. By creating horizons of expectations governments as well as other agents make plans in the present with the intention of generating effects in a future.

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Planning, as elaborated in Chapter 4, is a form of prognosis as explained by Koselleck, who argued that the advent of modernity can be understood by the challenge to the medieval imaginary of God’s omnipotence which led to the need to render the future actionable. A prognosis entails the projection of what he referred to as experience into a future in the form of an expectation. Experience ‘is present past, whose events have been incorporated and can be remembered. Within experience a rational reworking is included, together with unconscious modes of conduct that do not have to be present in awareness’ (Koselleck 2004, 259). Expectation is also a present idea. ‘It is the future made present; it directs itself to the not-yet, to the nonexperienced, to that which is to be revealed. Hope and fear, wishes and desires, cares and rational analysis, receptive display and curiosity: all enter into expectation and constitute it’ (Koselleck 2004, 259). Both concepts are to be understood in relation to each other, although they are of different orders (2004, 259): ‘No expectation without experience, no experience without expectation’ (2004, 257). Without a horizon of expectation it would not be possible to prognosticate, and without the possibility to prognosticate it would not be possible to calculate into the future in the form of probabilities. Without the calculation of probabilities it would not be possible to define calculable life as an object of governance and rule. To argue that the intellectual plane of a liberal imaginary requires a negative conception of uncertainty in order to exercise governance relates to this idea of planes of expectation. Uncertainty is a concept that lacks its own meaning and can only be defined relationally with regards to its opposite, certainty. Uncertainty and certainty constitute a semantic field. Uncertainty relates to the creation of expectations of certainty. Certainty is understood here as that which is expected to be or to become true. Traditionally defined as the opposite of certainty, the concept requires an engagement, a relational engagement with how certainty is construed as a fact, as a matter of truth. As widely discussed by Nietzsche and Foucault and many of their followers, within discourses of truth, as soon as a form of knowledge becomes authorised or is granted the authority to speak by virtue of its origin, method, or tradition, it becomes the legitimising object of discourse. In other words, truth becomes the vehicle for the legitimisation of authority. When the source of knowledge and its authorisation changes so do the ways in which it legitimises discourse. Likewise, when something considered certain changes, so do its correlated uncertainties. The question of what uncertainty is should therefore be addressed as a question of how a certainty is constituted, a questioning of the horizons of expectations on which it relies, an interrogation of the forms of knowledge, beliefs and affects that interact in constituting regimes of truth that in turn legitimise discourse and action. To state that life insurance problematises fear refers to the ways in which its technology operates as rendering reality uncertain. Uncertainty relates to how those planes of expectation are created, and as argued throughout this book, such creation is a technological outcome, in this case, the outcome of a technology of life insurance.

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The way in which life insurance problematises fear is tightly linked to its role as a security technology. Life insurance creates a promise of protection. A promise creates an expectation, an imaginary of security ‘which will retreat as one approaches it’. The temporality involved is important. The security life insurance creates is yet to come and should materialise only if the insured event happens to occur. Its value as an expectation, however, does not materialise in a future but takes effect in a present. The security of life insurance secures a present capacity to become and remain a liberal subject and to dwell a liberal life. This present must not be understood as an instance that is to pass and that precedes a future. It is instead the contingent moment of life, of lived life, which never ceases to take place, a continuous present. The life object of insurance is always a present one. The fear upon which this problematisation operates, however, is not a natural one. The technology of life insurance needs to simulate a telos of security and stability which can be achieved by the consumption of its products. In a similar way in which Christianity instantiates an economy of salvation around imaginaries of heaven and hell, which need to be depicted, life insurance is only possible through the formulation of an anxiety about life’s precariousness, its exposure to uncertainty. It is not for granted that life insurance advertisements constitute a form of eschatology. ‘If you care for your dear ones, then you must protect them’. As a problematisation, the fear that life insurance creates is inexhaustible.

Capable life as an aging course Populations have here been understood following Foucault as described by Hacking (1986) in his ‘Making up People’. Populations are not a natural entity but the result of statistical exercises that involve decisions on what to count and how, with the purpose of generating knowledge about a particular phenomenon and acting upon it. Populations are an instrument of a form of governance, a liberal one in the case of this book, that requires detailed knowledge about individuals and collectives, the way they live, reproduce, work, the specificities of their health, their economic life and work, their beliefs and values, and their expectations and aspirations in life. By knowing about people, economic and political projects can be advanced by classifying individuals and collectives into populations and targeting planning and policies on these groups. In this respect, populations become epistemic objects, objects of observation and analysis from which knowledge can be extracted, and simultaneously, subjects of governance and intervention through which the aims of economic and political projects can be furthered. Insurers sit at the intersection of an economic project and a political one. Detailing these projects in their generalities is important to understand the kind of subjectivity they create and expect from clients. Economically, their business model operates on the capacity to transform uncertainties into risks, create products through which these risks can be managed, and invest income

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generated through policies into property, financial products, and bonds. Politically, commercial insurers require a system where they can accumulate and invest the money collected through policies, a legal order where the rule of law allows them to enforce contracts, and a market economy where they can trade their products. The populations they observe and the subjects they act upon are part of these economic and political projects. They are not individuals and collectives in their own right, they are consumers within market economies who seek insurance in order to promote and protect their livelihoods and lifestyles, and liberal subjects who participate of a system of governance and rule under the belief that such a system can enhance their freedom and protect their rights. Individuals and collectives, as clients, are already constituted as a population that seeks or could seek insurance as an instrument for developing a liberal life. When insurers approach them as an epistemic object they are already constituted into the client or potential client, a broad population which renders them observable in insurantial terms. Such observability is important since as epistemic objects they are not taken as raw, undefined material, but as individuals with the predisposition to be insured. It is important, therefore, to introduce a clarification on how an epistemic object is understood here. Hans-Jörg Rheinberger, in his Toward a History of Epistemic Things, distinguished between epistemic things and technical objects when analysing experimental systems. For him, the distinction was relevant since an epistemic thing would remain open to observation until operated upon by technical objects that would be used to do precisely what they were designed to do. When a measuring instrument was employed to provide an account of the size of the thing under analysis, the measuring object was used to measure and by doing so it already qualified the thing in terms of size. The initial quality of the object as open to observation has now been transformed by the employment of the technical object. In his words, ‘[t]he technical conditions determine the realm of possible representations of an epistemic thing; and sufficiently stabilised epistemic things turn into the technical repertoire of the experimental arrangement’ (Rheinberger 1997, 29). The key for governance is to stabilise epistemic things. As understood here, an epistemic object is already the result of the technical object having intervened in the epistemic thing. The epistemic object at stake, i.e. the client, has already been rendered observable through technical elements and processes that are deeply involved in the insurantial logic of the insurer. Already framed as observable, as a population of possibly insurable clients, individuals and collectives are then assessed in terms of the levels of risk they would present the company with if insured. The assessment of the client will never be in the abstract, it will always correspond to a specific event for which insurance is sought. Such an event will not be a general one either, it will relate directly to the client and his/her particularities. What becomes generalizable later in the process is the treatment the insurer will give to the client in term of the level of risk he/she represents. Similar levels of risk will be grouped together in

