Gaming and Lottery Prize Insurance 2021
Lottery Insurance and Jackpot Coverage
You tell us which state lotteries you want to offer, define the jackpots and send us all your entries in time before the draw of the official state lottery takes place. Included in our lottery insurance is to calculate the premium of every draw and in case of a claim we will payout the winning amount immediately after completing all necessary checks.
Solutions for Prize Indemnity risks
Prize competitions are a valuable marketing tool for all manner of businesses, giving the opportunity to sell product, drive traffic to websites, and raise the profile of social media channels.
With the ever-increasing value of lottery prizes however, a winnerâ€™s pay-out has the potential to put a big dent in a company`s bottom line. Prize Indemnity insurance provides essential protection for insureds against the contractual liability to pay out in the event of a competition win.
At Safe online we can deliver statistically-based insurance solutions for Prize Indemnity risks. We have a dedicated panel of insurers with the necessary experience and first-rate security who can offer our clients significant limits of coverage to assist with the larger jackpots and roll overs in the market today.
Insurance and Lotteries are Opposites
This is a paradox that has puzzled economists for a long time.Â Think about it, a lottery is theÂ exact opposite
Â of insurance.
When it comes to insurance, a person purchases coverage to hedge against risks.Â In a lottery, sums are spent for a long-shot chance at the 'risk' of a payoff.Â
People are risk-seekingÂ when it comes to playing the lottery yet risk-averseÂ when it comes to purchasing insurance.Â What gives?
A Primer on Insurance
There are all sorts of types of insurance:
even body-part insurance
and a universe of many more.
In exchange for a recurring or one-time fee, a policy's holder hedges against some event occurring - say, in the case of body-part insurance, damage to a limb.Â If that event occurs, the policy's issuer will pay out according to the details of the policy. This might be a lump sum in the case of life insurance, or the cost to repair damage to a vehicle in car insurance.Â
In theÂ insurer - insuredÂ relationship, theÂ insuredÂ reduces risk by buying the policy while theÂ insurerÂ spreads risk by issuing many policies. The insurer attempts to collect total premiums or lump sum payments in excess of the cost of a negative event, and invest any money collected in the meantime.
To explain why a risk-seeking person might acquire insurance, it's best to keep a few things in mind.
First, some forms of insurance come with a job, commonly health and life insurance.Â Other forms of insurance areÂ requiredÂ - for example, home insurance is required for a mortgage, and car insurance is required to operate a car in many states.
All of that doesn'tÂ quiteÂ get to the heart of the issue - take car insurance, for example.Â
Car insurance laws come with mandated policy minimums. In many cases, you can purchase cheap car insurance and set your coverage to the lowest allowable amount. In some states, you can evenÂ self-insureÂ with sufficient reserves.
However, in many casesÂ even people with risk-seeking personalitiesÂ will get more insurance than mandated.