And just as the financial risk of a fire can be insured, so too can risk to the human body.
If banks were regulated by the market, with deposits privately insured like any other risk, there would be no need for the FDIC.
Of course, as with nearly any investment that isn't federally insured, there's a risk involved.
The Government Accountability Office has also cast doubt on a proposal--supported by Democrats and the administration--to lower the down payment requirement for FHA-insured loans, given the greater default risk on those loans.
Anything can be insured for the right price, and the risk of people or property being held for ransom is no exception.
Absent intervention, well-functioning insurance markets achieve actuarial fairness in which premiums are in direct proportion to the risk posed by each class of insured individual.
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If you wanted an investment that paid a return at virtually zero risk, you would buy an insured bank CD or put your money in a savings account.
On the one hand, this split separates the toxic assets, whose value is very uncertain, in an institution that has no insured or guaranteed liabilities and poses no systemic risk.
The new rules at issue apply only to fully insured health plans and not those where the employer absorbs the risk and directly pays out medical claims.
The firm will move its 40 U.S.-based workers to a self-insured plan in June, in part to avoid the health law's risk-spreading provisions that could raise its costs, said CEO Randy Keith.
The theory behind Glass-Steagall (and GS-lite measures like the Volcker Rule and the swaps pushout provision of Dodd-Frank) is that banks with insured deposits are subject to moral hazard, and will take on too much risk.
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Most companies will not say whether they are insured, because doing so could invalidate their policies and put their employees at greater risk of being grabbed by kidnappers hoping for multimillion dollar paydays.
Economists at Citigroup reckon that a fund ought to start with a baseline of 2% of insured deposits, and then top up that amount with an additional premium to reflect the risk that peripheral countries may leave the euro and that their currencies would then depreciate.
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