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If a bunch of banks go under at once, or even one big bank with a sufficient number of claims, who's to say the insurers will even be able to pay out on that?
by flatline 11y ago
If a bunch of banks go under at once, or even one big bank with a sufficient number of claims, who's to say the insurers will even be able to pay out on that? Nonetheless, I always find this type of apocalyptic thinking to be humorous - why do people think that their cash will be worth anything if the financial system collapses? Another motivation would be if you are concerned about having your assets frozen.
- Symbiote 11y agoThe central bank pays. As an example, in the UK personal deposits of a failed bank are guaranteed by the Bank of England up to £75,000. The Bank of England can always cover the amount, since they can simply print money as needed. http://www.fscs.org.uk/what-we-cover/products/banks-building-societies/ http://www.fscs.org.uk/what-we-cover/products/banks-building...
- lagadu 11y agoIt's not insurers who pay it's the central bank. It has control over the currency itself; because of that it can (and has to) always pay. > Another motivation would be if you are concerned about having your assets frozen. I'm with you on that one.