Most advanced countries have comprehensive socialpolicies addressing the issues in labor markets.However, there are considerable differences acrossnations with regard to their coverage and generosityof publicly provided social assistance. Additionally,most of the public programs have been subject tosubstantial changes over time. These disparities canbe related to the certain labor marketcharacteristics and in particular the risk exposureof the employees. The book inspects the underlyingreasons of demand for social insurance byestablishing a direct link to labor marketuncertainties. Occupational unemployment rate istreated as an estimate of labor market risk, and itis concluded that this is the main explanatoryvariable. The results suggest that rather than thetype of human capital investment, other forms oflabor market risks shape the insurance policies. Thebook is a contribution to the literature on publicchoice models of social policy and individual socialpolicy decisions.