I think that the use of insurance for moderate harms is often a commercial boondoggle for insurers, a la health insurance, which breaks incentives in many ways an leads to cost disease. And typical insurance regimes shift burden of proof about injury in damaging ways because insurers have deep pockets to deny claims in court and fight cases that establish precedents. I also don’t think that it matters for tail risks—unless explicitly mandating unlimited coverage, firms will have caps in the millions of dollars, and will ignore tail risks that will bankrupt them.
One way to address the tail, in place of strict liability, would be legislation allowing anticipated harms to be stopped via legal action, as opposed to my understanding that pursuing this type of prior restraint for uncertain harms isn’t possible in most domains.
I’d be interested in your thoughts on these points, as well as Cecil and Marie’s.
Yes, I see a strong argument for the claim that the companies are in the best position to shoulder the harms that will inevitably come along, and pass that risk onto their customers through higher prices—but the other critical part is that this also changes incentives because liability insurers will demand the firms mitigate the risks. (And this is approaching the GCR argument, from a different side.)