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Is the world becoming uninsurable?

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Re: Is the world becoming uninsurable?

#881

Post by mym1990 »

bluedevil2k wrote: post #8

Like we see in California, when the government sets a price ceiling, insurance companies just leave. Same in Florida. If the free market truly was allowed run normally, the insurance rates in Pacific Palisades or on the Florida coast would be so high that no one could afford to live there. Is that a bad thing? If someone was living in a house near where they tested missiles, we'd call them crazy. At what point can we…

Its interesting because the last 5 years in the US have seen a dramatic appreciation in housing prices, and also a seeming rise of risk of catastrophic events, and insurance companies are grappling with these 2 things. Ultimately maybe different insurance products could be provided that effectively offload some or all of the risk to the home buyer(which obviously is a not a good scenario for banks giving mortgages).

Re: Is the world becoming uninsurable?

#882

Post by hintymad »

dlcarrier wrote: post #868
KerrAvon wrote: post #800

Earlier quoted context omitted.

It's more complicated than that, as always. Here's some (incomplete) background on Florida: https://www.civilbeat.org/2024/03/how-floridas-home-insuranc... Re: California, I don't understand the context for your question, or why you would think the California government is more strange than any other US state government. There's no universally-accepted "ideology of California." It's a big state with a huge, diverse p…

California's insurance policies are more strange, due to proposition 103, passed in 1988. It creates a condition where the state can prohibit insurers from selling to residents, if it doesn't like their prices, which has recently lead to a lot of insurers no longer selling in the state, as construction prices in the state have risen significantly faster than inflation, leading to insurance premiums that the state doe…

> Residents who no longer have any insurers available can buy insurance from the state, but its far more expensive than the plans it rejected from private insurers

Sounds like a state-run racketeering business

Re: Is the world becoming uninsurable?

#883

Post by swiftcoder »

lores wrote: post #385
swiftcoder wrote: post #346

Earlier quoted context omitted.

I don't know about that. The Iberian peninsula is not historically at much risk for natural disasters, and we now suffer alternating forest fires and floods pretty much every year...

I remember forest fires yearly in northern Spain in the 80s. Are they more violent now?

Mostly they seem to have planted a lot more Eucalyptus, which makes the fires worse. The severe floods on the other hand seem to be catching everyone by surprise.

Re: Is the world becoming uninsurable?

#884

Post by SilasX »

Aurornis wrote: post #72
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…

> 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 companies are fabricating everything I have the exact same experience when discussing anything insurance related: People have wild assumptions about how much profit insurance companies a…

>When you point out that, for example, health insurance profits are low single digit percentage of overall healthcare costs they just don’t believe it.

It's not that I don't believe it, it's that this figure is completely unrelated to the damage and waste caused by the system of healthcare and health insurance we have in the US.

I mean, in a system of chattel slavery, you see above-normal profits competed away, but that in no way means the system isn't exploiting anyone, because that's not how the harm shows up! And yet still we'd see that argument get batted around in comments like yours:

"No, your owner can't possibly be exploiting you because, when you consider your purchase cost, he doesn't actually make much profit!"

Re: Is the world becoming uninsurable?

#885

Post by deaddodo »

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.

> nor build houses made from firewood in an area prone to wildfires.

The alternative is to build quadruple-the-price houses out of brick in an area prone to earthquakes.

It's much easier to repair/replace the former. And theoretically would be easier to avoid, if the fed would clean up the brush wood in their land (or give it back to the state, so they can manage it).

Re: Is the world becoming uninsurable?

#886

Post by petsfed »

epolanski wrote: post #459
spicyusername wrote: post #456

Earlier quoted context omitted.

Building out of wood is cheap and perfectly strong for most areas. Engineering is always a set of trade-offs.

I don't get how can one put his own future in a cheaply built building you're one fire or thougher-than-usual natural event away from losing. It's normal nobody wants to insure such risky assets, especially as nominal value of this wooden crap is stellar due to the skewed demand/offer ratio plaguing good parts of US. In my life I've seen my and my family's real estate being hit by a tree, fire, floodings and I've nev…

This is less like "well, I could get the $10 pants and have to replace them in a few months, or the $70 pants and have them last a decade" sort of cheap, and more the "well, I've been saving a mortgage down-payment for 15 years in the top 30% of individual wage earners, and this is the best built house I can afford" kind.

The options are either pay more for this one thing than literally any other possession you or anyone you know will ever own, or live in a tent or worse.

I feel like criticizing people for pragmatism in the face of (literally) existential threats is some kind of next-level privilege.

Re: Is the world becoming uninsurable?

#887

Post by bialpio »

kylehotchkiss wrote: post #756
infecto wrote: post #467

Earlier quoted context omitted.

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.

I don’t understand the sense of entitlement towards every nuclear family owning a building constructed with stone, steel, and concrete. None of these things are available in a level of abundance to grant them to every person alive. While concrete only construction is more common in developing countries I certainly question the quality. I lived in an apartment like this in South Asia and it had no weather insulating a…

It helps with availability of materials if people don't expect to have like 500sqft per person. But that's not how modern houses are built in US, at least not in my neck of the woods (Seattle suburbs). As for the quality of housing, I'm from ex-Soviet satellite state and lived in a prefab apartment block - yeah, it was a bit dated but no major problems with quality that I could tell. The main nuisance was lack of acoustic insulation.

Re: Is the world becoming uninsurable?

#888

Post by dlcarrier »

hintymad wrote: post #882
dlcarrier wrote: post #868

Earlier quoted context omitted.

California's insurance policies are more strange, due to proposition 103, passed in 1988. It creates a condition where the state can prohibit insurers from selling to residents, if it doesn't like their prices, which has recently lead to a lot of insurers no longer selling in the state, as construction prices in the state have risen significantly faster than inflation, leading to insurance premiums that the state doe…

> Residents who no longer have any insurers available can buy insurance from the state, but its far more expensive than the plans it rejected from private insurers Sounds like a state-run racketeering business

No, it's likely running at a loss.

Re: Is the world becoming uninsurable?

#889

Post by bombcar »

woah wrote: post #773
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.

Public insurance would provide no benefit. The issue in California is that people have built their houses in dangerous areas and have not taken any measures to reduce fire risk. The state has already set limits to how much insurance costs can be increased (from a past generation of economic illiterates who wanted to stop "middlemen siphoning value"). Therefore, insurance companies are just pulling out, which disprove…

The danger of the areas has not been properly accounted for, and now that we have a better understanding, nobody wants to pay what it actually costs (either in increased insurance, which apparently CA has limited, or building design changes - knock down the flammable one and build something impervious, or even abandoning untenable locations - perhaps after disaster, perhaps before).

Everyone's talking about fire insurance, but the earthquake insurance question is even bigger and basically untenable in a worst-case scenario. So in that case, CA wised up and the state is much more earthquake resilient than it was 30 years ago.

Re: Is the world becoming uninsurable?

#890

Post by bgnn »

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…

Most new houses built like that in a lot of places in Europe. Prefab reinforced concrete load-bearing walls + pourous concrete for the rest. It's either stucco or one layer of brick on the outside to give character to the building.
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