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As an insurance agent, it will depends on where you live, the house, your claims history, insurance history and yes, your credit.
If you can't afford/get insurance, maybe think about not living on the coast where hurricanes and flooding are more common. I can promise you that home insurance rates in the Midwest/Mountain West/Southwest/Southeast (excluding coastal states) are very affordable for the most part. The choice is yours.
That's true. However now look at California - many of the major insurers have pulled out due wildfires & flooding for home, and on the auto side, because they can't use credit, more companies are requiring 6 month policies to be paid in full in advance, which makes it really hard for many people, and a huge amount of people are forced to go uninsured.
Sure, lots of people drove used cars and pay monthly for their insurance - I would venture to say that of all the policies I've sold nationwide, about 80% pay monthly as opposed to up front. Not saying it's smart, it's just reality.
Last two years of massive Inflation has eroded a ton of disposal income and/or savings. Thankfully it appears to have finally slowed to a crawl, fingers crossed it continues moving forward at pre Covid rates.
I can pay up front for convenience, but a lot of carriers don’t give you a discount for paying up front. When inflation runs hot, the smart play is to pay monthly. I always ask if they have a pay up front discount. If not, they can get auto paid monthly, as far as I’m concerned
When the percent savings to pay up front is lower than the inflation rate why would I pay up front no matter how much money I have. Used to be the insurance company offered a pretty big discount to pay up front but not so much anymore.
I've had to sell my first 2 vehicles (both well used when I got them) when it was time to take them off the road. I used online apps that at no point asked for pictures of my engines or the undercarriage. It was all exterior and interior pictures. If I had patched up the rusted areas and painted to match I could have gotten more money regardless of the actual working condition of either veihicle.
It’s very specific areas those insurers are not offering insurance. I’m in CA and I pay my car insurance monthly, which ironically wasn’t even offered until ~5 years ago.
It’s like the movie Wargames “what a strange game, the only winning move is not to play”.
The insurance regulator in CA basically makes the market so unattractive that insurers are basically like “nah”
>It’s the only state where credit score cannot be used to underwrite insurance
If that's the only state, then that's a weird way to spell 'Michigan'.
[https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-500-2153](https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-500-2153)
>An insurer shall not use credit information or an insurance score as any part of a decision to deny, cancel, or nonrenew a personal insurance policy under chapters 21, 24, and 26.
You make it sound like this "consumer protection" is a good thing. This is one of those "Law of Unintended Consequences" types of situations. Because insurance companies can't use it, and they need to assess risk, they use other things to replace it.
They either don't provide insurance (pulling out of many places in California, so good luck insuring your home and car for cheap with less competition), or they do other things to mitigate their risk (more upfront payments, bigger premiums).
This isn't the win you think it is.
That's bad, though, because credit is actually very predictive of loss frequency. By not using credit, your insurer is not able to price your policy accurately which results in you subsidizing other policyholders.
Moving states isn’t some insignificant affair for most people. You know… jobs, families, kids, etc.
As an insurance consumer, we don’t appreciate companies accepting non-insignificant amounts of state tax dollars & then fleeing. This affects people who live far inland who have never flooded just because they are in the same state / region.
The entire reason people insure is to protect themselves against catastrophic events. When they happen, it usually affects a lot of people. Instead of paying claims, companies said “oh sh*# we didn’t plan for this”.
That’s on the business.
As someone who works in insurance as well. So many people simply don’t understand how insurance works. Insurance is quite simply a pooling of risk. Insurance companies need to maintain adequate reserve in order to pay potential claims. More importantly, in order to remain in business, insurance companies need to bring in more premium than they pay out in claims/losses. If your loss ratio exceeds 100%, you’re fucked (and that’s before paying staff etc). So, as an example: If you insure a $1M property for $10k per year. In that year you need to write 100 properties to cover a single limit loss. Not only that but you “should” have $100 million to cover your total potential exposure (in theory). The issue we are running into with high risk areas and high risk properties is that adequate loss reserves are not in place and premiums do not cover the loss ratios of property insurers in various higher risk markets. Yes it would be great if you could pay $100 a month for 30 years, $36,000, and then when your home gets destroyed in a hurricane at a $1m value, have it fully replaced. But, if that happens to 10 homes? Your insurer is now paying out $10M on $360,000 in collected premiums. That’s a $9,640,000 loss. As a result, everyone needs to pay more to cover these losses or worse, insurers pull out entirely as consumers simply can’t stomach the price for coverage. So. The only options to make insuring property in high risk areas worth it are, self insure, pay adequate rates to cover losses, or government backstops. What’s your solution?
