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In other words, someone who insured such bonds against default would have, on average, made money (conventional insurance companies, which insure against fire or theft, have not always done so well).The third quirk of credit derivatives is that they allow corporate bonds to be sliced and diced on the basis of risk.
This means that much of the burden of bankruptcy will have to fall on those who lent Detroit money, and those who insured those lenders.
Some will go to those who insured the value of securities, like Ambac Financial, which surprised Wall Street by posting its first quarterly loss this week.
I can hardly imagine that the Sun Alliance Company who insured the building will agree with that statement, but even they have an impressive hoarding to greet visitors as they arrive ("Destroyed! but Insured with Sun Alliance").
The person who insured others against an unlikely event faced not only the problem of judging its likelihood; even if he knew how often it would occur, he didn't know when it would occur.
"A lot of people are using this method, mostly with shopping centers and office buildings," said Mr. Tschanz, who insured the purchase and mortgage on the 250,000-square-foot independence Plaza Seldenng center in Selast year year.
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If you live in a state that doesn't, know that many of the insurance companies who insure these activities do have strict guidelines.
That was a disaster when the insured loss for 9-11 approached $40bn, with most of it paid by insurance companies and the firms who insure them, known as reinsurers.
"Who insures you doesn't matter," reads the copy.
Perhaps there exists an alternate universe of men who insure their survival in equally fraught ways.
She believes the problem could affect hit a lot of pet owners who insure with NatWest.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com