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Home insurers are dropping customers based on aerial images

wsj.com

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Re: Home insurers are dropping customers based on aerial images

#531

Post by positr0n »

marcosdumay wrote: post #213
Analemma_ wrote: post #110

Earlier quoted context omitted.

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.

Woah, where can you buy a house that 90% of the money you spend is land? Is that even true in expensive downtown US cities like SF and NYC?

Construction is pretty expensive too.

Re: Home insurers are dropping customers based on aerial images

#532

Post by Too »

AdieuToLogic wrote: post #510
Kalium wrote: post #502

Earlier quoted context omitted.

At the risk of being callous, the goal of home insurance is to assess and manage risk. Choosing ignorance in the interests of giving some people a subsidy on the assumption that they may be poorer does not further these goals in any way I can see. If the goal is redistribution, then using accurate risk data as a starting point seems preferable.

> At the risk of being callous, the goal of home insurance is to assess and manage risk. No, risk assessment and/or management is an internal operational concern. The goal of insurance providers, home or otherwise, is to charge fees such that the insurer collects as much revenue as possible while simultaneously expending as little as possible to remedy claims. Any justification legally available to an insurer support…

If your insurers goal is revenue i suggest you go look for a new mutual insurance.

(no, this is not some hippie collective thing, in many countries this is the norm, see https://en.wikipedia.org/wiki/Mutual_insurance)

Re: Home insurers are dropping customers based on aerial images

#533

Post by hattmall »

PaulDavisThe1st wrote: post #426
tptacek wrote: post #317

Earlier quoted context omitted.

It depends on the policy, but either way, this is the kind of risk we're talking about managing with culls: trampolines, and bad roofs. I pay to keep my house up. You (say) don't. Why should I be OK with subsidizing your resulting claims with higher rates? I think there's a sort of weird subtext in the "risk pooling" discussions on this thread that "risk pooling" is a way for people who don't replace their old roofs…

You seem to be forgetting that this avoidance can work at two times: 1. pre-emptively dropping or refusing coverage 2. claim inspectors concluding the company has no liability for a particular incident. It doesn't all need to be #2 (and probably should not be), but it also doesn't all need to be #1 either.

#2 is less successful and incurs more costs. Trampolines are a good one because let's say you lie about a trampoline. Ok, great, we don't have to cover any trampoline related injuries. What are the chances that you would then lie and say that a broken arm occured on the steps instead and simply fail to mention the trampoline like you already did.

Re: Home insurers are dropping customers based on aerial images

#534

Post by krab »

doubled112 wrote: post #44
devbent wrote: post #34

Earlier quoted context omitted.

Trampolines are obscenely high risk and injuries are very common. On top of that, if a neighborhood kid comes in to your yard and breaks their leg on your trampoline, your home owners insurance is going to be involved.

Is this something we just don't worry about in Canada? Because we only pay to park at the hospital?

Possibly. Also in my country (in EU), the home insurance doesn't cover your liability for an accident like this. That would be another type of insurance you buy extra.

Re: Home insurers are dropping customers based on aerial images

#535

Post by mb7733 »

shepherdjerred wrote: post #397
dragonwriter wrote: post #372

Earlier quoted context omitted.

> That wouldn't be pointless, because you would have a predictable expense instead of an unpredictable expense. What you're describing is actually the ideal scenario for both individuals and companies No, if the expense were that predictable, the best case would be dispense with insurance entirely, since it effects the cost not at all and imposes overhead, especially insurance where the rates are accurately computed…

If you can manage your finances well, then sure. Many people would see that pile of cash in their savings and spend it. Paying a monthly amount to a third-party is safer in many ways, even if you have some % of overhead.

I don't care how well you manage your expenses, it doesn't make sense to keep enough cash on hand to rebuild your house if it burns to the ground. (Not to mention that is completely impossible for almost everyone.)

Re: Home insurers are dropping customers based on aerial images

#536

Post by hattmall »

tptacek wrote: post #374
skissane wrote: post #371

Earlier quoted context omitted.

