Home insurers are dropping customers based on aerial images

Now you frame this like I am too high risk or people in this capacity are too high risk, but that is the whole problem. Insurance cos are inconsistently making these determinations and the state's governance is directly responsible for the lack of regulation and enforcement. Nothing in my area has changed, but the insurance company has enacted the equivalent of ex post facto evaluation due to the state of CA. As example, my roof in great condition, passed inspection when purchase property a few years ago. I don't have certificates or invoices for repairs done to it in the 50 years of my home's life because I've only owned the property for a few years. The insurance company canceled my insurance stating I refused to provide such an invoice. They also claimed I'm now in a dangerous fire zone (I'm not) which I wasn't a year ago. They also claimed to need invoice of repairs for my plumbing, which again, is in wonderful condition. They stated simply providing inspection receipts wouldn't cut it and expensive certificates were needed. Anyways, I doubt you will read this but it's ridiculous and I'm not the only one in this state going through it.

So is mine. But my premise is that the true risk (that is, what uncertainty cannot be eliminated with sufficient information about the current state physical universe) is small, most of the apparent risk is just insufficient current data or an insufficient model; things like the drone data gathering are an attempt to narrow the first problem, and the second will improve over time with scientific progress.

As those improve, the expected loss converges toward the actual loss (and does so at any given proximity on progressively shorter timelines.)

The evidence I’d look for is something like their revenue vs payout over maybe the last 5 years?

I think a lot of this stuff can be very unintuitive, because we look around, and everything seems fine, and nothing seems to have changed, but they’re operating at a bulk statistical level, and their models revised on recent trends are probably telling them that they can’t profitably insure you for the amounts they’re allowed to charge. Some of that is that labor to rebuild/replacement cost has gotten much more expensive (we see that in our insurance rate changes despite being in an area with very little catastrophic risk).

And CA politicians’ response is probably some crowd pleasing but ultimately harmful “you can’t profiteer off our people, you’re not allowed to raise rates more than 3%” or something. So the only winning move becomes not to play except in the areas where you can make that work.

It does sound like they were just trying to find a way that they could cancel your policy without getting in trouble with the state insurance commission, though I don’t know enough about insurance to say if/why they’d need to.

You don't have to get a mortgage to live. You can save up and pay cash, or you can rent. Or you can pay the higher premiums that reflect your actual risk.

> Things like fire danger risk tend to change after the home is built as new data comes in.

In which case this is a different class of insurance that you could buy if you wanted it. You wouldn't be insuring against fire, you'd be insuring against the risk of your property value going down to reflect higher fire insurance premiums if the fire risk goes up. But why should you be forced to buy that type of insurance if you don't want it, or have it priced into everyone else's fire insurance premiums?

And regardless of that, why should someone who buys their house after the fire risk is known to be high be subsidized by everyone else?

> Health insurance isn’t implemented that way, as you acknowledge, exposing folks to exactly that risk.

It isn't implemented that way because of regulations, but the issue is what kind of regulations there should be. The existing regulations are extremely inefficient -- Americans pay more for healthcare/insurance than any other country, regardless of whether the other country has a public or private healthcare system.

A person with borderline intellectual functioning can absolutely have capacity to understand a contract sufficiently to agree with it when its terms are explained to them in clear plain English, yet lack the same capacity when they are presented in dense legalese. Legal doctrines of "capacity" tend not to deal with that situation very well, because they focus on the capabilities of one of the parties rather than the form in which the contract is presented. Also, a lot of people with mild cognitive issues (not just borderline IQ, also other issues like age-related cognitive decline, early stage dementia, early stage hepatic encephalopathy, etc) are unaware of those issues, in denial about them, or too ashamed to admit them, so may not benefit from legal rules designed to apply to them specifically, whereas they can stand to benefit from legal rules (like demanding unexpected clauses to be stated prominently to be enforceable) designed to apply to everybody.