I think blackmailing someone in the closet is almost always wrong -- I'm sure there's some contrived edge case that could be thought of, but as a whole, it's never okay.
Just because most / all intelligence agencies do something doesn't mean it's okay. It's unambiguously wrong.
A theme of this article is to say that you are reachable from the metaphorical armchair of your residence. And if you are gay, you are within reach. If you have a reason for insurance companies to cut you off, then that is the smell of of leverage.
Israeli intelligence is working around the clock to disrupt the actions of terrorist groups like Hezbollah and Hamas. There are countless terror factions who's sole purpose is to destroy Israel and execute a second Holocaust. You don't hear about the terror plans which were foiled. You don't have sympathy for Israel because they are winning.
No, they also work for money and would snitch on friends to make money. It’s not like other secret services don’t have similar patterns but they’re unequivocally bad. What comes to mind is Saudi Arabia dissidents info sold for money, iphone security broken, lives destroyed or severed completely and solely for money.
This will backfire as more and more friends turn away and become suspcious of what Israel allows to happen
There is no moral high-ground for Israel. They are the colonizing force and they're committing war crimes and illegal annexing of Palestinian land. They're also blackmailing people for being gay as per the article.
[1]: https://en.wikipedia.org/wiki/Asset_(intelligence)