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insurantial pools that will be used to determine the price of the premium to be paid by the client. The client, then, becomes an observable epistemic object with specific biological, social, cultural and economic characteristics of relevance to the insurer. From the insurer’s economic perspective the client represents a lifelong business opportunity since its life could be exposed to as many events as formulated. And hereby comes the opportunity upon which insurance operates, the life course. Within life course studies, a widely accepted way of defining the concept of life course is as ‘a sequence of socially defined events and roles that the individual enacts over time’ (Giele and Elder 1998, 22). How these events are defined, however, is not only a social matter but is affected by the role of technologies such as life insurance. The life cycle here transcends the traditional continuum of birth-infancy-childhood-adolescence-adulthood-maturityold age. Each one of these stages can be understood in various ways and insurance qualifies them in quite a particular fashion. How insurers render events such as birth and death, as evident in Chapter 4, is not simply a matter of a new life having been born or having ceased to exist. It becomes also a matter of expectations, of financial expectations related to the new birth. Birth, as seen by life insurance, qualifies the capability of the new baby to develop throughout the life course by having access to the goods and services such a trajectory requires, as it qualifies the life of the parents who are now expected to provide for the new life. The life of the family breadwinners, their capable life, is now one that needs to provide forms of protection for the new child in case things go wrong. Events such as infirmity, premature death, accidental disability, unemployment and loss of income, all become events against which insurance can provide a form of security. As the child grows, ensuring his or her education and higher education become a pressing matter. Protecting the family home so that in case of any of the events mentioned before the child will still have an asset to provide for its upbringing is presented as the responsibility of the parents. Insurance advertising targets clients’ emotions regarding a parent’s responsibility to protect and to provide for their children. They typically depict a happy family scene with the intention of showing that what can be, can also cease to be, and protection must be bought to compensate, financially, for the loss of the breadwinner. Although children and families in many emerging economies and so-called developing countries remain un-insured, and their way of life does not make insurance protection an indispensable security, parents in emerging and advanced liberal economies are targeted as subjects that, if responsible, should provide for their potential loss. Old age is another example, as noted also in Chapter 4, where a stage of life becomes an insurable event. With life expectancy continuously improving, the costs of maintaining vitality are also increasing. Old age becomes for insurers an opportunity for profit in as much as it becomes an insurable event. What becomes insured in this case is not death but its deferral and the money claimed for surviving a particular age is used for covering health and caring

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costs for which the pension of the individual might not be enough. Alternative forms of financial provision for these cases, such as family capital derived from property and assets, as well as help from family members who remain economically active, could be spared if responsible financial planning with health and life insurance products is done in time. Presented in such ways, the rendering of the life stage within the life-cycle is not solely a social matter. It becomes part of the epistemic object upon which life insurance technologies operate in the process of transforming life stages into events that can be insured against. A central element involved in this insurantial rendering of capable life is the temporality that results from framing life through events. Events are not simple occurrences or accidents. Events for insurers have been thought of in a present in relation to what could possibly happen in a future. In this respect, events are potential materialisations of scenarios thought of in the present. The logic of temporality here, as argued in Chapter 4, is not linear, and is far from simple. It involves what could be understood, after Koselleck, the operation of multiple simultaneous temporalities (Koselleck 2002; Jordheim 2012). What matters at this stage is to highlight the role that insurers perform in what is analysed later in that chapter as the strategic production of the time of the event. Rendering birth or old age as events for which insurance protection can be provided involves a plethora of techniques and practices involving modelling, the creation and simulation of scenarios, and ultimately, the hedging of time. These are not simple practices and involve an articulation with the financial and capital markets which requires a great degree of creativity, imagination and the capacity to strategise a business model, within a political context, and the voraciousness of the financial and capital markets in their quest to financialise and securitise any possible cash flow and asset base available in the markets. The simple natural and innocent birth of a child becomes an important contribution to the creation of financial derivatives anchored on the expected responsibility of parents to provide security for their children. The admirable protraction of vitality that results from an ever-increasing old age becomes the basis for a growing market in vitality bonds through which the potential of longer lives becomes securitised in the capital markets. The assumption that life insurers make in understanding capable life as an aging course is therefore not an innocent one. It becomes the very condition of possibility for a continuous extension of the margin of action of insurance through the creation of insurantial markets. It is the possibility of an endless generation of insurable events always in relation to the satisfaction or creation of new expectations on how capable life can be promoted and protected. In doing so insurers contribute to the creation of a liberal horizon of expectation, which, as horizon, is ever deferred.

