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Houston is experiencing its third ‘500-year’ flood in 3 years

washingtonpost.com

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Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#121

Post by dyarosla »

schoen wrote: post #97
Mz wrote: post #94

Earlier quoted context omitted.

No, that isn't why. I worked in insurance. Not homeowners insurance, but I had a certificate and processed claims. The reason is that most human settlements occur in flood plains because we cannot live without water. We drink it. We bath in it. We irrigate crops with it. Flood plains have fertile soil. We use rivers and oceans for essential cargo transit. Insurance is about risk management. It is a form of betting. A…

I find this a little confusing, because one can also purchase life insurance, and mors certa, hora incerta .

I had to look it up to confirm: "death is certain, its hour is uncertain" (latin)

Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#122

Post by matt4077 »

cat199 wrote: post #104
maxerickson wrote: post #31

Earlier quoted context omitted.

Should any land be required to have flood insurance? The NFIP supposedly reduces taxpayer cost (with the shaky risk management you mention), but it currently has huge potential liabilities compared to the premiums it collects (and owes the government a bunch of money from past payouts).

Hey we've got a legal mandate to fund insurers now with our 'public private partnership' healthcare system.. pick this up as your issue and you might have a lucrative career in lobbying lined up..

"Now"...

The National Flood Insurance Act of 1968 established the government-backed flood insurance scheme. It has Ronald Reagan's signature. https://en.wikipedia.org/wiki/National_Flood_Insurance_Act_o...

The idea was and is twofold: first, it was seen as the only possibility to actually provide such insurance because insurance companies (even together) lack the financial strength to be able to insure risks that are statistically extremely dependent. Something like this flood costs dozens of billions, and it would bankrupt the whole industry.

Secondly, it's in the national interest to promote such schemes that allow for more areas to be used productively.

Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#123

Post by matt4077 »

Clubber wrote: post #40
rsync wrote: post #37

Earlier quoted context omitted.

"Fort Bend County Judge Robert Hebert stated that Hurricane Harvey is more like a 800-year event" 500 years, 800 years ... even 1000 years - none of those are timetables that planning for city ^H^H^H^H region the size of Houston should be operating on. A city that large, that populous and with that much economic activity that is crucial to the world should be using risk models to 10k year events. This is not unpreced…

Sounds like the city fell asleep at the wheel, or rolled the dice and didn't want to pay for proper drainage. Now the citizens get to pay. Sounds like the Judge is preparing the country for the fact that nothing will still be done about it.

Coastal protections are under the purview of the Army Corps of Engineers, a federal institution, one of the most sclerotic of the government institutions, and one of the rare beasts that actually deserve the common cynicism with government action.

Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#124

Post by lutorm »

MarkMc wrote: post #95

The problem is that the person who judges the probability at 1-in-500 doesn't have any skin in the game. The judgement of the US meteorological office affects where people can build houses and how much they pay for government insurance. Homeowners have a strong financial interest in underestimating the probability of a severe flood, so there is likely subtle political pressure applied to the met office assessments. F…

Homeowners have a strong financial interest in underestimating the probability of a severe flood

I don't know about that. Even if I have flood insurance, it's not clear I'm financially better off by having my house flood. It may be a confluence of "financially not fully liable" and wishful thinking, though.

Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#125

Post by cmurf »

Mz wrote: post #109
schoen wrote: post #107

Earlier quoted context omitted.

Could you then have the same kind of structures for flood insurance policies? I had to pay every year to renew my renter's insurance policy, it only covered losses during the course of that year, and the insurance carrier had discretion to adjust the premiums or not to renew it.

In the US, flood insurance is provided by the government. And the premiums still jump insanely sometimes. It gets handled this way for the same reason our government provides welfare et al: it makes no sense as a business, but the cost to the nation to do nothing is a bigger problem.

There is some private flood insurance these days, but I don't know who offers it, in what locations, what the premiums are, and what kinds of exclusions there are. Since it's a new thing, I think the claim that it'll be vastly better than NFIP is invisible hand waving. Nevertheless... http://www.insurancejournal.com/magazines/features/2017/07/1...

