Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Home insurers are dropping customers based on aerial images

wsj.com

Post reply on HN
Print view View original

211–220 of 712 posts

Re: Home insurers are dropping customers based on aerial images

#211

Post by treflop »

VHRanger wrote: post #65
landedgentry wrote: post #17

I'm less concerned about the spying and more concerned about insurance companies arbitrarily non-renewing policies with no recourse for the consumer. Insurance is heavily regulated for good reason, and insurance should be a source of stability instead of anxiety.

Thats exactly the problem with insurance. If I have any sort of risk mitigation (file backup, fire alarms, spare tire, a generator, whatever) I can test that it works periodically. So I know I'm actually safe for the event. For insurance, you can't know what bullshit they'll come up with to deny a claim when the time comes for it. You're left with having paid for the insurance all that time for nothing! Much better t…

I’ve known plenty of people who had legitimate accidents not of their own fault where insurance made them more than whole, and they would have not been able to afford the replacement if they had simply been saving for the same amount of time.

If you actually feel like you could recoup of the cost of paying for insurance by instead keeping the money in a piggy bank, you are buying too much insurance. There’s a sweet spot for insurance and overpaying for too little insurance is a you-problem.

Re: Home insurers are dropping customers based on aerial images

#212

Post by brogrammernot »

dan-robertson wrote: post #166
gumby wrote: post #143

Earlier quoted context omitted.

For the same reason credit card interest rates are regulated: there's an asymmetry in bargaining power. Car prices are not regulated because there are plenty of options for the consumer.

I thought there were also requirements that insurance rates are profitable (in expected value) to prevent some loss-making customer acquisition strategies and to reduce some long-term risks from insurers going bust. I’m not very confident in this claim.

Yes but less so on the rates themselves & rather do you have enough cash to stay alive without going under.

They’re obviously related but less regulatory focus on rates, more on cost of business and that.

Edit: Basically you can run at a loss (most do) for a limited period of time but have to show that you will be liquid on the other side of the losses.

Re: Home insurers are dropping customers based on aerial images

#213

Post by marcosdumay »

Analemma_ wrote: post #110
j45 wrote: post #88

Earlier quoted context omitted.

Except when those companies have lobbied to create laws to make the use of their industry mandatory.

I could be wrong, but I don't think there are any states where you are required by law to have home insurance. The issue is that banks won't underwrite a mortgage for an uninsured house, because without insurance it's a completely unsecured asset whose value would go to zero at any time. (And if a bank won't write a new mortgage for it, the value drops dramatically even if it's already paid off, because now the poten…

> whose value would go to zero at any time

No, it wouldn't. It would go down to the value of the land (where a construction is permitted).

Nowadays, that's often more than 90% of the price.

Re: Home insurers are dropping customers based on aerial images

#214

Post by dragonwriter »

tptacek wrote: post #134
toast0 wrote: post #127

Earlier quoted context omitted.

Car insurance isn't mandatory; proof of financial responsibility is. In California, you can get a compliant insurance policy, deposit $35k with the DMV, setup a compliant $35k bond, or a self-insurance certificate which requires a larger deposit and is really for commercial motor vehicle carriers. I don't think it's unreasonable to require means to pay for damages when operating a motor vehicle; it doesn't take much…

Side note here on how ludicrous it is that you can substitute a $35,000 bond for a real insurance policy, given the likelihood that any driver is going to cause losses far in excess of $35,000.

$35,000 is also the minimum liability coverage ($30,000 for death or injury to multiple people plus $5,000 for property damage.)

In either the bond, deposit, or liability insurance scenario, the responsible party remains on the hook for whatever is not covered in advance.

Re: Home insurers are dropping customers based on aerial images

#215

Post by more_corn »

nick7376182 wrote: post #136
lokar wrote: post #120

Earlier quoted context omitted.

In CA, a recent batch of wild fires wiped out 20 years of profits.

Then maybe they should have worked with customers proactively to prune trees and set up fire exclusion zones or fire resistant exteriors instead of sitting on their laurels raking it in.