Capable life as capital An economy is understood here as an order of governance, one where activities are strategically programmed (cf. Foucault 2008, 223). Strategically does

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not mean planned or prescribed in detail. It refers to an artful combination of heterogeneous elements with a purpose. An economy is not simply a process where demands are matched with supplies and where ideas such as scarcity and price are natural. It is instead a site for governance where consumption and production are modulated in such way that scarcities and prices are part of the outcome. The strategic programming of activities in an economy are expected to generate specific outcomes. The result, however, will not satisfy expectation since the expression of capability and potential in life will exceed any strategisation. Whereas a life can be subjectified in such way that the behaviour of an individual appears to be predictable, life, as illustrated and analysed in Chapter 3, will always exceed the subject. The subjectification that life insurance effects can be observable in the cases explored in this book through the ways in which life insurance, as technology, renders capable life as capital. It has been mentioned that a rendering entails a performative practice that represents the world. It should be added here that it does so in ways that are amenable to understanding and to governance. Rendering as capital entails an a priori conception of this concept which frames the ways in which a life is understood as financially productive. Rendering as capital understands life as capable of a liberal existence and dwelling, a life which is assumed to be that of a consumer and of a producer of goods and services, and one that is expressible in the form of livelihoods and lifestyles. Life rendered as capital creates a form of subjectivity that makes life responsive to particular forms of governance. It creates an economy of power characterised by the expectation that behaviour can be governed with expected outcomes. Life rendered as capital subjectifies individuals and collectives, it renders them docile to the technologies of governance which employ the rules of formation of a logic that seeks to strategically programme individual and collective behaviour in a way conducive to an end, as elaborated in more detail in the next section. By constituting economies of governance around a priori conceptions such as capital it is possible to make observations about ‘the way life is’ which are not objective in any form but are the result of a second-order observation from a conception of capital (cf. Luhmann 2000, 54–101). Put differently, taking capital as the foundation stone for an understanding of value allows for observations on how insurers render life as capital. The first observation relates to the insurer’s concern with life as capability rather than potential. As expressed in the case of the story of Nathalie narrated in Chapter 1, the life object of insurance is a life that can be expressed in terms of a current capacity to earn and consume, and a future capability to continue to do so in a stable or incremental way. It is expected that an insurable subject will improve its material conditions throughout the life course, be it through increased productivity, accumulation of capital, the result of investments, or enhanced knowledge and experience. This understanding of life as capability assumes the client to be an element of human capital that can be invested in and promoted as the basis for the future creation of

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economic value. The credit made available to the client through the collateralisation of its own life by means of an insurance product, is the manifestation of an understanding of life as capital whose value is represented by a future capacity to earn. Such rendering of life as capital implies of course a second element, namely, that capable life is the result of the disclosure of truth. As discussed in Chapters 1, 2 and 5, the truth of the life object of insurance is a complex process of veridiction where clients and insuring agents interact in stating facts around insurable events. The client is expected to reveal to the insurer any information relevant to ascertain its level of risk in relation to an insurable event. A history of breast cancer in the family, for example, when applying for a life insurance policy, is a case in point. To the insurer it would not be of much interest to know that the grandmother of the applicant was a great poet whose illness inspired profound reflections on the notion of being and beauty. What matters is the cause of her death, a cause considered to be relevant to the calculation of a particular risk of premature death by their client. Failing to reveal knowledge of this fact could be taken as cause for invalidating the policy. How truth in relation to such events is sought, however, matters greatly. How a question in relation to a client’s family history is phrased can change the meaning of the truth expected to be contained in the answer. Insurers’ questionnaires, and particularly, questionnaires sent to medical practitioners who have information on the client’s medical history, are carefully worded to frame the truth-value to be obtained from their answers. It is not a universally valid truth, it is a truth that matters to the event object of insurance in relation to the insurable interest, that is, the client’s need to collateralise his/her own life as a means to obtain credit to purchase an asset. The ways in which insurers extract information from their clients to reveal facts of interest to their business are a fundamental aspect of rendering the life of the client as capital. An insured life is already life turned capital, which as shown in Chapter 4, becomes the basis for further capital accumulation and exchange, more recently, in the capital markets. Allied to the disclosure of relevant truth is the element of traceability of life. Insurers’ interest in the disclosure of facts from the side of the insured involves also the capacity to trace the veracity of such information. Medical questionnaires sent to medical practitioners are of course a means for this, but what happens when the client has medical records that only cover recent years? It would be expected that an individual who has migrated from another country should be able to produce medical records from the place of origin. But that country might not operate the same ethical principles on which the current country’s health system works. It might also be that the client has been a continuous migrant with no stable domicile over a period of time. Insurers might doubt the legitimacy of foreign medical records or demand clinical examinations to verify them, if in doubt. However, a life without a verifiable history of capability is one that raises doubts. The credibility of the individual’s revelation of truth can be put into question if not

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backed up with authoritative evidence. The rendering of the life of the client as capital relies intensely on the authorisation of the truth from which facts, relevant to the object of insurance, are established. Finally, another element discussed in this book that contributes to the rendering of life as capital is that of the stability of gender as a principle for insurantial classification. When, as analysed in Chapter 6, insurers were challenged with providing evidence that supported their practice of discriminating between men and women in their underwriting of risks, it became clear that such evidence was not sufficient to justify using sex as an underwriting category. As noted there, the distinction between sex and gender in discourses during the debate that led to the European Court of Justice ruling on the matter, was not clearly cut. What the debates revealed, however, was how insurantial classifications related more to gender as a cultural category than to sex as a biologically determined feature. Whilst arguing that historically men and women have displayed certain regularities that must be taken into account when underwriting risks, insurers were not in a position to demonstrate how a categorisation by sex did not result in arbitrary discrimination. It also emerged how difficult it is for individuals who do not fit within the male/female distinction to be classified as subjects of risks. From an epistemological perspective, that insurance practices rely on the stability of genders for the assessment of risks reveals a story of the role of culture in the process of rendering life as capital.

