Quote:
Originally Posted by Cynthetiq
Unlike a casino where they must have enough cash to cover all the chips that are out on the floor in case they are all cashed in at the same time, it appears to me that Insurance doesn't operate like that.
From what I understand there is a risk that a percentage of claims will be made and that never or rarely will the risk equal the entire holdings of the company.
Is that a correct assesment?
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Ya, I suppose it sounds that way. It seems like a business enterprise like this should be allowed to fail rather than have tax payers bail them out. Also this reminds me of franctional reserve banking
