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Insurance and reinsurance just clip the tail contractually, they never take "infinity multiplied by some small percent" risk! They don't go underground when the
by juskrey 7y ago
Insurance and reinsurance just clip the tail contractually, they never take "infinity multiplied by some small percent" risk! They don't go underground when their client does.
- Chris2048 7y ago> they never take "infinity multiplied by some small percent" risk At what point does the tail represent "all humanity dead"? No one needs a contract for the humanly unrecoverable.
- juskrey 7y agoWe are talking about business death
- Chris2048 7y agothen the tail ends even before then, but that doesn't mean insurance companies don't pay out billions in case of an economic crash.
- juskrey 7y agoSorry, I barely understand, what insurance against economic crashes?
- Chris2048 7y agoI didn't mention "insurance against economic crashes" - there is a crash, and this has the effect of lots of payouts. Some event may cause an economic crash, companies can have insurance against business disruption. If an event suddenly causes a lot of insured business disruption, that might mean a large total payout.
- harperlee 7y agoThey are typically exempt in case of natural disasters, war, force majeur, nuclear effects, and a well-thought-out plethora of tail risk events.