There are many ways in which insurance is a lot like a wager. Take auto insurance for example. With car insurance you’re really having a bet between two parties. On one hand, you have the driver and the subscriber; this person, really is already betting, even without buying a policy. He’s betting that he won’t get into an accident. He’s hoping he won’t get into an accident anyway. But he’s going to take out a policy on his driving, just in case; he’s basically going to hedge about his driving, just in case. And if you feels particularly vulnerable one year, he can take out a bigger policy, a more equipped policy that year, betting in essence that he’ll get into an accident, and instead of waiting for that to happen, he’s going to avail of the discount he’ll get by putting the money up front, in the way of a premium.