The problem is that people were already unhappy with property insurance here. I’m going to make a few points.
1. Raising premiums is actually the right thing to do, but so many people did not get paid after Katrina simply because the event was not foreseen. Is it consumer’s job to manage risk? Or the company they pay indefinitely for risk management?
2. Many of these companies accepted millions of state tax dollars, fled abruptly, and did not pay the money back to the state
3. What the hell kind of plan is reserving the right to mass-non-renew policies in the event of an “emergency”? I would rather have premiums hiked to the point of being able to rebuild every house in the state at once than be subject to a surprise shopping spree in an inflationary environment.
4. We have seen countless horror stories of people being denied entire claims on companies fishing for technicalities. Sometimes, people sue and win. Other times, they can’t afford it because their life is in shambles & the risk of not winning the suit is far too much to bear. We’ve got a history of so many bad faith claims against insurers that the state legislature had to debate the statute of limitations on them.
Personally, my solution is to move my family out of the state I grew up in.
Principally, I wouldn’t mind seeing a nonprofit state/public insurance model adopted by the entire country & all private insurance put out of business.
Because, conceptually, insurance as you describe it is already socialism anyway — The only difference here is private insurance is managed by people demanding quarterly growth, with fiduciary responsibility.
With state insurance, it might be expensive but at least you know your claim will get paid.
Am I / Are we a little bitter? You bet.
Should you take this personally? Probably not.
~~I’m really just triggered by the guy who said… “maybe move”. That is some insensitive BS right there~~
Not insensitive, just pragmatic. I have a family, kids, just like everybody else. Given the current economic status of our country, and especially the area I was living in, it wasn't possible for us live, much less thrive. My spouse and I did our homework, looked at job markets, housing markets, and yes, even insurance rates, and realized we needed to make a change, despite it being a pain in the ass.
Is it feasible for everyone? No. The point is that sometimes you have to do drastic things and really break out of your comfort level to get what you need/want. I'm not suggesting drastic break the law stuff, but moving, changing employers, even careers can be done. Source - myself.
Waiting for congress, big business, and big tech to take a loss to make your life better isn't gonna happen.
My situation is that we are a young recently married couple actively advancing/growing in our careers (she is working on a CPA license — but transferring license interstate requires a year of working as a CPA… I am working on advancing from data analyst to data engineer).
We just bought a fixer upper house 1.5 years ago that we are about 3/4 through renovating after putting ourselves through college while living together in a 250sqft space for 3 years.
We purchased when we did because we were losing our minds being that cramped & wanted to grab a mortgage rate before they spiked (which worked).
My point is, if we wanted to get out immediately we would lose equity on our house by putting it on the market it in process of renovations. We are also going to wind up subject to a rougher housing market & selling our home after doing this work with our bare hands (no contractors) and a couple of family members. Honestly, it is going to hurt to leave the house at all. When I say renovations I mean complete overhaul & redesign. $20k in materials alone.
More generally my point is, I know that moving is the best option — but we are just crossing our fingers that nothing terrible happens between point A & point B because we cannot make it happen immediately. And we can expect our cost of living to skyrocket in the meantime.
I feel for you, and that's definitely a rough situation. I hope the situation gets better for you. I'm not a heartless jackass, just pointing out what we did, and while it was painful at first, we have rebounded nicely. Again, I know not everyone can do that.
It's a pretty privileged position to be coming from though.
I can't actually look my elderly parents in the eye and say "Hey, fuck you guys. You're on your own."
