Is the world becoming uninsurable? • Hacker News Board

Re: Is the world becoming uninsurable?

#801

Post by brightball » Fri, Jan 17, 2025, 7:23 PM UTC

LeifCarrotson wrote: post #700

horsawlarway wrote: post #551

Earlier quoted context omitted.

Hurricanes are mostly just flood damage in the US, and some wind/debris damage exactly like the blown over trees you mention. Houses generally aren't destroyed by hurricanes in the sense of "the storm literally ripped them up", they're made uninhabitable by storm surges (flood). The scary ones are tornados. And tornados do genuinely fuck shit up. Even in those "enlightened" parts of the world you think have proper bu…

The real problem is that we're politically/socially unwilling to transfer the risk to the people who are responsible for creating it: Wealthy coastal landowners believe that the cost of home insurance should be about $2000/year. If their properties actually cost $200,000 per year to insure, then that's what they should have to pay! If they don't like it, they should either build something cheaper (that's the other ha…

I talked to somebody who owned a beach house in South Carolina about 5 years ago and if he wanted flood insurance it would cost $5,000 / month.

Re: Is the world becoming uninsurable?

#802

Post by mr_toad » Fri, Jan 17, 2025, 7:23 PM UTC

kranke155 wrote: post #549

yulaow wrote: post #517

Earlier quoted context omitted.

I never understood this. We build in Europe, over earthquake-risk zones, with bricks and steel and we follow rules to make them earthquake resistant. It is not a problem anymore since like the 1980. We now have also methods to make old and very old brick buildings earthquake resistant without demolishing them

What? What earthquake zone in Europe is similar to the fault lines in California? We are talking about entire cities wiped out by earthquakes just 120 years ago.

There’s a plate boundary running under Morocco and across the Mediterranean, but it’s not nearly as active as the Pacific Rim, and it’s quite a long way from Northern Europe.

Re: Is the world becoming uninsurable?

#803

Post by forgotmysn » Fri, Jan 17, 2025, 7:23 PM UTC

niemandhier wrote: post #415

simianparrot wrote: post #400

Earlier quoted context omitted.

> To be fair we are talking about an area of the country that is prone to seismic activity, it does limit the building materials. Japan comes to mind as a country that's solved this. > Where does LA get most of its water? Local sources? I don't think that's the case. Relevant: https://www.latimes.com/california/story/2025-01-10/as-flame...

Sure Japan did it, so did Mexico. The latter is probably much more important as an example for the US. https://www.preventionweb.net/news/not-drill-how-1985-disast...

Mexico is in the middle of a crippling drought

Re: Is the world becoming uninsurable?

#804

Post by Cypher » Fri, Jan 17, 2025, 7:24 PM UTC

I'll insure you for cost + half... it's not a matter of insurance it's the price of which it comes in at.

Re: Is the world becoming uninsurable?

#805

Post by bruce511 » Fri, Jan 17, 2025, 7:26 PM UTC

hallway_monitor wrote: post #639

wrfrmers wrote: post #635

Earlier quoted context omitted.

Public insurance. For housing, healthcare, maybe even cars (since the coprorate political complex insists that we HAVE to drive everywhere). At some point, we have to accept that the middlemen are siphoning value, not providing any. Vanguard it and let elected admins set the codes.

It does seem like it's time to stop letting this "industry" profit off the misfortune of its customers. Making all of these a public service instead of private industry makes sense at this point.

Ironically they don't profit off the misfortunate customers. Those ones typically get back more than their premiums.

They profit off the fortunate customers, those who have no need to claim from insurance.

Re: Is the world becoming uninsurable?

#806

Post by mr_toad » Fri, Jan 17, 2025, 7:28 PM UTC

adrianN wrote: post #364

CalRobert wrote: post #345

Earlier quoted context omitted.

Seems like having the ocean at your door would be bad for the structure? Or burning down in a hot dry period…

Why would a city like London or Paris burn down in a hot dry period?

London is at much more risk of flooding. Parts of London were built on wetlands not much above sea level, and there’s a big river running right through the middle.

Re: Is the world becoming uninsurable?

#807

Post by [deleted] » Fri, Jan 17, 2025, 7:31 PM UTC

rewgs wrote: post #197

epistasis wrote: post #57

Earlier quoted context omitted.

I've been trying to talk to people locally, a place with lots of homes built in the woodland-urban interface, about the risks of climate change and how insurance will have to change. Unfortunately these discussions almost never go well, because it seems that most people have at best a surface level understanding of what insurance is and how it works, and everyone is convinced that it's a full scam and insurance compa…

Insurance should not be for profit, and things like e.g. State Farm suddenly cancelling people's renters/fire insurance just two weeks before the fires (I am one of those people) are what people hate about insurance. No one is arguing that insurance is bad at risk assessment, but rather how they wield their proficiency with it.

[deleted]

Re: Is the world becoming uninsurable?

#808

Post by phendrenad2 » Fri, Jan 17, 2025, 7:31 PM UTC

Good. Building houses in tsunami-prone areas, areas downstream of large dams, and in known forest fire areas is stupid and insurance companies get to be the little boy who says "the emperor has no clothes" first.

Re: Is the world becoming uninsurable?

#809

Post by waveBidder » Fri, Jan 17, 2025, 7:35 PM UTC

mempko wrote: post #794

LeifCarrotson wrote: post #700

Earlier quoted context omitted.

The real problem is that we're politically/socially unwilling to transfer the risk to the people who are responsible for creating it: Wealthy coastal landowners believe that the cost of home insurance should be about $2000/year. If their properties actually cost $200,000 per year to insure, then that's what they should have to pay! If they don't like it, they should either build something cheaper (that's the other ha…

The real issue is global warming causing an exponential rise in tail risk events. It's exponential because even a linear shift in temperature causes an exponential rise at the tails (look at how a normal distribution works). Insurance is based on statistics. The math they use assumes stationary distributions. Insurance companies can't deal with shifting distributions well so they take the losses and then exit markets…

This is mostly a probability nitpick:

Most disasters follow power laws and other fat tail which don't have the same effects in the tail as a Gaussian. If you shift 1/x^a by c, you "only" get a polynomial increase.

But also, if you shift the mean of a Gaussian, the increase isn't exponential, it's super exponential (e^(x^2) to be specific).

> Insurance is based on statistics. The math they use assumes stationary distributions. Insurance companies can't deal with shifting distributions well so they take the losses and then exit markets.

Sure they can, that's why they hire statisticians. They routinely deal with insurance of much rarer events where we have much worse models than climate change. They're just banned from charging the actual rates, because it's politically unacceptable.

Re: Is the world becoming uninsurable?

#810

Post by talldrinkofwhat » Fri, Jan 17, 2025, 7:37 PM UTC

njovin wrote: post #646

HacklesRaised wrote: post #343

Earlier quoted context omitted.

To be fair we are talking about an area of the country that is prone to seismic activity, it does limit the building materials. Perhaps what should be more commonly accepted is that the US is a land of great natural beauty! And large tracts of it should be left to nature. What's the average monthly leccy bill in Phoenix during the summer? $400? Where does LA get most of its water? Local sources? I don't think that's…

There's plenty of water for Californians in California + The Colorado River. The problem is that our government has spent ~100 years ensuring that corporations have easier and cheaper access to it so that they can grow feed for farm animals to sell overseas , largely to places like UAE that have sufficiently depleted their own water table as to make it impossible to grow alfalfa, thus worsening the risk of droughts f…

Hey I'm trying to alleviate this issue from a technical standpoint and am trying to find others to join me. It's no cure-all, but the other paths would upend a century of legal precedence. Shoot me a PM if you're looking for work.