The insurance premium is one aspect -- the other is capacity. I am not saying that you couldn't get $60m of coverage, but there has been drastic changes in the insurance and more importantly reinsurance marketplace.
I don't count other people's money, literally speaking, and there is an irony there considering I am in the financial business and exclusively work with wealthy people, high-net-worth/income, etc. However, if you have a horse that you would like to insure for $60m and the cost to insure him is $3m -- that might be a true "out of pocket" as the horse may not have earned $3m. I am not defending those who own the horses or critisizing them for that matter. You want to play you have to pay. That's the price of admission.
There is an economic side to this. People make financial decisions for two reasons -- economics and emotions.
Eric
|