Say a bike does get stolen, then you'd need to contact the police, but maybe the police are busy and don't actually care, that's the pain point that I see, maybe its a baseless concern.
As far as I know, it's far from a baseless concern. Paris, for example, lost 9000 bikes just in a year. Relying on the police seems folly, they probably just have to make a good estimate and price-in the replacements into their business model.