> As an insurance should I insure a house for $1000? Again probability cannot help when an earthquake demolishes the entire state and I have to write a check fo

> As an insurance should I insure a house for $1000? Again probability cannot help when an earthquake demolishes the entire state and I have to write a check for every damn house I Insure. I actually need to keep in the bank amount equal to the price of each house Not really, no. Actuarial tables can be quite amazing when they're accurately applied. All you need to do is structure the policy so that it is unlikely to pay out in such a situation, or has a limited payout. That's easy to do: you just make a list of exclusions such as "Acts of God" or war, or terrorism, etc. So basically, any instance of mass destruction will fail the coverage and you pay out $0.