Capable life, moral economies and liberal political communities The idea of moral economies, a recurrent issue in this trilogy of books, is not unequivocal. E.P. Thompson and his followers used the term when challenging the logics and practices of capitalism. For Thompson morality was related to an economy based on goodness, fairness and justice, where production and consumption and the understanding of price were related to the needs, desires and means of the people. When the price of goods was determined by wider external markets and local people who required those locallyproduced goods could not afford them, the resulting economy was one which did not correspond to criteria of goodness, fairness and justice (Thompson 1971, 2013). In these books, the lead of Lorraine Daston’s use of the term has been taken to argue that a moral economy should not be understood normatively but as an instantiation of a form of governance. An instantiation is a representation of an abstraction. Governance is here taken to be the abstraction, not a universal one but one that always corresponds to the effects of an exercise of power. In this sense, governance assumes a concrete form depending on the particular forms of power involved. Although not concerned with forms of power per se, Daston’s article ‘The Moral Economy of Science’ shows how scientific categories such as fact and evidence, operating as abstractions around which modern understandings of science are

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organised, depict a very particular form of governing experimentation and knowledge. In her analysis these categories could not be dissociated from moral economies which she understood as a ‘web of affect-saturated values that stand and function in well-defined relationship to one another’ (Daston 1995, 4). As illustration, she presented some facets of quantification, empiricism and objectivity to indicate how features ‘deemed most characteristic of science as a way of knowing’ require moral economies to be possible (Daston 1995, 3). The governance of knowledge that results from employing categories such as fact and evidence as guiding principles constitutes an empirical site from which to interrogate the moral economies that make them possible. In Insuring Security the abstraction inspiring the book was that of risk understood as fungible uncertainty, a kind of magical moment where something that does not exist is turned into a security amenable to trade and exchange. The vehicles employed in doing so varied from the third-party contracts of the medieval renaissance all the way to parametric forms of insurance used for creating weather derivatives in the twenty-first century. In Insuring War, the abstraction was a form of insurantial sovereignty that resulted from the ways in which the British state employed marine insurance to wage war in the modern period. The vehicles ranged from gentleman-like alliances between the Board of Admiralty and Lloyd’s of London to war risks insurance schemes devised for the world wars, elements of which are still in place. The abstraction, in this third volume is the rendering of life as capital that results from insuring lives in the liberal world. The vehicles through which this abstraction is represented are the multifarious mechanisms through which life insurers transform life events into opportunities to develop insurance products. As instantiations of forms of governance, moral economies can be observed on the effects they have on their subjects. They do not relate directly to objects or institutions but to the subjectivities that result from them. To think of a moral economy is therefore to think of the subject whose conduct is the result of the stabilisation of epistemic things. Consequently, moral economies here relate not to objects or institutions but to subjects. Observing moral economies helps make evident the operation of the subjectivities at play that result from stabilising epistemic things into epistemic objects. The behaviour of individuals ceases to be unexpected and becomes part of the wider liberal horizon of expectation. Principles of formation such as that which assumes individuals to be interested subjects driven by a desire to maximise utility become quasi-laws that allow for the expectation of a particular order within and amongst societies. It must not be forgotten, however, that these subjectivities arise out of abstractions, and abstractions need to be represented if they are to become the ground for any form of governance. The questions for the analyst are therefore, how is the abstraction made possible, and how is the abstraction represented? Answers to those questions will make a moral economy visible to an observer concerned with understanding how a discourse of power, expressed as moral, can be stripped to reflect its assumptions. In the

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case of this book, the abstraction of rendering life as capital is made possible through a technology of life insurance. Little has been said until now about the technological character of this ensemble of power-knowledge.

Capable life as technological effect Insurance itself cannot be an abstraction. Paraphrasing Ewald (1991), there is no such thing as insurance in the abstract, only insurance technologies and products that create insurance effects. Ever since the 1774 Gambling Act in England, where the need to demonstrate an insurable interest became a legal condition for writing an insurance contract (see Chapter 2 of Insuring Security), the ways in which insurers transform uncertainty into risk must be publicly represented and demonstrated. The very transformation of uncertainty into risks, as shown throughout the first two volumes of this trilogy, is the result of a technological practice. Technology within the study of society and governance remains a controversial issue. In 1937, Read Bain offered a definition of technology in terms that remain influential within the social and human sciences but that have nonetheless sparked a heated debate. For him, technology includes all tools, machines, utensils, weapons, instruments, housing, clothing, communicating and transporting devices and the skills by which we produce and use them. Social institutions and their so-called non-material concomitants such as values, morals, manners, wishes, hopes, fears and attitudes are directly and indirectly dependent upon technology and are mediated by it. (Bain 1937, 860) If life is to be understood as dependent on technology, as Bain suggested, or if technology is to be taken as supporting life as characterised by values, morals, manners, wishes, hopes, fears and attitudes, is clearly a debate that relates to understandings of human agency within society. Within such a debate, however, it is important to explore how the human should not be taken as a transcendental entity but one that can already be understood as a result of technological agency and that is also capable of resisting it. Rather than assuming the human in abstract terms, what is at stake here is the idea of an individual who is subjected to myriad processes that influence his/her behaviour and attitudes in specific ways. When observed as repetitive processes it is possible to identify a technological agency at play, one with the clear intentionality of shaping the subjectivity of the individual in specific ways. Understanding technology in this way relates to the style in which Michel Foucault spoke of what he called ‘technologies of the self ’ (Foucault 2005). Although Foucault did not offer an unequivocal understanding of technology throughout his work, as described by Behrent, in the latter period of his life – between 1980 and 1984 – he consistently explored the wider theme of

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technologies of power as effecting the self and other entities (Behrent 2013, 90–92). His aim was not to formulate a general theory of power and technology, but instead to offer detailed histories of how subjects are created and governed through very specific forms of power, power understood here as a productive force (see Foucault 2012). As noted by Sawicki, Foucault ‘does not attempt to provide a general account of the practices that compose the “essence” of modern technology, but rather specific histories of technological practices that have been overlooked in traditional accounts of modern forms of power’ (Sawicki 2003, 69). Foucault’s understanding of technology as related to power was central to his claim against a transcendental understanding of ‘man’ as the centre of humanism. As Behrent argued, Foucault’s modern conception of ‘man’, ‘belonged to the same epistemological stratum as most technological applications of power (in say, the modern prison or hospital), even enhancing their unwavering effectiveness’ (Behrent 2013, 65). Technology ‘is thus both a form of power that “produces” individuals in ways that integrate them into political and economic structures by supervising, subjecting, and normalising them, and a term that dispels the illusion of the “individual as abstract subject, defined by individual rights”’ (Behrent 2013, 82). An understanding of insurance as technological refers to its role in transforming individuals into subjects, subject of power, governance and rule. Insurance constitutes a technology of government. Rose defined technologies of government as those ‘imbued with aspirations for the shaping of conduct in the hope of producing certain desired effects and averting certain undesired events’ (Rose 1999, 52). ‘A technology of government […], is an assemblage of forms of practical knowledge, with modes of perception, practices of calculation, vocabularies, types of authority, forms of judgment, architectural forms, human capacities, non-human objects and devices, inscription techniques and so forth’ (Rose 1999, 52). A technology of governance, however, must not be understood in isolation from the logics from which it arises. Whereas, as noted earlier, the epistemic object of insurance remains an abstraction, rendering a population observable in insurantial terms, that is, turning individuals and collectives into epistemic objects, is the role of insurance as technology. Its job is to continue the process that a previous moment, that of a logic, tasked with providing the rules for the stabilisation of epistemic things, had started. Ascribing individuals (clients) to populations, and making the uncertainties of their capable lives fungible, is already an effect of this technology. The role continues. Expanding on Chapter 2, a technology is here understood as a set of practices that are repeated, systematically with intended and expected effects. A technology operates an order of repetition determined by a logic which dictates the rules of formation of a system of governance. Whereas the technology of life insurance draws on abstractions such as life, capability, risk, and uncertainty, its role is material. The outcome, although systematic and based on the application of rules and protocols, is unique and tailored to each

