First, it means insurance seems to cost more than it's worth; not many see the wisdom in paying $11 for $10, even if the $1 is basically a service fee that ensures the $10 retains its value. Businesses and individuals with less money therefore opt for their own methods of keeping excess capacity. But for small-scale operations that are already cost-constrained, what does this actually mean? The coin laundry can keep some extra quarters on hand but it cannot afford to keep a massive stockpile; the local hospital might be able to keep a spare room or two for extra PPE but it needs to devote as much space as possible to earn revenue from other services. Insurance might seem like it's too expensive or just a bad deal, but this reasoning forgets an important fact; if you can't afford the insurance, you probably can't afford to buy your own spare capacity.
The second issue is that insurance fails when too many policies are cashed at once. The reason there is no such thing as 'quarter insurance' is because when one policyholder encountered circumstances that required quarters, it's likely these same circumstances apply to the other policyholders. It's not possible to run an insurance business when most premiums could be cashed out due to one event. This is why most hospitals couldn't sell their excess capacity to neighbors back in the spring - the catalyst for one hospital reaching capacity would quickly mean the same result for all others. If one passenger is boarding a lifeboat, you can be sure everyone is queuing up to do the same.