Seconded. Also let’s require PG&E (the company that set the fires) to actually follow the maintenance and safety schedules they repeatedly promise to follow and repeatedly fail to follow.

Re: Home insurers are dropping customers based on aerial images

#216

Post by brogrammernot »

sdenton4 wrote: post #196
gizmo686 wrote: post #163

Earlier quoted context omitted.

Insurance with perfect info would be an amazing social good. If they could say "you can build a house there, but it will burn down in a forest fire 15 years from now", we could make an informed decision on if we want to build that house.

And yet, people build and rebuild in flood plains...

Yeah but that’s compounded by access to the information & who do you trust.

Also human nature is to look at the odds and not believe you’re going to be that 1 in 125,000 :)

Re: Home insurers are dropping customers based on aerial images

#217

Post by mk_stjames »

gmd63 wrote: post #67

Insurance bothers me for a few reasons: 1. What pisses me off more than anything else, it enables fraud that otherwise wouldn't exist. People manufacturing calamities and then claiming insurance allows dishonest people to get ahead in life over people who are honest and concerned enough about the future to buy insurance. Additionally, insurance fraud is net bad relative to other types of fraud because it encourages c…

Regarding your situation in point #3, if your claim was of significant monetary value (I'm guessing $>2k) I think at that point I would have cited them some numbers from journal studies on take home tests showing sensitivity of such home tests as at least (78.9)[1] percent of a professionally administered PCR test and that by their actuary logic you should then at least receive at least 78.9% in return compensation of your total claim based on this data and if they otherwise refused a payout your follow up would be with a claims lawyer.

I have no idea how that would play out but it seems like an interesting strategy to take.

[1] https://pubmed.ncbi.nlm.nih.gov/34448871/

Re: Home insurers are dropping customers based on aerial images

#218

Post by brogrammernot »

ls612 wrote: post #197
ska wrote: post #129

Earlier quoted context omitted.

Risk pooling is fundamental to insurance, but not all pools are the same. The observation is that if you aren't able to discriminate at all or subdivide the pools, the only response is to up the average rate to cover the aggregate risk as best you can estimate it. This gets tricky if your ability to change rates is constrained, also. These things are always in fundamental tension, and also in tension with privacy. It…

In extreme cases forcing too much pooling can cause market failure. The intuition is that the least risky customers decline to purchase (much) insurance, making the average risk higher, increasing prices, making more people decline insurance, in a vicious cycle. It’s fundamentally similar to Akerlof’s market for lemons.

This is always a fun topic for me.

If everybody is sharing all the risk that’s the same thing (obviously I’m being simplistic) as them underwriting the risk themselves.

Re: Home insurers are dropping customers based on aerial images

#219

Post by toast0 »

j45 wrote: post #183
toast0 wrote: post #127

Earlier quoted context omitted.

Car insurance isn't mandatory; proof of financial responsibility is. In California, you can get a compliant insurance policy, deposit $35k with the DMV, setup a compliant $35k bond, or a self-insurance certificate which requires a larger deposit and is really for commercial motor vehicle carriers. I don't think it's unreasonable to require means to pay for damages when operating a motor vehicle; it doesn't take much…

Fair, but there are lots of places, like Canada which require some types of insurance by law.

I'm unfamiliar with Canadian law, can you provide an example jurisdiction and required coverage?

Re: Home insurers are dropping customers based on aerial images

#220

Post by dragonwriter »

creato wrote: post #173
tptacek wrote: post #134

Earlier quoted context omitted.

Side note here on how ludicrous it is that you can substitute a $35,000 bond for a real insurance policy, given the likelihood that any driver is going to cause losses far in excess of $35,000.

The 35k bond doesn’t preclude getting sued for an unbounded amount. Presumably the idea is that a 35k bond demonstrates you have more available in case of a judgment. That said, that seems like a risky idea in a world full of LLCs, trusts, etc.

No. it demonstrates exactly the same minimum ability to pay as the alternative minimum deposit or insurance coverage, which are also $35k.
Post reply on HN