The basics of insurance
2 mins
Picture the scene: it’s 2001, you’re the CEO of Taco Bell, and it’s been reported that a space station is about to crash into the South Pacific. So you make the (totally obvious and totally normal) decision to stick a Bell-branded target in the ocean, and you tell the world that if the space station hits that target, you’ll give every American citizen a free taco 🌮
Now, it’s very unlikely the station will hit the target, but it is theoretically possible. And if it does, you’re going to have to deliver on your promise to the tune of a cool $400 million. That’s a possibility you’re probably not comfortable with – but that promotion sure sounds like a good way to put tacos on the map. So you decide to take out insurance. Taco insurance.
You do it because you know that, in exchange for a
Limited introductory offer
Get full access to daily stories, insights, deep-dives, interviews, podcasts, and more
Have an account? Log in
EXPLORE MORE
Big Tech kept downsizing, with Amazon nixing another 9,000 jobs
JPMorgan’s leading the charge to save First Republic Bank – but not out of pure generosity
With all this volatility, you may want to write that useful old adage down.