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individual case. Every insurance product relates to an assessment of vital capability in relation to specific insurable events. In this respect, insurance is a tailored technology of governance which creates as well as insurance policies, moral economies.

Transcendence and life insurance as epistemology Epistemologically, the significance of the technological character of life insurance relates to the general problem presented in this book, that of the transcendence of liberalism. In Chapter 2 this problem was presented as one where the very possibility of liberalism relies on its capacity to govern life. The effect of liberal technologies of governance is to produce liberal life in such way that liberalism becomes its own technological ontology. Such possibility to transcend relies on the operational capacity of its technologies. If they fail, so will the endurance of liberalism. The technological transcendence of liberalism relates to the understanding of value on which life insurance operates. While rendering life as capital, life insurance governs through a successful problematisation of fear, through an understanding of vital capability as a life course, and by the constitution of moral economies. The effect of this form of governance is a very particular way of being in the world that is neither sufficient nor necessary and is thereby in continuous need of reformulation. As a technological effect, liberalism needs to continuously produce its own ways of rendering the world. The production of its orders of the real is a creative ensemble of beliefs, knowledge, attitudes, and discourses that brought together constitute the truths on which insurance operates. What ultimately transcends in the transcendence of liberalism is an experience of governing. As experience, it relates to a way of knowing the world and relating to it.

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Index

1774 Gambling Act, Britain 19, 89, 102, 133 1774 Life Insurance Act, Britain 75 Achampong, Francis 77 actuarial science/practice 18, 45, 103; insurability, limits of 54; modelling 64; risk 76; securitisation 54, 56, 58, 60, 61; sex as actuarial factor 90 adverse selection 46, 47, 92; see also risk algorithm 48, 49, 71n Althusser, L. 31 Amoore, Louise 118 Anderson, Greg 121 Augar, Philip 78, 82 Bacchi, Carol 122 Bachelard, Gaston 31 Bain, Read 133 Barry, Dean 72 Bayatrizi, Z. 99–100 Beck, Ulrich 54 Becker, Gary 96 Behrent, Michael C. 133–4 Bergson, Henri Louis 26, 29 bicycle, metaphor of 26–7, 51 biopolitics 35, 36–41, 48–9, 50, 96; The Birth of Biopolitics 96–7; life insurance as biopolitical security technology 117 Blumenberg, Hans 25, 70 book cover xv, 1 Booth, Stephen 93–4 Bougen, P.D. 57 Brockett, P.L. 66 Canguilhem, Georges 31, 114 capable life: as aging course 20, 122, 125–8, 135; as capital 20, 122, 128–31; capable life, moral economies and

liberal political communities 122, 131–3; capable life vs potential life 9–10, 19; definition 9, 49–50, 116; dwelling based on 13; enabling capability 10; excessive capability vs decisive potentiality 49–53; insufficiency of sense in the insurance of 119, 120; insurance of capability and the accounting of life 118, 120; insurance of capability and evental form of politics 118–19, 120; as object of insurance 116, 117; politics of capability 50, 51, 118–20, 123; a technological effect 20, 119, 120, 122, 133–5; valuation of life 9, 119 capital 4, 5, 111; capable life as capital 20, 122, 128–31; human capital 96–7, 129; life as capital 4, 43, 116, 129–30, 132, 135 capital accumulation 5, 7, 97, 111, 130; credit 13, 15 capitalism 26, 75, 116; capitalist life 5, 7; liberalism 4, 11, 26, 75, 111 certainty 11, 111, 124 Chaufton, Albert 43 Chicago School 96 Christianity 5, 14, 25, 76, 125 Clark, Geoffrey W. 121 classification 106, 125; classification of life 113, 114–15; gender issues 19, 131 Code 46: 19, 35, 36, 119; aesthetic regime of the arts 41, 53; biopolitics 35, 36–41, 48–9, 50; capable life vs potential life 19, 51; Cottrell Boyce, Frank 35; liberal governance 112, 115; plot 36–41, 112; resistance to life’s valuation 47–9; risk 39, 45–6; see also Winterbottom, Michael Connolly, William E. 25

