The insurance is there to prevent run on retail banks by the general public.

It is expected that you manage your risks if you have significantly more than the insured amount.

I'm not going to pay to insure a millionaire. Insurance is not free.

With the way things are going, don't be surprised if some silicon valley innovator come with insurance product that can be purchased after the fact. With marketing like "Come, Disrupt the Insurance Industry" it might just work out fine

The first sentence is basically what Tan is proposing

Minus the “purchased” part. He just wants it.

Yes I forgot to mention the key part

>The $250,000 FDIC cap is a favor to banks. They only pay fees to insure up to that amount. This is not correct. Banks pay FDIC premiums on ALL liabilities - not just insured ones [0]

>The FDIC should require deposits to be insured, no matter the amount. This exacerbates the moral hazard problem [1]. Basically, if all deposits were insured, then bank executives would have no restraint on risk taking. If you think things are bad now, imagine a situation where bank executives know depositors would always be made whole no matter what they did. An unlimited deposit guarantee is a recipe for disaster. [0] https://www.fdic.gov/resources/deposit-insurance/deposit-ins... [1] https://dailyreckoning.com/fdic-fosters-moral-hazard-among-b...