> Someone did a better job of estimating odds than an insurance company did. They then defrauded the insurance company

how come it's not fraud when insurance companies calculate the odds better than you, and yet it is fraud when you do it to the insurance companies?

Because you're not buying it to win money. You're buying it to limit downside loss, because aside from the massively wealthy, we are loss averse. It's worth our while to pay $200 to insure against a 1% chance of losing $10000, even though in purely probabilistic terms that's a bad deal, because most people can't afford an unexpected expense that large. Even people who can afford that, it's still more painful to lose it than to have a 99% chance of having wasted $100. The larger the potential downside, the bigger the incentive to insure against it, even when it's a bad deal.

> Because you're not buying it to win money.

There is no win or lose, if insurance is not gambling. If it is, then either side wins money with varying payout schedules.

It's not. It's fraud when you lie about it.

> Someone did a better job of estimating odds than an insurance company did.

Eh, I'm not sure that's really true, even.

Flight insurance -- at least, all of the flight insurance I'm familiar with -- is a fixed-cost product. I doubt it is so much that the insurance company couldn't create separate risk pools, from their own analysis, but that it doesn't make sense as a business.