Why insurable risk is necessary in life insurance?

Insurable risk is essential in life insurance because it ensures that risks can be quantified and priced accurately, allowing insurers to offer policies that are financially viable. Life insurance relies on the pooling of risks from many policyholders, where the premiums collected from healthy individuals help cover the claims of those who pass away. This system only works if the risks are predictable and statistically manageable, which is why insurable risks, characterized by randomness and a large number of similar exposures, are necessary for the sustainability of life insurance products. Without insurable risks, insurers would face uncertainty and potential financial instability.