Index constructivism 22, 54, 71 credit 25; capital accumulation 13, 15; denial of 15; life insurance 5, 8, 75, 76, 89, 116, 122, 130 Daston, Lorraine 30, 31, 42, 65–6, 131–2 Davis, Kathleen 117 death 4, 121; fear of 42; mortality risk 59, 104, 105; premature death 5, 6, 7, 42, 116, 127, 130 Deleuze, Gilles xv, 13, 105, 106 Dillon, Michael 111, 118 Dodson, James 116 Doyle, Aaron 72 dwelling 11, 12; hypothecated home 11, 12; liberal dwelling 11–13, 15, 85, 86, 87; see also livelihood and lifestyle EBM (Evidence Based Medicine) 94, 104–105 EBR (Evidence Based Rating) 94, 104–105 ECJ (European Court of Justice) 19, 90, 91, 92, 93, 103, 107; 2011 ECJ ruling 89, 90–2, 102, 131; reactions to the ECJ ruling 92–4; see also sex as underwriting category empiricism 75, 122 epistemology see historical epistemology; life insurance, epistemology of Ericson, Richard 72 ethics 30, 76 EU (European Union) 97; European Commission 90–1, 95, 97, 99; welfarism 97 event 32–3, 126; actuarial science/practice 64; capable life 9, 118; event as risk and value 43, 57, 73, 127, 132; insurance of capability and evental form of politics 118–19, 120; liberal life, imagination and formulation of future events 87; potential life 9, 117; prognosis of 6, 45, 48; strategisation of multiple temporalities 63, 71, 128; transforming life stages into insurable events 127–8; Vita and Kortis 63, 66–7; see also risk; uncertainty Ewald, François 43, 76, 133 expectation 9, 111, 124, 126; horizon of expectation 123, 124, 128, 132; liberal expectation 11, 132; liberal governance and setting expectations 111–12; security of expectation 6, 46, 113, 125; uberrima fides 75, 82

151

fear 35, 41–3, 85, 121; fear of death 42; life insurance and profit from 42; uncertainty and 20, 42, 85, 122–5, 135 Fleck, Ludwig 31 Foucault, Michel 13, 29, 83–4, 113–14; The Birth of Biopolitics 96–7; governmentality 33, 46; historical epistemology 31–3; knowing oneself 81; The Order of Things 88–9, 118; regimes of veridiction 17, 97, 114, 122, 130; sexuality, genealogy on 100; strategisation 56; technologies of the self 73, 81, 83, 84, 133–4; temporality 16; uncertainty 123 Fries, J. 62 Fukuyama, Francis 21, 24, 28 gender issues: behaviourism 101; classification 19, 131; European Commission 99; Foucault, Michel 100; gender discrimination 94, 95, 99, 103, 131; gender equality 90–1, 96, 97–9, 102; gender as risk indicator 92; gendering 101–102; inter-sexuality 99; neoliberalism 97–8, 107; sex/gender distinction 95, 98, 99–101, 107, 131; see also sex as underwriting category globalisation 21, 28 Gomez, Carlos xv Goodchild, Philip 25 Gordon, S. 64 governance: alternative forms of 24, 120; economy as an order of governance 128–9; governance of knowledge 131–2; insurance as technology of governance 5, 16, 29, 119, 134; interest as a principle for governance 21–3; technological governance 11; see also liberal governance Granovetter, Mark 81, 84 Grotius 77 Guattari, Felix xv Hacking, Ian 66, 125 Hardt, Michael 25 Hasson, Reuben 77 health insurance 18, 45, 54, 55, 62, 90, 94 Heidegger, Martin 12, 28, 30, 33–4 Heward, E. 74 Hirschman, Albert O. 22 historical epistemology xv, 19, 27, 30–4 Hume, David 77, 105

152

Index

infirmity 6, 62, 127 insurability: insurability as a problem of governing uncertainty 54, 55; knowledge discourses and practices of truth-making 55; limits of 54–7, 71; a paradox 10, 49 insurance 13, 18, 75, 121; capitalism 75; creating a liberal order 121–2; an instrument of liberal governance 4, 113, 126; an intersection of economic and political projects 125–6; manufacturing security and profiting from it 13; modern legitimacy 4; a technology of governance 5, 16, 29, 119, 134; see also insurantial logic; life insurance insurance policy 18, 43, 46, 114, 130 insurantial logic 5–7; legitimacy of knowledge 6–7; liberal governance 11; prognosis 6; transforming uncertainty into risk 5–6, 18; valuation of life 8 Jakhria, P. 64, 70 Jarvis, S. 64, 70 Kant, Immanuel 25, 31, 46, 72, 77 knowledge: evidence-based knowledge 45, 95, 103, 104, 105–106; governance of knowledge 131–2; knowing oneself 81; knowledge discourses and practices of truth-making 55; knowledge/ power relationship 32, 81; legitimacy of 6; liberalism 28; populations and 125; probability as knowledge 6–7, 103; reflexive knowledge 88, 89, 105, 106, 118; uberrima fides 75–6 Koselleck, Reinhart 56, 63, 117, 123–4, 128 Kristol, Irving 23 Lecourt, Dominique 31 liberal governance 20, 24, 27, 30, 52, 111–12; challenge and resistance to 115, 120; classification and commodification of life 115; Code 46: 112, 115; crisis of 24, 26, 28; insurance as instrument of liberal governance 4, 113, 126; insurantial logic 11; misselling insurance products, a problem of liberal governance 74, 84; neoliberal governance 25; regulatory practices of states 84, 86–7; setting expectations 111; technology 119, 120; transcendence of 118–20; trust 113; see also governance; liberalism; transcendence of liberalism

liberal life 20, 85, 111; classification and commodification of life 113–15; contracted life 86–7; dwelling and homing, 11–13; life as capital 43, 116, 129–30, 132, 135; life insurance as signifier of liberal life 11; making sense of uncertainty as principle of 10, 111; transcendence of liberalism 20, 87; see also dwelling; life; livelihood and lifestyle liberalism 21, 23–4, 135; capitalism 4, 11, 26, 75, 111; curiousness of 27–8; ethics of 30; liberal expectation 11, 132; liberal state 23–4, 97; uncertainty 123; unusualness of 27–8, 29; value, creation of 26, 27, 28, 43, 112; value of life 8; Western liberal democracy 21; see also liberal governance; transcendence of liberalism life 17–18; capitalist life 5, 7; classification and commodification of life 113, 114–15; life as capital 4, 43, 116, 129–30, 132, 135; life course 127; life excess 44; transcendence of liberalism 4; see also capable life; liberal life; life insurance; potential life; valuation of life life insurance: a 2.65 trillion USD industry 41; credit 5, 8, 75, 76, 89, 116, 122, 130; definition 41–2; emergence and development of 116; a financial instrument 5, 41; life as capital 43, 116; life insurance and the transcendence of liberal governance 118–20, 135; logic of 5; performing a security 9; signifier of liberal sense 10, 11; value of life 8, 43, 116; see also insurance; life insurance, epistemology of; life insurance as technology life insurance, epistemology of 121–35; capable life as an aging course 122, 125–8; capable life as capital 122, 128–31; capable life, moral economies and liberal political communities 122, 131–3; capable life as technological effect 122, 133–5; population as epistemic object 125–6, 134; transcendence and life insurance as epistemology 135; uncertainty and the problematisation of fear 122–5; see also life insurance; life insurance as technology life insurance as technology 124, 129, 133; a biopolitical security technology 117; capable life as technological effect

