The idea is that what you pay goes to a fund that is used when the insurer has to pay a client, therefore socialising the costs of fixing whatever the clients insured.

If every client could get their money back, the company would likely have less money available for the payouts (and would risk everyone taking their money out once a big payout is due), and might go bankrupt if too many payouts come up at once.

So instead the idea is that ideally you end up paying less than you'd get if you needed to fix whatever you're insured for... but it's like a bet: you bet that shit'll happen before you've paid more, the insurer bets that it won't.

Of course, though, like in all businesses based on gambling the house always wins.

Even if they weren't scamming you, they've got actuarial tables telling them how much you have to pay to make sure they'll have a certain amount of profit... but of course they are scamming you, and they'll do everything possible to avoid paying you even in the unlikely event that you fall on the wrong side of the actuarial table.