From a players perspective there is very little difference between playing a Lottery or betting on the outcome of lottery jackpots. The user journey is similar with the added benefit that the user has the opportunity to win on jackpots that would otherwise have been unavailable to them.
If a player matches the jackpot draw result with their chosen numbers they win an amount equivalent to the official jackpot draws.
If a player wins then the payout is covered by insurance, the ticket is paid out and the player is paid. Using insurance allows operator to offer more attractive and inflated jackpots as effective acquisition strategy.
In the background this is the management of risk. Through a network of operator bets, specialist insurance brokers, their re-insurance network, and ability to purchase directly manages all jackpots across risk and liability levels.
Insurance is both complex and constantly moving problem. Whilst jackpots fluctuate in size and risk on a draw basis the ability to insure is also dependent on macro and micro econmic events. The ability to securely and legally directly purchase tickets with Lottery providers is a key component of this insurance system.