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Is the world becoming uninsurable?

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Re: Is the world becoming uninsurable?

#311

Post by robocat »

lostlogin wrote: post #213
CalRobert wrote: post #198

Earlier quoted context omitted.

For what it’s worth, you can get a house with no insurance or mortgage. They tend to be cheap. I had an uninsured thatched cottage for a while, it was 68k

You can have a mortgage with no insurance (after purchase day) here in New Zealand. The bank won’t like it, but also won’t know.

You are right that you can get away with it in NZ.

For total loss then bankruptcy might save you money (assuming you have no other assets or kiwisaver; since you still owe the debt).

But part of the contract with the bank is allowing the bank and insurance company to verify/update.

If you cancel your insurance, the insurance company is incentivised to tell the bank since you will probably sign up for insurance again when told to by the bank. I don't believe the banks or insurance have push updates. I would guess banks batch check if insurance is still live annually?

I live in Christchurch and I believe insurance is valuable risk management - plenty of people gambled and lost with Earthquakes. That said: I own an as-is house because I bought a 3 bedroom on 800m2 for $190000 (cheap because you can't get a mortgage for it because it is uninsurable due to subsidence - I only paid land price).

Re: Is the world becoming uninsurable?

#312

Post by andy800 »

hakfoo wrote: post #234
roenxi wrote: post #179

Earlier quoted context omitted.

If the regulators have defined 'price gouging' as a price substantially below the break even mark, literally any profitable insurance product is implicitly believed by them to be price gouging. The US does a weird thing where "insurance" no longer means pooling risk but some sort of transfer payment welfare system. If they're going to define "price gouging" as profitable activity it is hard to see how the economy is…

The math of insurance suggests that, if it needs to be widely carried (either due to things like mortgage requirements, or the simple realization most people don't have enough resources to absorb a major catastrophe themselves), the most economical way to go is to have a single risk pool that's as broad and diverse as possible, so it can swallow a large clustered crisis more easily. Yes, this is a bit of robbing Pete…

you can either isolate the LA customers and charge them the "real" price of the risk, which will be unviable as a business

NOT lining up the premium with the actual risk is what's non-viable.

Re: Is the world becoming uninsurable?

#313

Post by irrational »

Animats wrote: post #107

Not uninsurable, but buildings are going to have to become tougher. It's happened before. Chicago's reaction to the Great Fire was simple - no more building wooden houses. Chicago went all brick. Still is, mostly. The trouble is, brick isn't earthquake resistant. Not without steel reinforcement. I live in a house built of cinder block filled with concrete reinforced with steel. A commercial builder built this as his…

We live in an ICF house. People don’t realize it is “framed” with concrete instead of wood unless we tell them. Siding on the outside and drywall on the inside.

Re: Is the world becoming uninsurable?

#314

Post by [deleted] »

hnburnsy wrote: post #262
forgetfreeman wrote: post #110

Earlier quoted context omitted.

Given over half of all households in the country have less than $20k in savings I'd say concerns over equality of access may be well founded. Edit: No? The poors can go fuck themselves? Alright then I guess.

How does just offering higher deductibles, hurt the 'poors'? Nobody said do away with lower deductibles. Are you saying they are not sophisticated enough to understand a proper deductible for their situation?

[deleted]

Re: Is the world becoming uninsurable?

#315

Post by forgetfreeman »

hnburnsy wrote: post #262
forgetfreeman wrote: post #110

Earlier quoted context omitted.

Given over half of all households in the country have less than $20k in savings I'd say concerns over equality of access may be well founded. Edit: No? The poors can go fuck themselves? Alright then I guess.

How does just offering higher deductibles, hurt the 'poors'? Nobody said do away with lower deductibles. Are you saying they are not sophisticated enough to understand a proper deductible for their situation?

How does offering a deductible ranged well outside what the majority of households in the US can actually pay hurt anyone? If that isn't self-explanatory I'm not sure what to tell you.

Re: Is the world becoming uninsurable?

#316

Post by lionkor »

csours wrote: post #195
danielmarkbruce wrote: post #176

This is silly, and overcomplicating the issue. The world is very insurable, at a price. The property and casualty business is competitive as hell in almost all parts. The government needs to just stay out of it.

Ok, just play the next move. Insurance is expensive. Now what happens.

People don't build wood houses in an area that gets wild fires

Re: Is the world becoming uninsurable?

#317

Post by kgwgk »

throwawayqqq11 wrote: post #268
roenxi wrote: post #179

Earlier quoted context omitted.

If the regulators have defined 'price gouging' as a price substantially below the break even mark, literally any profitable insurance product is implicitly believed by them to be price gouging. The US does a weird thing where "insurance" no longer means pooling risk but some sort of transfer payment welfare system. If they're going to define "price gouging" as profitable activity it is hard to see how the economy is…

This sounds like a very US-centric view and id strongly disagree that only the profit motive keeps economies and people going. You almost said it yourself, "The US does a weird thing where insurance no longer means pooling risk". Why? Is it the profit motive or gov. regulation? My answer: The selective approach of insurance companies mirrors the profit seeking lack of solidarity, which is ultimately incompatible with…

> This sounds like a very US-centric view

> My answer: The selective approach of insurance companies mirrors the profit seeking lack of solidarity, which is ultimately incompatible with the risk pooling purpose

What’s the non-US-centric view? Lloyd's of London is older than the US.

Re: Is the world becoming uninsurable?

#318

Post by consp »

hnburnsy wrote: post #262
forgetfreeman wrote: post #110

Earlier quoted context omitted.

Given over half of all households in the country have less than $20k in savings I'd say concerns over equality of access may be well founded. Edit: No? The poors can go fuck themselves? Alright then I guess.

How does just offering higher deductibles, hurt the 'poors'? Nobody said do away with lower deductibles. Are you saying they are not sophisticated enough to understand a proper deductible for their situation?

Higher deductibles generally lead to a lower overall money pool raising overall prices. They allowed that here in a far more regulated market and the effect was about 4pct higher prizes across the board. Effectively the people who cannot afford the higher deductibles are subsidizing the ones who can as the end result.

Re: Is the world becoming uninsurable?

#319

Post by inferiorhuman »

defrost wrote: post #82
sdiupIGPWEfh wrote: post #78

Earlier quoted context omitted.

> flame retardant insulation Which are almost definitely known to the state of California to cause cancer.

Elsewhere fiberglass and mineral wool insulation aren't regarded as carcinogens. https://pubmed.ncbi.nlm.nih.gov/1947241/ https://mesothelioma.net/fiberglass-connection-to-mesothelio...

  mineral wool insulation aren't regarded as carcinogens
A quick look turned up one mineral wool SDS with a Prop 65 warning for formaldehyde.

https://www.jm.com/content/dam/jm/global/en/MSDS/20000000205...

Re: Is the world becoming uninsurable?

#320

Post by [deleted] »

nobodywillobsrv wrote: post #289
johnisgood wrote: post #287

Earlier quoted context omitted.

Yeah, I'm surprised that the damages of the LA fire occurred, because it was known beforehand that California had a fire problem (and also have an earthquake problem I think). I'm here in Eastern Europe and our buildings can withstand a lot of things. > we need to take action to mitigate their impact in the future. As a foreigner, it seems to me that Americans prioritize building cheap homes over constructing better…

The government banned insurance companies from raising prices. They used tax payer money to subsidize this for a while which increase home prices. Eventually insurance companies stopped offering insurance. When state actors even dabble in socialism disasters happen people die.

[deleted]
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