I can see that there'd be a moral hazard in betting on (say) the death of a specific person, in that one might be tempted to kill them so as to win the bet. But the whole human race including the person you placed the bet with? If you kill them, they can't pay up. (You could, I suppose, take the money from their corpse, but then you could do that even if you hadn't placed a bet with them, so I don't see that the bet adds any additional moral hazard to the existing temptation to kill people and take their stuff. Besides, half the point is for them to know they lost.)