Having someone ready to fall back on should one not be able to get laid. This can be a friend, a f*** buddy, a partner in an open relationship, a sex acquaintance, etc. Problems often arise when 2 people both have sex insurance with each other, and only one gets laid, or one takes out too many sex insurance policies ie. sex insurance with too many people.
2 - Mike and Ted happened to not pick up any chicks at the bar last Saturday. Luckily for Mike his sex insurance partner also had no luck that night and he called her on the way home to hook up with her.