If the 1:12500 odds are right, then each shot pays an average of 80 dollars. (I know nothing about actuarial science, so correct me if I'm wrong...) Seems like you'd need an 81 dollar premium per driver to profit.
Further, there's a lot of asymmetrical information possibilities. What if a pro golfer (whose odds might be 1:500) decides to show up?
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Why does the insurance company need to be stupid?
If the 1:12500 odds are right, then each shot pays an average of 80 dollars. (I know nothing about actuarial science, so correct me if I'm wrong...) Seems like you'd need an 81 dollar premium per driver to profit.
Further, there's a lot of asymmetrical information possibilities. What if a pro golfer (whose odds might be 1:500) decides to show up?