Is the world becoming uninsurable? • Hacker News Board

Re: Is the world becoming uninsurable?

#851

Post by RevEng » Fri, Jan 17, 2025, 9:05 PM UTC

danielmarkbruce wrote: post #782

thrance wrote: post #690

Earlier quoted context omitted.

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.

It still won't cause that. People will own less expensive things if the all in cost of owning them goes up. This is econ 101. People buy cheaper houses when interest rates go up and vice versa.

Tell that to people who can't even afford rent. Some goods are inelastic because people need them at any price. Housing prices are good example of that. This is also econ 101.

Re: Is the world becoming uninsurable?

#852

Post by SJC_Hacker » Fri, Jan 17, 2025, 9:13 PM UTC

bee_rider wrote: post #695

blharr wrote: post #641

Earlier quoted context omitted.

Tornados might be more intense but only for a short period of time and in a small area. I don't see any of those where the tornado is lasting days, causing sustained damage. There are some where there are multiple tornadoes in a span, but each individual tornado is itself quick and violent but localized within a mile or so at most. Compare some incidents with, Hurricane Sandy, for example, where it traveled across th…

Yes. Tornadoes seem like a phenomenon for which insurance is actually a pretty good part of the solution. I mean, it is very unlikely for anything in particular to get hit by a tornado, but it is really devastating. It might take an unreasonable amount of work to build everything to the level where it can sustain a direct hit by a tornado. The expected value of tornado damage is quite low overall, we just need to dea…

You can build houses which are much less likely to be seriously damaged in a hurricane. Some more ambitious designs are virtually hurricane proof. You never see high rises knocked over by a hurricane, for instance. Because they are (mostly) built correctly. Otherwise downtown areas in the entire Gulf Coast, Mid-Altantic, would simply not have existed for more than a few decades.

The same goes for floods. Most of the problem with floods, is that the house frame and flooring are made of wood. And wood rots. If you live in a flood prone area, the first floor at least, should be brick or stone for just about everything. Yes its expensive. But so is is $800/month flood insurance. Or having the federal government bail you out and passing the cost on to the taxpayer

But building things correctly is more expensive, and Americans love their cheap McMansions.

Also, on an individual level there is less incentive to build correctly, because you will almost certainly not get a discount on insurance. 99% of the population is at the whim of either buying a used house, or whatever the builder's models are for new construction. Its really only possible if you are very wealthy and build your own house on your own plot.

Re: Is the world becoming uninsurable?

#853

Post by whatever1 » Fri, Jan 17, 2025, 9:16 PM UTC

fuzzfactor wrote: post #850

whatever1 wrote: post #58

No it’s just that the insurance companies want mandated insurance pools for which they just receive checks. In health insurance they don’t cover the elderly, and until Obama they did not cover people with prior conditions. For home insurance they don’t cover flood get your are mandated to carry one if you have a mortgage. In life insurance they do not cover you if you have a disease. It’s more like a lottery rather t…

Some people have always been uninsurable. When you become uninsurable yourself, all you're doing is crossing an imaginary line that has always been there, and kept in imaginary condition precisely to insure that your mental health is stable enough to keep on paying more than anything else :\ You're not supposed to notice this. Whether or not you crossed that line due to any fault of your own, or from the line moving…

If ship owners with hundreds of millions in assets cannot fight them, who can?

Re: Is the world becoming uninsurable?

#854

Post by rattlesnakedave » Fri, Jan 17, 2025, 9:17 PM UTC

pclmulqdq wrote: post #561

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…

As the governments in the US get increasingly incompetent, insurance prices are going to have to rise. Government services are largely there to protect you during black swan events, so if those services get less and less effective, you're going to need more insurance for those events.

These aren’t black swan events. These are swan events, if anything.

Re: Is the world becoming uninsurable?

#855

Post by Gigachad » Fri, Jan 17, 2025, 9:17 PM UTC

hintymad wrote: post #792

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.

Do we know why the insurance companies can't simply raise the insurance price to match the risks in those areas that are prone to natural disasters? I mean in general, not as in California where the government imposes strange policies. Speaking of the policy, why wouldn't California allow the insurance company raise the premium by region? Doesn't such policy benefit the rich at the cost of the poor as the rich love t…

If your house burning down was a near certainty within a few decades, the real cost of insurance would be buying a new house + profit margin.

Insurance only really works when most people don’t suffer a catastrophic event and can cover the few who do.

Re: Is the world becoming uninsurable?