Index

153

20, 119, 120, 122, 133–5; life insurance and the transcendence of liberal governance 118; probability 118; a technology for the creation of liberal governance 11, 24, 26, 52, 129; a technology for the creation of liberal subjects 29; a technology for the creation of value 8, 127; see also life insurance; life insurance, epistemology of; technology livelihood and lifestyle 7, 10, 12, 17, 45, 46, 126, 129; changes in livelihoods 85–6; including/excluding cover for some lifestyles 44, 47; life insurance 41–2, 106; see also dwelling; liberal life Lobo-Guerrero, Luis 5, 8, 18, 111; Insuring Security 9, 18, 116, 132; Insuring War 18, 132 Locke, John 77 Löwith, Karl 25 Luhmann, Niklas 6

moral hazard 15, 46–7, 51, 72, 73, 85; mis-selling insurance products (UK) 74, 84 Morgan, M. 64, 65 Morgenthau, Hans J. 21

Mansfield, Lord 72, 73, 74, 75–6, 77; Carter v Boehm 72, 75, 77; see also uberrima fides Medieval Renaissance 5, 132 metrics 118 Milliman Ltd. 59, 60, 61, 66 mis-selling insurance products (UK) 48, 77–81, 82–3, 86; ABI 80; deceit 82; Financial Services Authority 79, 80–1, 82, 83, 84; insurance scandal 79; MEP 79; moral hazard 74, 84; PPI 79, 80–1, 83; a problem of liberal governance 74, 84; trust 74, 79, 83; uberrima fides 19, 72, 74; see also trust; uberrima fides modelling 50, 64–6, 103; actuarial science/practice 64; precision/accuracy distinction 66; a pseudo-scientific basis for the prognostication of futures 70; RMS 68–9; term time 69; time, strategisation of 66–9, 128; transforming uncertainty into risk 71; Vita and Kortis 59–61, 63, 65, 66–9 Money, John 100–101 Monte Carlo simulations 60, 71n moral economy 53, 86, 131; capable life, moral economies and liberal political communities 122, 131–3; constituted through creation of capable lives 20, 50; contracted life 86–7; definition 43– 4, 132; liberal life 87; valuation as the basis for moral economies 44, 46

parametric insurance 57, 59 political theory 19, 25, 77 post-structuralism 44 potential life: capable life vs potential life 9–10, 19; definition 9, 12, 51, 116; dwelling based on 13; excessive capability vs decisive potentiality 49–53; insurance of potential as impossible 20; life insurance’s violence on life as potential 117; outside the realm of controllability 9–10; politics of potentiality 51, 123; security of 117; synchrony as the time of 117 power: classification as an exercise of 106; exercising the power to evaluate 9, 106; knowledge/power relationship 32, 81; power relations 33, 122; power relations and truth 73, 81, 82; technology/power relationship 134; trust as outcome of power relations 73, 81, 84, 113 PricewaterhouseCoopers 57–8 private insurance 45, 72, 94, 102–103 probability 6, 45, 114, 118, 121, 124; as knowledge 6–7, 103; uncertainty 54, 75 prognosis 6, 45, 48, 70, 124

Nabholz, C. 94–5, 102–105 Nancy, Jean-Luc 8, 9, 12, 88, 116, 117; politics of aesthetics 13; value 106–107 Nasim, Omar 31 Negri, Antonio 25 neoconservatism 23 neoliberalism 25, 96–8, 107 Nietzsche, Fredrich 13, 30, 31–2, 88, 117, 122, 124 Nukak Makú group, 19–20, 108–109, 119; governmental protection of 110; guerrilla, 108, 110; kinship 109, 113; life in the jungle/liberal life comparison 111–16; nightmare for farmers 108, 109–10; trust 113

Ramey, Joshua 25 Rancière, Jacques 13, 41 rational choice theory 22 realism 21

154

Index

Repo, Jemima 96, 97–8, 100–101 Rey, Abel 31 Rheinberger, Hans-Jörg 31, 126 risk 7, 18, 76; actuarial science 76; assessment of 7–8, 126; catastrophic risk 57, 71; Code 46: 39, 45–6; gender as risk indicator 92; high risk activities 47; mortality risk 59, 104, 105; pooling 93, 95, 103–104, 126–7; ratings 104–105; risk premium 104; riskwarehousing model 56, 58; securitisation, a risk mitigation strategy 57, 58; substandard risk 104; transforming uncertainty into risk 5–6, 10, 18, 54, 71, 76, 121, 125, 133; value and 43; see also adverse selection; event; uncertainty; underwriting; uninsured life RMS (Risk Management Solutions) 61, 63, 67–9 Rose, Nikolas 43, 96, 134 Sawicki, Jana 134 Schmitt, Carl 107 secularism 8, 14, 25, 46 securitisation: actuarial practice 54, 56, 58, 60, 61; life insurance securitisation 57–8; multiple temporalities 56; see also time, strategisation of; Vita and Kortis security: economies of security 42–3, 46, 49; insurance: manufacturing security and profiting from it 9, 13; liberal governance and the production of markets of security 13, 16, 17–18, 84, 85–6, 87, 114, 128; uncertainty 42–3, 123 Seligman, Adam B. 77 sex as underwriting category 19, 99–101, 115, 131; 2011 ECJ ruling 89, 90–2, 102; EC Gender Directive 95–6, 98, 102; European Commission 90–1, 95; European Council and equal treatment between men and women 90–1; evidence-based-underwriting 94, 95, 103, 104–105, 107; forbidding the use of sex as underwriting category 19, 89, 95, 115; insurers’ ‘right to underwrite’ 90–5, 103, 105–106; private insurance 102–103; reactions to the ECJ ruling 92–4; sex as actuarial factor 90; Swiss Re 94–5, 102–105; UK 92–3; valuation of life 19, 89, 95–106, 107;