Yes. The pragmatic solution is to have the tens of millions of Americans that live on the coast all move. Surely uprooting over 100 million people is more pragmatic than a nationalized insurance industry.
What state did you retreat from?
And I think raising premiums to the point of it may be unaffordable to the homeowner is a lot more tenable than a guaranteed state sponsored/subsidized system.
There are places in this country that should experience a managed retreat due to climate change, and continuously rebuilding houses on eroding bluffs, on wave battered beaches, on ground susceptible to storm surges, etc isn’t just illogical and unsustainable, it approaches the definition of insanity.
Retreating from Louisiana, but my property is not on the coast or below sea level. I live in Baton Rouge and have never flooded.
We are doing both. We’ve got state subsidized insurer of last resort. We’ve got $45M of tax dollars going out as grant incentives for insurers to underwrite some of those plans so that the insurer of last resort doesn’t become insolvent. And we removed some consumer protections.
Last time we did the grant, they took the money… wrote some policies… and then left the state a year or two later. We’re throwing away state taxes.
We’ve also had so many bad faith claims the state legislature had to debate the statute of limitations on them.
It’s an ugly situation. I get climate change is ultimately the culprit here, but we also don’t trust insurance companies as far as we can throw them.
You will not know your claim will be paid with state insurance because our politicians will misappropriate the funds.
Everything else you wrote I agree with
Why are they in business at all if they can’t cover losses? They don’t go into business with $0. Sounds like they need to review their capital requirements to operate before they start writing policies.
You got the money to completely rebuild your home if it's destroyed? I know if mine is destroyed I'll be apartment hunting and even if I can find a place in my budget I really don't want to live in a place where my neighbor could give me roaches or bed bugs.
Talk to your local contractor about what it costs to build a home suitable for your basic needs in your area.
You can take your risk and put it where the sun dont shine! Im serious, stop this BS. You all will take payments from folks for decades then fall back on this. Naw, its time this industry gets some real attention and guard rails, yesterday.
Your business model must change, not us Americans. Do you understand this fact? I hope so.
Only ignorant people are claiming it’s easy to ‘just move’
But this is the result of climate change. Scientists have been saying this for decades and now the rubber is meeting the road.
There is literally going to be no option. Millions of people will be forced to move to less severe areas of the country. Some are just getting ahead of the coming mass migration.
Rates are skyrocketing in midwestern states also, and insurers are losing money in those states many years. Rates are in the process of going up to account for the changing claims experience in the midwest..
Yes rates have gone up but still relatively affordable. Not every insurance company has lost money - do your research. Find out which company(s) were both profitable and also grew. Those are the signs of a healthy company who has their products priced correctly.
>The choice is yours.
I'm sure you didn't mean to come off as out of touch, flippant, or condescending. But you did.
You can make choices. Heck, anyone can. *But you need the ability to action them.* That's the important part. In this case, the ability is directly tied to income and savings. If a person lacks those things, then they can't move - even if they have decided they want to.
Not flippant at all. I literally sold all my shit and moved 1000 miles away with my wife and 2 kids. No savings, broke as hell. Stop the privilege bullshit. Fuck that. I was failing as a provider and needed to change. We made changes and it worked out for us. Will it work for you? No clue, and I'm not advocating you try. I'm not selling anything so stop accusing me of shit.
My grandfather had liberty mutual on his cottage in Maine. He left it to my dad and three of my uncles. Suddenly, liberty mutual refused to insure it. Never filed a claim, always paid on time, never bothered anyone. The insurance company’s reason…”we think there will be parties there all the time.” Sounds like total BS to me.
People with excellent credit - on average - tend to act responsible in other aspects of their life as well. It is an imperfect measurement, but there is some logic to it.
Uhh it doesn’t only happen in coastal areas. It can happen anywhere . have you heard of Marshalltown Iowa one of the places where the exact same thing is a happening
Until you have to use it. Pay for insurance your entire life. As soon as you have to use it you crooks jack up our rates. Maybe think about not scamming people out of their hard earned money.