We used to have a trampoline. We never once told our insurer about it. When I first applied for the insurance (at the same time we bought the house), I have no memory of being asked if we had one (we didn't at the time). I don't remember ever seeing that question from them, although I can't be completely certain it wasn't on some piece of paper and I didn't notice it. If they never ask, I'm under no obligation to tel…

Look, I hear you, but at some point this has to be on you. The CPSC has a thing dedicated to trampolines. The Mayo Clinic has articles about it. It is a huge cause of injuries of minors around the country. I'll grant that this is slightly more obscure an issue than swimming pools, but there are tons of swimming pool buyers who would make similar claims ("nobody told me swimming pools were that risky, this is just fin…

I just bought homeowners, it didn't ask anything about trampolines. Am I expected to call them up and inform about one? They specifically ask about a pool and if it is fenced or not.

Re: Home insurers are dropping customers based on aerial images

#537

Post by Eisenstein »

skissane wrote: post #519
Eisenstein wrote: post #507

Earlier quoted context omitted.

Pointing out outliers isn't really helpful when talking about what could be expected in an insurance claim.

Okay, but the point also remains with respect to averages. For example, compare how the UK and the US handle compensation for lost future earnings in wrongful death cases. In the UK, judges are guided by the "Ogden tables", actuarial tables published by the British government. The judge will use the deceased's age to look up a multiplier in the tables, which will be multiplied by their income at the time of death, to…

I agree that the systems are different and one is more oriented towards payout because we have little to no social safety nets so whatever the victims get has to last them for life, among other reasons I described above.

Are you trying to say that one system is bad and another is good? They are different for different reasons, which can be explained by the structure of the society and what we expect courts to provide for us as opposed to other areas of government or private parties.

Re: Home insurers are dropping customers based on aerial images

#538

Post by devoutsalsa »

trogdor wrote: post #138
brogrammernot wrote: post #69

Earlier quoted context omitted.

Alright, I spent years working and building 0-1 insurance products. Let me peel back some stuff that’s been happening behind the scenes. Some officials are elected and some are appointed which all depends on the state. Appointed officials are usually more reasonable and elected are not because higher rates = mad voters = re-election chances lower. For a long time, insurers have struggled to get sufficient rate change…

Why are insurance rates regulated by the government? I understand that the state has a strong interest in ensuring that insurance companies are adequately capitalized, but I don’t understand the state interest in directly regulating premium prices. (Or is that not what you are referring to?)

“When it comes to rate regulations for overall insurance, according to state regulations they should not be excessive in any way. This means that they must be affordable, and are not set too high in relation to insurance claims. Insurance rates should also not be inadequate. This means that they should not be marketed at a rate that is too low. The Insurance rates should also not be discriminatory in any nature, meaning that all insureds are charged similarly for similar coverages. These rate regulations are imposed on insurance companies in order to protect consumers. (Dorfman and Cather)”

Source: https://www.lawteacher.net/free-law-essays/judicial-law/gove...

Re: Home insurers are dropping customers based on aerial images

#539

Post by everybodyknows »

tptacek wrote: post #422
ssl-3 wrote: post #417

Earlier quoted context omitted.

How is an unversed lay homeowner who is inexpert in the insurance industry (or perhaps even any industry) supposed to know what risks an insurer thinks are important? Their job, I think, is to accept the quote, pay the premiums, and to keep living life.

On 1-3 occasions over the course of an insured's entire life, they'll be confronted with the paperwork for the insurance contract for the most expensive asset they'll ever buy. They should read it.

> They should read it.

Indeed. This is how I discovered that my own policy forbade me to own a dog belonging, even in part, to any of a long list of breeds: Pit Bull, Rottweiler, Cana Presario ... IIRC German Shepherd was on the list.

Re: Home insurers are dropping customers based on aerial images

#540

Post by datascienced »

delecti wrote: post #446
non-chalad wrote: post #443

Earlier quoted context omitted.

The solution seems to be to remove the insurance mandate, and allow purchasing insurance across state lines. That way two locked-in markets are opened to more competition.

Effectively removing the ability of states to regulate businesses in their own jurisdiction.

How is it different from someone outside CA buying Google ads?
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