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Is providing insurance a call or a put option for the insurer?

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βˆ™ 2009-09-29 02:56:52

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When you buy an insurance on your asset, you are essentially buying a put option on your asset for protection much like the Protective Put options trading strategy. As such, to the insurer, they are actually selling a naked put option to the buyer of the insurance.

2009-09-29 02:56:52
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