Meanings
- informaluncountablebusinessThe situation where an owner sells a company but retains a portion in case the price appreciates in the future.
In Wall Street parlance this is known as "schmuck insurance," a reference to the rather vulgar Yiddish word that has come to mean the equivalent of "idiot."
2011 June 13, Shira Ovide, “The Benefits of Deal 'Schmuck Insurance'”, in The Wall Street Journal1 more example
The solution? Instead of selling 100% of the business, the seller either keeps a stake, or keeps an option to buy back part of it later. This solution, which was apparently popularized by Time Warner CEO Dick Parsons in the early 2000s ($, WSJ), is known as "schmuck insurance”.
2023 April 5, Byrne Hobart, Capital Gains
Origin
From schmuck (“fool, idiot”) + insurance.
Full word history & related roots →Cite this entry
schmuck insurance. (n.d.). In WatkinsX Dictionary. Retrieved November 5, 2026, from https://dictionary.watkinsx.com/word/schmuck%20insurance
“schmuck insurance.” WatkinsX Dictionary, https://dictionary.watkinsx.com/word/schmuck%20insurance. Accessed November 5, 2026.
WatkinsX Dictionary, s.v. “schmuck insurance,” accessed November 5, 2026, https://dictionary.watkinsx.com/word/schmuck%20insurance.
Source: schmuck insurance on Wiktionary, CC BY-SA 4.0.