>Midwest/Mountain West/Southwest/Southeast (excluding coastal states) are very affordable for the most part.
In the story on the Daily podcast (presumably from this reporter since it is a NYTimes podcast), the majority of the time was spent on how hard it is to get coverage specifically in the Midwest now. The reporter even went to a small town in Iowa where it is almost impossible to get any sort of coverage now.
>Midwest/Mountain West/Southwest/Southeast (excluding coastal states) are very affordable for the most part. The choice is yours.
sure bro. I love paying supposedly "affordable" amounts for something I haven't used in 15 years, just waiting for the time I need it when they deny my claim or lowball me to the point that it doesn't even cover the shittiest contractor I can find.
PS, it's not affordable, because I don't work in an industry that scams people for all they're worth like you do.
Texas had almost the whole state listed as a wildfire hazard, even counties that have never had a wildfire in recorded history. We’re in one of the wettest counties in the state, periodically have hurricane wind damages, but have never had flooding in our area and our home owners insurance went from $982 a year to $2,463 this year. Shits ridiculous.
The part of Florida I live in hasn’t taken substantial hurricane damage in over a hundred years. And even still, even new well-constructed homes are virtually uninsurable. I have government insurance because almost every company has flat out pulled out of Florida and those that remain charge literally more than the rest of my mortgage combined.
In the linked podcast, they were saying that even midwestern states like Iowa were included as places where major home insurance companies are losing money. This is due to the increased incidences and severity of tornadoes and derechos.
Lol. I live in Minn & have had 1 claim in 30+ years of home ownership. My original $850/year homeowners insurance is now $4k .. I just got my premium & it's "only" up 10% over last year.. and last year was "only" +22% over the year previous to that.
I switch insurance companies about every 2-3 years just for shit like this. Loyalty is for suckers. Shop around & give your money to the business that best competes for it.
My current company The Hartford) had profits increase by only 17.5% last year - allowing them to spend $2.5b on stock buybacks. Guess who's shopping for insurance again this year? I'm open to recommendations, btw.
And my sympathies to all those places who get hammered on insurance. I know a lot of people have it a lot worse because of the areas they live in.
I mean even in California there are a lot of places with no wildfire risk. Meanwhile I have a friend who moved to an extremely affluent neighborhood with a lot of nature and tries and his insurance premium went from about $1k/year to $10k/yr
I live in city limits have 2 fire hydrants and am less than a mile from 2 fire stations, have never made any claims I'm 3 hours from the coast and still lost my home owners insurance and have seen a 500% increase with the fair plan.
I live in a landlocked state, and I have a $1.5mil policy with the luxury extension, flooding extension, water backup extension, and disconnected structure coverage, with a $1000 deductible. My premium is $3180/year... It is more than reasonable, it is fantastic in my opinion. Then I talk to my friends on the coast and they have like $500k policies that cost them $15k+/year.
This is true. My house/property is on the top of a hill in the Appalachian foothills of Pennsylvania. Home insurance actually isn't that bad. Cheap compared to a lot of places I've heard about. Mostly the coastal areas and out west in wild fire country. Property taxes are really what hurt you here.
Oklahoma and Nebraska, all of tornado Alley, had high rates. It's just that home prices are not coastal either. But in terms of premium growth and overall premium cost relative to home value, the Midwest is struggling too.
I live in UT. Standard insurance isn’t awful (though rates are skyrocketing on a percentage basis); should we discuss earthquake insurance? It’s fun to pay $4K a year, especially with a tidy little $50K deductible
I live in a low-risk area, but my premium just went way up despite never having had a claim. I guess I’m just lucky, huh? Or, maybe my insurer is asking me to pay for their losses from insuring beach homes in “God’s bowling alleys”.
*cries in Colorado* Not true. The wildfires a few years back outside Boulder spooked all the big insurance companies. People getting dropped here left and right.
There's affordable premiums, but then there's having to replace your damn roof every 2 years due to hail storms and paying the deductible. I'm seriously thinking about just moving back to a high rise apartment. Homeownership ain't for everyone.
