Moral hazard and fraud is always there with any type of insurance products. So you need to calculate the likelihood of false claims and build this into your premium.

I would agree with the previous poster. You need to think how long it would take to earn the money you paid. If it is a solid business, I wouldn't mind paying a premium of 3 years earnings. So, it would depend on how highly you rate the business and how comfortable you are with it. For example, some...