#856

Post by KerrAvon » Fri, Jan 17, 2025, 9:17 PM UTC

WalterBright wrote: post #768

doug_durham wrote: post #669

Earlier quoted context omitted.

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…

> Despite these things the area still burned. I suspect the rules for making a defensible house were wrong. For example, I read an article recently that posited that most of the fire was spread by burning embers on the wind, and not by intense heat from nearby flames. The idea is to look at where embers accumulate and eliminate or fireproof those areas. For example, a low masonry wall a few feet from the house can st…

Sure, but that's how it already works. The airplane example is how building codes generally work. London didn't rebuild in wood after the Great Fire, to give an ancient, and large-scale, example.

From what I've read, the houses in LA that did survive were modern or heavily remodeled houses incorporating recent code changes to prevent embers from entering the eaves and suchlike.

It really doesn't help that most of LA was built up in the early to mid 20th century; requiring code updates during remodels can only help so much, because if the cost/change is too much/invasive the homeowners either don't remodel at all or do it without permits, bypassing the more costly safety improvements.

Re: Is the world becoming uninsurable?

#857

Post by marcosdumay » Fri, Jan 17, 2025, 9:18 PM UTC

ewhanley wrote: post #769

marcosdumay wrote: post #565

Earlier quoted context omitted.

It's so interesting to see the people in awe of that "fire hurricane" video in L.A.... We had a way more intense drought than they in my city last year (theirs are not that intense). We also had 50 km/h winds. We also had higher temperatures... And all of those to levels that we never saw before. Also, we have more trees in our cities. We had new "fire hurricane" videos every week (normally, every other year somebody…

It's not a competition. Both can be sights that people view in awe. Are you "Four Yorkshiremen-ing" wildfires?

Look, the annual fire disasters in California are not a normal thing.

If people just point out it's not normal, people complain that nowhere else has fire so nobody else understands the problem. If people point out similar places, looks like it's "Four Yorkshiremen-ing" (whatever that is). So, yeah, let it keep burning, whatever.

Re: Is the world becoming uninsurable?

#858

Post by throw0101c » Fri, Jan 17, 2025, 9:21 PM UTC

horsawlarway wrote: post #551

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…

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…

> Hurricanes are mostly just flood damage in the US, and some wind/debris damage exactly like the blown over trees you mention.

The insurance companies have done research on the topic (including building giant 'labs' with a large number of fans)

* https://fortifiedhome.org/research/

and have developed standards/techniques that home builders/owners can do to fix a bunch of problems, starting with roofing:

* https://fortifiedhome.org

* https://fortifiedhome.org/wp-content/uploads/2020-FORTIFIED-...

* https://www.youtube.com/watch?v=Zd-0yAPs6Wc

* https://www.youtube.com/watch?v=proGT6AtyJc

Re: Is the world becoming uninsurable?

#859

Post by currymj » Fri, Jan 17, 2025, 9:22 PM UTC

alistairSH wrote: post #725

tetromino_ wrote: post #606

Earlier quoted context omitted.

Hurricanes usually don't affect the structure of a house. They might damage the roof, parts of exterior cladding, perhaps windows, and the flooding which accompanies hurricanes destroys personal possessions, interior furnishing, electrical wiring, and appliances. In the US, manual labor is very expensive, home construction or repair is highly regulated and requires permits and multiple inspections from the local gove…

It sounds like we're quibbling over the definition of "destroyed"... if a home is rendered uninhabitable for days/weeks/months, I'd consider that "destroyed" even if the framing is in fact salvageable. And certainly as it relates to insurance, the trend sure seems to be well on it's way towards "coastal Florida is insurable" (either the price goes up beyond the means of the residents, or the insurers leave the market…

adaptation to hurricane winds has largely been done in many parts of Florida; adaptation to storm surge is possible and some cities are beginning to.

the issue for Florida is that the state is made of permeable limestone, so it’s not possible to engineer around sea level rise. not so much an insurance issue exactly though, because it’s not a one-off disaster.

Re: Is the world becoming uninsurable?

#860

Post by s1artibartfast » Fri, Jan 17, 2025, 9:23 PM UTC

_DeadFred_ wrote: post #831

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…

Why is the answer not Japan's approach. My understanding is that because of high incidents of natural disaster they see/build homes as transient and utilitarian rather than as long-lasting investments.

Partially because that story about Japan is incorrect.

In reality, it is Japanese condos that get gutted periodically or when sold, and it's driven by their real estate tax code.

Japan takes enormous effort to prevent and mitigate natural disasters.

There may have been some truth to it 200 years ago, with the idea that wood was the only economical way to build a house that could last.