For example, although the probability last year of a pernicious deflation in the United States was small, the potential consequences of that event were sufficiently worrisome that the possibility of its occurring could not be ignored.
To eliminate the subsidy in deposit insurance - to make deposit insurance a real insurance system - the FDIC average insurance premium would have to be set high enough to cover fully the very small probabilities of very large losses, such as those incurred during the Great Depression, and thus the perceived costs of systemic risk.