3 ms·
Isn’t the point of insurance to provide protection against black swan events? If it’s more likely to happen then it’s not really a black swan?
by jameslk 1y ago
Isn’t the point of insurance to provide protection against black swan events? If it’s more likely to happen then it’s not really a black swan?
- lazide 1y agoNo [https://en.m.wikipedia.org/wiki/Black_swan_theory https://en.m.wikipedia.org/wiki/Black_swan_theory]. It’s the difference between getting cancer (calculable, but perhaps not high probability), and getting hit by a meteorite (not actually calculable, very severe consequence).
- adgjlsfhk1 1y agoinsurance is best for individually unlikely but societally likely items. otherwise pricing it is really hard.
- hdgvhicv 1y agoFire burns your house down, insurance is easy. Asteroid hits New York, insurance won’t pay out.
- lazide 1y agoOr in many of these scenarios, can’t pay out, because they’re bankrupt. The biggest issue with black swan events (in the proper usage) is everyone is screwed because no one saw it coming and/or it’s so widespread no one can do anything about it for individuals.