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by rdl 4355 days ago
I wonder how much an insurance policy to cover this risk for Flytenow would cost them.
1 comments

It probably can't be bought. Most insurance relies on there being some kind of probabilities associated with different outcomes, and that the insurer can sell enough policies such that they capture the law of large numbers and the idea of an expected outcome is valid.

http://en.wikipedia.org/wiki/Law_of_large_numbers

http://en.wikipedia.org/wiki/Expected_value

If Flytenow wants to cover this, they're going to be self-insuring and the policy is only good as far as the company has cash or credit to pay legal bills.

I guess it would be hard to underwrite something which is essentially a legal opinion, but there are underwriters who will do weird one-offs. Generally it's based on being able to reduce it to well-known probabilities, though.