Indeed. In reality, the vast majority of people do not have sufficient information to make reasonable estimates of the probability of loss—and in many cases, even the size of the loss.
Eg a landlord is required to rebuild the place and temporarily rehome the tenants while that’s being done in the event of the house being destroyed by fire or flood. They’re also liable for compensation and healthcare of affected third parties—and legal cost of determining those figures.
They can probably calculate the rebuilding cost and a reasonable upper bound on temporary housing. But third party liability?
Indeed. In reality, the vast majority of people do not have sufficient information to make reasonable estimates of the probability of loss—and in many cases, even the size of the loss.
Eg a landlord is required to rebuild the place and temporarily rehome the tenants while that’s being done in the event of the house being destroyed by fire or flood. They’re also liable for compensation and healthcare of affected third parties—and legal cost of determining those figures.
They can probably calculate the rebuilding cost and a reasonable upper bound on temporary housing. But third party liability?
So, it still comes back to vibes.