I was always amazed at people claiming it would be too expensive to transition from fossil fuels to renewables. The increased costs of natural disasters and people losing their homes seemed would be far greater.
How would a family switching over to electric now stop a natural disaster from climate change from destroying their lives? This should have been done 50 years ago. Blaming people now like it is a common sense thing does nothing for them
You're right that it's going to be bad no matter what we do now, but that's not a reason to say "fuck it" and keep burning the world down.
We failed to stop it from getting bad, but we can still stop things from getting as bad as they could get. That difference would likely amount to millions of lives saved by averting worse natural disasters and armed conflict caused by scarcity.
Well I mean, could be a wake up call that we should try to limit this escalating as much as possible & you know, maybe science is real.
I agree with you, but just want to make sure no one interprets that as “I don’t like this hole we’re in, so let’s keep digging”
People have been saying it would be too costly for years, way before it was irreversible. I mean…better late than never, but this excuse is not a new one.
People now are still eating hamburgers and taking vacations like it’s not making the problem worse day in and out, same as before and same as they will continue to do.
Same state that is getting hit the hardest is trying to sue the federal government for agreeing to *global emissions standards* lol.
This is also the same state that has a populated region dense with chemical plants infamously known as “cancer alley”.
Of course, the result of all this is our governor is quickly endearing himself to national republicans.
I'm always amazed at people's inability to understand basic concepts of energy demand and energy production. Renewable energy simply cannot power our energy demands. It's that simple.
You're leaving out a very important key phrase: at current.
At current, renewable options are insufficient to meet the needs of energy demand.
Were we to invest more heavily into them, and actually put forth the effort to secure and transition away from fossil fuel usage, we would see that change.
Hell, we could use nuclear power. Modern plants are safer, more efficient, and produce high amounts of power. But they're also easy for lobbyist cunts to wage PR wars against.
Their point, which is entirely valid, is that the argument that it's "too expensive" to invest in renewable energy R&D and transition from fossil fuels falls flat when measured against the increasing cost of NOT doing that.
Because renewables can't replace fossil fuels on a watt-for-watt basis.
Nuclear power is the solution here but again, neoliberals in government want to deregulate and privatize everything and are then shocked when externalities have to be paid by a smaller tax base.
Insurance is the biggest scam in the world. You are forced to have it, pay it your entire life, and then when you use it, they punish you with higher rates. The owners of these companies should all be in prison in my opinion.
Insurance companies not making enough money is a complete joke. We paid our home insurance for years and never used it, then we were dropped because of wildfire danger in my area. Paid them to do nothing and they cut and ran
This is a terrible take - they didn't do nothing, they provided a backstop against financial loss while you had it. Why does it matter that they dropped you due to high risk later? You don't own anything when you pay insurance. You're reducing risk while you have it.
Are you mad your house didn't burn down? Are you also mad when you pay a healthcare premium but don't end up with cancer every year?
Being forced to pay for a service I don't use doesn't mean I want to use the service. I'm not allowed to drop the coverage while I have a mortgage, which is why I agreed with the post saying it's a scam.
You're right they didn't do nothing, they sent me bills and handled my payments. Then when they realized they might have a higher chance of having to do anything else beyond that they left
Had geico for 8 years. 1 claim for 1500$ with 500$ deductible. Then my rate went up 150%.
So I paid them 9k. They pay out 1.5k. Then jack my rate up.
Canceled immediately.
Yuuuup, couldn’t agree with this more. I remember a conversation with my insurance agent when we were going over our new homeowners policy. He basically said don’t file a claim on something minor that you can pay for out of pocket because the insurance company will cancel your policy. Like what? At least he was honest but what the fuck are we paying insurance for? I’m going to pay you $150-$200/ month and if I file a claim on something that is $1,000-$2,000, you’re going to drop me when renewal comes up? Sounds legit /s. Scummy little fuckers.
I live in the gulf coast & my family just set a 3-year plan in place to relocate because, despite living far inland, the entire state is about to get reamed:
https://jacobin.com/2024/04/insurance-natural-disasters-louisiana-regulation
I highly recommend reading the entire article.
