Can I Insure for My Betting Losses?

Audrey M. Jones
Two aces playing poker

In general, an insurance agency or company will not insure you against betting losses. They view this type of insurance as too high of a risk.

Loss Potential

Insurance companies provide consumers with protection against unexpected losses. Prior to issuing a policy, they assess the possibility of the event happening against which the policy protects. This involves complex analysis of data, history of the event, and consideration of the type of protection the consumer seeks. If the company believes that the likelihood of the event occurring is low, making it unlikely that they will have to pay money to the consumer, they will issue a policy. The consumer pays for the policy, which is referred to as a "premium." Should loss occur, they may also have to pay a specific amount of money out of their own pocket before the policy comes into effect; this is called a "deductible."

Insurance companies are in the business to make money. Essentially, they weigh the risk of their needing to pay a consumer against their income from the policy. They are unlikely to issue a policy for an unreasonable risk.

Insuring Betting Losses

Betting of any type places money at risk. Regardless of your skill, knowledge, and experience, every time you place a bet you risk losing it. There is no guarantee that you will win and, in fact, such guarantees might be illegal.

Because of this, most insurance companies will not insure your betting losses. To do so would require them to weigh the risk of a risk. Specifically, they would need to determine the likelihood that you will win and not incur losses. Because there is no guarantee that you will continue to win and not incur any losses, the risk is too high.

Although insurance companies always assume some level of risk when they issue a policy, those risks are inherently more measurable and predictable than those associated with betting losses. For example, the insurance company can predict the likelihood of a hurricane hitting the coast of Florida and the damage that hurricane will cause to a home valued at $250,000. The company, however, cannot predict the likelihood of your losing $250,000 betting, regardless of how much evidence you have and how long it was since you last lost a bet. This inability is what makes betting losses an unacceptable basis for an insurance policy.

The amount of evidence you have about your betting history is irrelevant. This is because there is no way to predict that prior trends will continue. You may have steadily placed successful bets over the last five years, but there is no telling whether that streak will remain the same in the short or long-term.

Finally, the insurance company cannot control your betting losses. In a loss, such as one caused by a hurricane, the company can control how much it spends by determining which losses are covered and how much the consumer must pay before the policy comes into effect. In this example, the company manages their losses. In betting, however, there is no way to control how much you bet at a certain time. This means that they could be required to pay the full amount of your policy without being able to assert any control over the situation.

Alternatives to Insuring Your Betting Losses

Although you cannot insure your betting losses, you can insure other of your assets. Generally, you cannot personally insure anything consisting purely of cash, such as an investment or bank account. You can, however, insure tangible property, such as a car, boat, or property.

You may consider insuring a piece of property to cover your betting losses. To recover on the policy, the insured property would have to sustain some damage or be completely destroyed. You cannot damage the property yourself without voiding the policy.

Can I Insure for My Betting Losses?