I think the bigger issue is that there is an inherent incompatibility between free markets (or strict laissez faire, non-intervention of any kind) and democracy. Of course people, in the millions, are going to say "help us" and direct it at their various layers of government, and punish those who don't at the election booth.

Therefore it stands to reason in major floods like this, that everyone is going to get some kind of relief even if they didn't have flood insurance. What I'm not sure of is whether the insured get 100% payouts and those not insured get partial payouts? What's the incentive to have flood insurance, except in smaller, localized, 50 or 100 year floods?

This is asset destruction and the only way to properly handle it is through savings. So it's either made compulsory or you do end up with something of a free loader problem. Whether that free loader problem is a real problem, I don't know.

Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#126

Post by throwawayjava »

jessaustin wrote: post #39
lukeschlather wrote: post #36

Earlier quoted context omitted.

I don't think it's accurate to say we only have 150 years of data. We only have about 150 years of data collected in real time by humans, but we have plenty of other data. (Soil/rock strata,core samples, tree rings, etc.) In some ways the geological and archeological evidence is more trustworthy than the evidence we've written down in the past century or two.

Do floods show up on the "geological and archaeological" records? Sure we can say that 50M yrs ago there was an ocean here, but that's a different statement than "in the last 1000 yrs there have been 14 floods that reached this height above the river".

Big ones absolutely do. I'm not sure how small floods can get before the answer is no. IMNAG.

Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#127

Post by idlewords »

sjg007 wrote: post #96
idlewords wrote: post #18

Earlier quoted context omitted.

I don't think I understand what you're saying. To be able to say things about 0.2%/year events, we would need many thousands of years of data on an unchanging system.

This is not true. You can assume a uniform prior and run your model through bayes law and come up with an estimate.

That's called "making things up", but sure.

Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#128

Post by maxerickson »

JimboOmega wrote: post #53
idlewords wrote: post #14

Earlier quoted context omitted.

There is no way to credibly make this kind of claim. We don't have the data to quantify the recurrence rate of low-probablity events like this, nor can we be sure the the underpinning mechanism isn't changing with time.

And why would a judge (And not someone in environmental sciences) be making that claim anyway?!

He's the chief county administrator.

Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#129

Post by idlewords »

tedunangst wrote: post #69
WorldMaker wrote: post #28

Earlier quoted context omitted.

The problem is not making numerical estimates of low probability events or how such events are modeled: it's completely ignoring the statistical probability distributions of the model. All of the models are extremely "long tail" distributions and just about entirely ignoring the long tail. We shouldn't be referring to this as a low-probability flood but as a high sigma flood. ETA: Disclaimer: Day job includes rainfal…

I don't know much about the field, but I'm curious. How much are estimates based on normal distributions, and how much does the model consider other distributions? As you say, I don't think we know much about the tail. More than ten inches of rain may be a once a year phenomenon, but that once a year event might be twenty or fifty inches?

I am not a math, but I remember that if you can't assume a normal distribution and want to know the shape of the tails, you need a pretty ridiculous number of observations.

Re: Houston is experiencing its third ‘500-year’ flood in 3 years

#130

Post by CamperBob2 »

Mz wrote: post #94
bmm6o wrote: post #58

Earlier quoted context omitted.

This is part of the reason few private insurers offer flood insurance. They understand they there isn't enough information to properly price the risk. The historic data is spotty, we don't understand the geography well enough, you have to understand how construction and urbanization affects water absorption over long distances. If everyone who claimed to know what a 500-year storm looked like had to pay out every tim…

No, that isn't why. I worked in insurance. Not homeowners insurance, but I had a certificate and processed claims. The reason is that most human settlements occur in flood plains because we cannot live without water. We drink it. We bath in it. We irrigate crops with it. Flood plains have fertile soil. We use rivers and oceans for essential cargo transit. Insurance is about risk management. It is a form of betting. A…

That's a fool's bet to say "I will pay you X amount of money if it floods" when it is guaranteed to flood sooner or later. That amounts to charity, not insurance.

A statement with profound implications in other areas of insurance, notably health insurance. You're insuring against expensive losses that will almost certainly happen at some point... which suggests that traditional insurance isn't the right framework for solving the problem at hand.

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