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I don't see the benefit to a major retailer chain to even buy insurance. Are we sure they do? Insurers would simply look at Walgreens' specific loss amount and

I don't see the benefit to a major retailer chain to even buy insurance. Are we sure they do? Insurers would simply look at Walgreens' specific loss amount and charge them that same number plus overhead and profit.

monocasa 5y ago
In Silicon Valley speak: RAaaS - Risk Aversion as a Service. Most retail runs on pretty thin margins so simultaneous robberies means a low quarter which means someone's head on a platter at corporate. It's a wash on the day to day, and the insurance comes out ahead on a big robbery because of the premiums, but the corporate keeps it's numbers versus the previous year. It's mainly an accounting hack with little value to negative value for the company as a whole after your company reaches a certain size, I agree. There is the classic idea insurance idea that because retail runs on thin margins, keeping the money flowing is important so the whole house of cards doesn't fall down from a huge decrease at an inopportune time, but the relationship stays around way longer than is necessary because of the social organizational effects above, IMO.