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If the Silver star resort and casino roll is 5, 6, 7, or 8, you lose. Buying junk bonds is seen as a risky but potentially profitable form of investment.
Cancellation is truly risk free, but borrowers at the "risk free" rate are considered the least likely to default.
However, if the real value of a currency changes during the term of the debt, the purchasing power of the money repaid may vary considerably from that which was expected at the commencement of the loan. Thus, "discrimination" against (i.e., differential treatment of) potential insureds in the risk evaluation and premium-setting process is a necessary by-product of the fundamentals of insurance underwriting
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