valuation of life and underwriting 93, 106; see also ECJ; gender issues Shapiro, Michael 41, Shapiro, Susan 81–2, 83, 84 social insurance 102 Somerville, K. 94–5, 102–105 space tourism 47, 53 state: liberal state 23–4, 97; national interest 21–3; regulatory practices of 84, 86–7 Swiss Re 94–5, 102–105; 2007 Life risk selection at a fair price 94; 2011 Fair risk assessment in life & health insurance 94; see also Vita and Kortis technology 29–30; classification as technological practice 106; definition 133, 134; epistemic/technical object distinction 126; Foucault’s technologies of the self 73, 81, 83, 84, 133–4; insurance as technology of governance 5, 16, 29, 119, 134; liberal technologies of governance 135; technological governance 11; technological ontology 118, 135; technological transcendence of liberalism 135; technology/power relationship 134; transcendence of liberal governance and 26, 120; transforming uncertainty into risk as technological practice 133; see also life insurance as technology Thaleb, N.N. 66 Thatcher, Margaret 78, 82 Thompson, E.P. 53, 131 Thrift, Nigel 35 time/temporality: insurance, present time in perpetual present 5, 70; liberal governance and the production of temporalities 13, 16–17, 112, 125, 128; multiple temporalities 56; synchrony as the time of potential life 117; time of the liberal 4; transcendence of liberalism: a continuous present 26–7; transforming uncertainty into risk 5, 71; see also time, strategisation of time, strategisation of 56, 63–9, 71; chronologic logic 56, 63, 66, 67, 68; diachronic logic 56, 63, 66–7, 68; insurability, limits of 71; Kortis bonds 68; modelling 66–9, 128; strategisation of multiple temporalities 63, 128; synchronic logic 56, 63, 67, 68; term time 56, 63, 66, 70, 71; Vita Capital series

Index 66–8; see also time/temporality; Vita and Kortis transcend, definition 13, 24–5 transcendence of liberalism 13–18, 27–30, 120, 135; capitalism 4, 26; concept, 25–6; liberal life 20, 87; liberal subject, production of 23, 26, 27, 29, 30; producing liberal subjectivities and truth 13–16, 84–5, 87, 125, 127–8; producing markets of security 13, 16, 17–18, 84, 85–6, 87, 114, 128; producing temporalities 13, 16–17, 112, 125, 128; remaining in control 52; technological transcendence of liberalism 135; temporality: a continuous present 26–7; transcendence of liberal governance 118–20; see also liberal governance; liberalism trust 19; good faith 73, 84; liberal governance 113; mis-selling insurance products (UK) 74, 79, 83; moral hazard 85; an outcome of power relations 73, 81, 84, 113; a precondition for insurance relationship 73; production of economies of trust 83–7; promise-keeping 77, 81; public trust 77, 82, 83; as signifier of truth 19, 72, 73, 81–3, 84, 130; a value for liberal life 113; see also mis-selling insurance products (UK); truth; uberrima fides truth 14–15, 124; being truthful 15; experiences of 33; Foucault’s regimes of veridiction 17, 97, 114, 122, 130; knowledge discourses and practices of truth-making 55; market as site of veridiction 18; power relations and 73, 81, 82; public truth 14; trust as signifier of truth 19, 72, 73, 81–3, 84, 130; truth production 81, 113, 130–1; see also trust uberrima fides 72; definition 72, 73, 74, 75; expectation 75, 82; fraud 75–6, 77; in insurance relations 75–6; knowledge 75–6; mis-selling insurance products (UK) 19, 72, 74; origins of the doctrine 74; trust 72; United States 77; see also Mansfield, Lord; mis-selling insurance products (UK); trust uncertainty 5, 35, 50, 123, 124; assurance in the face of 9; a correlate of discourses and practices of truth 55; double meaning of 51; economies of security 42–3; fear and 20, 42, 85,

155

122–5, 135; insurability as a problem of governing uncertainty 54, 55; knowledge discourses and practices of truth-making 55; making sense of uncertainty as a principle of liberal life 10, 111; probability 54, 75; transforming uncertainty into risk 5–6, 10, 18, 54, 71, 76, 121, 125, 133; see also event; risk underwriting 18, 104; right to underwrite 105; specialist underwriting 53n; underwriter 72, 75–6, 94, 104, 105; see also risk; sex as underwriting category uninsured life 9, 49, 115, 127; uninsurable life 46, 50, 87, 104; see also risk usury 5, 76 value 8, 26, 106–107, 135; absolute value 8; insufficiency of value 8, 116–17, 119; liberal creation/protection of 26, 27, 28, 43, 112; life insurance as technology for the creation of 8, 127; relational character of 8–9; risk and 43; see also valuation; valuation of life valuation 18, 106–107; exercising the power to evaluate 9, 106; see also value; valuation of life valuation of life 8, 26, 43; 1774 Gambling Act, Britain 89; assessment/event/ object of protection relationality 6; capability 9, 119; insurantial logic 8; resistance to life’s valuation 47–9, 116; sex as underwriting category and 19, 89, 95–106, 107; underwriting 93, 106; valuation as the basis for moral economies 44, 46; valuation as a practice of inclusion 44–5; valuation as vital ontology 44, 45–6; see also value; valuation Veyne, Paul 13–14, 16, 29, 88, 123 Vidal, Fernando 30 Vita and Kortis 54, 55–6, 59–63, 71; longevity bonds 61–3, 68; Kortis Capital 62; modelling 59–61, 63, 65, 66–9; parametric insurance 59; securitisation of excess mortality 59–60, 66–8; securitisation of excess vitality 61–3, 68, 127–8; Vita Capital Ltd. 59; Vita Capital series 59, 61, 66–8; see also securitisation; time, strategisation of; Swiss Re Waldby, Cathy 43 Washington, George 21–2

156

Index

Williams, Michael C. 23 Winsberg, E. 64–5

Winterbottom, Michael 19, 35, 36–41; see also Code 46 Wyman, Oliver 78, 79, 80, 81