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Is the world becoming uninsurable?

charleshughsmith.substack.com

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Re: Is the world becoming uninsurable?

#681

Post by smileysteve »

sandworm101 wrote: post #570
chillfox wrote: post #525

Earlier quoted context omitted.

It’s possible that solve the hurricane problems with proper building regulations and lower the risk of huge wildfires with controlled burning. But the US as always prefers to pretend that there’s nothing to be done when other parts of the world has figured it out. We have cyclones here similar to the hurricanes in the US and usually it just blows over some trees maybe causes a power outage. The absolute worst I have…

Wildfires are not the problem. They happen all the time without causing billion-dollar insurance claims. Insurance is always assets x risk. The issue is expensive flamable housing (assets) in a wildfire area (risk). We ask for trouble when we create million-dollar wooden houses surrounded by manicured gardens in desert enviroments. And build on a slope facing pervailing winds. The answer is concrete/brick houses with…

A forward looking (part of a) solution for Malibu would be the county acquiring and maintaining beach paths every few houses. Prescribed 10' wide fire breaks.

This solves the fire problem AND the limited access to a public resource that is common in Malibu.

Ideally a permeable surface without any growth, cleared at least 2x a year.

Re: Is the world becoming uninsurable?

#682

Post by rondini »

Sabinus wrote: post #112
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…

If the market is allowed to price insurance correctly then we can motivate building designs to be more disaster resist. If the McMansion can't get insurance but disaster resistant, modest homes do, then people will adapt.

Let's just consider Los Angeles for a second. For decades working class immigrants were pushed to the foothills in Altadena by redlining policies which placed them at risk for wildfires. Today their risk is exponentially greater due to the effects of unchecked climate change, and many cannot afford insurance even now.

How exactly do you expect these people to adapt? Many live in multigenerational households and could never afford to rebuild their house or move without uprooting their communities to another state.

Why are the victims made to adapt to the atrocious actions of the wealthy and powerful? Maybe our policy discussions should start from a place of compassion and work towards solutions from there.

Re: Is the world becoming uninsurable?

#683

Post by notatoad »

Insurance is America’s best method of pricing externalities. If America is becoming uninsurable, maybe they should look into other methods of addressing or minimizing those externalities.

Like requiring buildings be built to a standard where they can survive normal weather events, not building in disaster prone areas, not building in sprawling huge developments that eat up a ton of natural space and create a huge urban woodland interface, and trying to slow the pace of climate change by not dumping so much co2 into the atmosphere.

Re: Is the world becoming uninsurable?

#684

Post by urhmbutwait »

typewithrhythm wrote: post #167
urhmbutwait wrote: post #113

Earlier quoted context omitted.

That’s insurance? Change the euphemism from government to private insurance to satisfy capitalism gods and keep their giant foot from squishing us… still “on the books” as a co-mingled pool of funds to shift around to solve problems. Aw …sad… other people exist and need resources too. Not just about your first world skin suit playing temp host to a run of the mill electromagnetic field effect.

People choose where they live, and should bear the cost relative to the amount of risk they chose to take. Government funding is not a magical blanket that somehow makes it moral to take from someone who made good decisions and give to another who made poor ones.

[dead]

Re: Is the world becoming uninsurable?

#685

Post by lawlessone »

Obviously insurance companies, and i of course, would prefer if nobody anywhere ever had accidents or got sick etc

And i'd love it every lottery ticket, and horse i ever bet on was a winner

Feels like insurance companies just don't want to do their job.

They're getting paid to take someone's risk and then refusing to accept it.

Re: Is the world becoming uninsurable?

#686

Post by amarka »

lawlessone wrote: post #685

Obviously insurance companies, and i of course, would prefer if nobody anywhere ever had accidents or got sick etc And i'd love it every lottery ticket, and horse i ever bet on was a winner Feels like insurance companies just don't want to do their job. They're getting paid to take someone's risk and then refusing to accept it.

Not sure if this is accurate. It seems they’re refusing to take the risk.

Re: Is the world becoming uninsurable?

#687

Post by amonon »

doug_durham wrote: post #669
sandworm101 wrote: post #570

Earlier quoted context omitted.

Wildfires are not the problem. They happen all the time without causing billion-dollar insurance claims. Insurance is always assets x risk. The issue is expensive flamable housing (assets) in a wildfire area (risk). We ask for trouble when we create million-dollar wooden houses surrounded by manicured gardens in desert enviroments. And build on a slope facing pervailing winds. The answer is concrete/brick houses with…

That doesn't align with the reality of these areas. To get insurance in these areas you have to demonstrate that you have created a defensible space around your house. This is enforced by local fire department inspections. I know this because I live near a fire prone area. Despite these things the area still burned. The problem isn't "lawns" or "wooden houses". In the case of the LA fires you would have had the burne…

>This was a black swan event that will require a thoughtful response.

Taleb would have a field day with this one. Broadly, I think a big part of the argument is driven by the assumption that the area will be rebuilt, despite being a known fire risk.

Re: Is the world becoming uninsurable?

#688

Post by smileysteve »

infecto wrote: post #467
tobyhinloopen wrote: post #283

American, living in area prone to natural disasters: "Is the WHOLE WORLD becoming uninsurable?" The answer is obviously "no" since there are other parts of the world that don't live on a hurricane highway nor build houses made from firewood in an area prone to wildfires.

Honest question. Why when people describe wood framed homes do they always phrase it like houses made from "firewood", "sticks", "twigs" etc? It at least for me always detracts from the argument at hand. You could just as easily build a wood framed home with an exterior shell that is fire resistant using modern materials or brick.

Brick, stucco, concrete siding are all fire resistant and commonly used in construction in the last 25 years.

Insulation plays into combustability as well, where mineral / rock wool has thermal mass, does not ignite, but us construction has recently favored fiberglass and cellulose for the the costs.

Re: Is the world becoming uninsurable?

#689

Post by marcosdumay »

erikerikson wrote: post #619
marcosdumay wrote: post #575

Earlier quoted context omitted.

Hy from Brazil... You know, a poor country. We make single-level houses with a reinforced concrete structure, because it's cheap. You know what isn't cheap? Wood. Wood is incredibly expensive to put into a shape, even if you are willing to cut forests down to get it.

This was surprising because here in the US, concrete is expensive to build with. I'm considering a build and by far log homes seem my cheapest option.

Yes, people from the US always say concrete is expensive and wood is cheap. And unless you are designing a tent (by the way, zinc is way cheaper than wood for a tent), only people from the US say that.

There's something distorting your economy. Concrete is incredibly cheap as a material, extremely prone to use in a large supply chain, and requires way less labor than wood.

You make houses siting over finely built wood lattices... how much do you pay to the people building those? Because I can't imagine it being justifiable with Brazilian salaries.

Re: Is the world becoming uninsurable?

#690

Post by thrance »

danielmarkbruce wrote: post #621
thrance wrote: post #386

Earlier quoted context omitted.

When the cost of premium surpasses what people are able to pay, companies will just leave. That's the point of the article, you can only ignore material reality for so long.

The companies are leaving because of mandated price caps from the government. In every other market when cost > price and they can't control cost, companies increase price. You can only ignore the reality of government interference in the insurance market for so long.

I meant that at some point, with ever more costly and numerous disasters, the premium insurance companies would have to charge to be able to properly insure their clients would be too much for said clients to stomach, which would prevent anyone from getting anything insured. This has nothing to do with government interference. At some point the equation simply doesn't work anymore.
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