Uninsurable Risk

Uninsurable Risk

A risk against which one cannot purchase insurance, either because it is very likely to occur or because it would be too expensive to cover if it did. For example, a 118-year-old person may be an uninsurable risk for life insurance because the person is very likely to die before the insurer collects a sufficient amount in premiums. Likewise, one generally cannot insure against nuclear war because, even though nuclear war is unlikely, repairs and medical bills would be prohibitively expensive.
References in periodicals archive ?
Historically, flood has been thought of as an uninsurable risk, and your only option as a homeowner or a renter has been to purchase coverage through the National Flood Insurance Program (NFIP).
After an initial insurance package is executed, multinational corporations will have the opportunity to address uninsurable risk factors by incorporating a strategy that better engages the specific population into their operations.
This bespoke solution was designed to cover this traditionally uninsurable risk, which Roy Hill identified as a particular concern.
The price for not taking a highly aggressive loss-prevention approach to this largely uninsurable risk can have life-changing consequences for directors and executives, and can be costly for organizations, both financially and in the court of public opinion.
After 9/11, there was a slowdown in commercial building because terrorism is an uninsurable risk.
Now I have long thought that there is no such thing as an uninsurable risk and I guess this would have been true in Llandudno had the club been prepared to pay an enormous sum.
Their findings suggest that, in general, when households face uninsurable risk in the returns to their human or physical capital, it is useful to tax the income from these factors and then rebate the proceeds via a lump-sum rebate.
For example, losses from terrorist attacks through nuclear, chemical, biological and radiation devices would be mostly covered by the government because it is an uninsurable risk.
It is this hands-on approach that has caused Sitomer to be sought by developers, lending institutions, construction and design professionals and the real estate brokerage community to help design programs that address this soon-to-be uninsurable risk.
Terrorism is an uninsurable risk that cries out for federal action and without it there could be catastrophic ramifications, he warned.
Terrorism for us became an uninsurable risk for the same reason that war is excluded," says SAFECO's McGavick.
This article examines the design of an optimal policy for an insurable risk in the presence of another uninsurable risk.