What is risk premium in poker?

Risk premium is the extra equity a player needs above the raw pot-odds breakeven point before an all-in becomes profitable, once tournament survival itself is worth something beyond the chips at stake.

It's the same underlying idea as bubble factor's required-equity number, phrased differently: instead of a ratio, it's stated directly as “how much equity above breakeven do I actually need here.” Both describe the same ICM pressure from two angles.

A worked case makes the size of it obvious. Facing an all-in where the pot odds say you need 40% equity, a risk premium of 8% means you actually need 48% to call profitably in tournament dollars. That eight points is not a rounding error - it is the difference between calling with A9o and folding it, and near a bubble the premium on a medium stack can run well into double figures.

Risk premium is specific to the pair of players in the confrontation, not to the table. Against a shorter stack that cannot eliminate you, the premium is small and can even be slightly negative, because knocking them out has value of its own. Against a covering stack it is at its largest, since losing ends your tournament. This is why the same hand can be a call against one opponent and a fold against another with an identical range, at the same table, in the same orbit.

It shrinks as the payout structure flattens out and grows as it steepens. Deep in a final table with big jumps between places, risk premiums are enormous and correct play is far more conservative than chip-EV suggests; in a flat, top-heavy field early in the money they are small enough to mostly ignore.