5 ms·
> Insurance firms sometimes cover extremely “long-tail” risks, such as alien abduction insurance. That's not what "long tail" means in insurance. It does not m
by phonon 7y ago
> Insurance firms sometimes cover extremely “long-tail” risks, such as alien abduction insurance.
That's not what "long tail" means in insurance. It does not mean unlikely, it means the claim might need to be paid out years after the period coverage was paid for. (Think current lawsuits about asbestos exposure from the 1970s).
https://www.investopedia.com/terms/l/longtail-liability.asp https://www.investopedia.com/terms/l/longtail-liability.asp
- devnulloverflow 7y agoWell, maybe the aliens will keep returning to earth and at unpredictable intervals demanding money in exchange for keeping the hostage alive.
- nradov 7y agoThe alien abduction insurance was clearly described as a gag gift.
- phonon 7y agoThat's a secondary issue (the writer (CEO?) tried to give an example of a insurance policy that covers a very remote event). So fine, doubly nonsensical. I would have also done a separate article separating paying premiums to the carrier from the carrier paying out claims. Those are basically two totally different parts of the insurance company, with different systems (usually) and definitely from different bank accounts.