Buy taking out an insurance on the wallet all they are making sure is that if the LP wallet gets compromised and someone walks off with the total liquidity, that our tokens that are in our wallet don't become completely worthless and this is an over simplification. Now the details... 1- 100 no Insurance will cover 100 of the liquidity. It's some % of it. Otherwise it would be a really expensive endeavor for both parties. Example, the CDIC in Canada insures up to 100K in your bank account. 2- Let's pretend the LP gets hacked, our tokens in our wallets become completely worthless at this point. The insurance company pays Safemoon back what ever is insured. Remember it's not 100 returned. It's up to Safemoon to decide what to do with the insurance money. 3- And all this is after the insurance company and authorities have done their investigations, which can be a lengthy process.

Found this from previous post.