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The risk offered by any given particular person is assumed collectively by the neighborhood who all bear the price of rebuilding lost property and supporting folks whose needs are suddenly larger after a lack of some type. In supportive communities where others could be trusted to comply with community leaders, this tacit form of insurance can work. In this fashion the neighborhood may even out the intense differences in insurability that exist among its members. Some further justification is also supplied by invoking the ethical hazard of explicit insurance contracts.
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