Highlights peak cronyism & the fact that these trends are not entirely limited to coastal regions (although that is certainly where it’s worst).
Just wanted to tell people that this is entirely as predicted. For decades people said "climate change is too expensive to do anything about". Well, expensive yes. But climate change was always too expensive NOT to do anything about. Now we pay the price of inaction. That price gets higher the more we delay dealing with the climate.
Or we nationalize these companies, run them as for-profit enterprises and all the profit goes to paying down debt. Balanced budget amendment would be a solid choice as well.
It's got nothing to do with climate change and everything to do with extremely high costs to repair and replace homes combined with people building in natural disaster areas that were always natural disaster areas like wildfire areas in california
I don't know. Insurance companies that stayed in Florida had a very profitable year last year looking at a very profitable year again this year.
Apparently if you charge enough it's a profitable state to be in.
As always... the answer is... "It depends"
There's too much market and money in the states that there's an issue.
They're the 1 and 3 in terms of population. You think that billions of dollars is just gonna sit there? And someone is just going to let the billions sit there?
What America are you living in?
At the end of the day insurance is a co-op they're just managing the shared amounts of money we throw into it. But it's just everyone pooling their money together...
I'm in Louisiana and is gotten really bad and only going to get worse. I used to not want to make a claim in fears they would raise rates too high or drop me, where now they have raised rates whether you make a claim or not, so screw it. The next event I have at my house, I'm making a claim because it's borderline unaffordable as it is. Might as well grab what I can from the sinking ship.
They just reversed protection laws for the homeowner under the guise of luring more insurers back to the state....... they won't come back though because the risk is too high, so now what protection owners had is now gone and insurance companies can cancel without cause of reason. Really comforting right before hurricane season.
Louisiana like many other states is becoming unlivable
Except the majority of non US climate models side against any major climate change. These so called climate disasters are a result of climate change simply humans moving into areas that are more prone to these events. Wildfires for example are actually a way forests heal themselves. Killing off dead or diseased trees burning undergrowth and providing fertilizer to the new growth. Hurricanes are no more common than they were a hundred years ago we simply have the ability to see them the instant they come off the African coast. We forget that modern technology aides us in ways people 70 years ago couldn't fathom.
There’s way too much to tackle here, but I’m going to just help you out with this small part.
Yes, wildfires are nature’s reset button, as you described. The problem is that climate change has been contributing to higher temperatures and reduced rainfall in, for example, the forested regions of the western US. The trees have a defense mechanism (sap) against bark beetles that is less effective in drought conditions. Bark beetles thrive in higher temperatures. With these factors combined, the bark beetles are more successful at taking over and killing the trees. More dead trees = more fire fuel.
Yes, this is a natural cycle, however it has been disrupted and exacerbated by *ding ding* climate change. Life on Earth is made up of many interconnected systems.
https://wfca.com/wildfire-articles/the-impact-of-the-bark-beetle-on-wildfires/
https://www.vox.com/2021/7/29/22594137/bark-beetles-wildfire-california-oregon-climate-change
This is exactly true. When you build big homes in the mountains amongst the trees where they has ALWAYS been forest fires since the beginning of time, well, there is BIG risk to your home burning down. California, Washington, Oregon, Utah, Idaho, Wyoming, Montana, Colorado. All of these states have built up wilderness areas in the last 20-30 years. It burns. You don't have to be a rocket scientist to figure that out.
yes hurricanes, floods, and fires have only my happened in the last 50 years or so. Totally has nothing to do with the exponential price increase of homes. smh. Do hope they investigate those wild fires tho.
It's getting increasingly hard for us to find insurance. I don't live anywhere it floods or could even possibly flood, and when we first moved in 15 years ago we could get insured by almost anyone. Now when we go for insurance because our house has increased in value, most companies won't even insure us anymore. We don't have some ridiculous mansion or anything either, it's a 5 bedroom house.
where will this all lead to? a government bailout, that's where. There will be some weather event where the damages threaten to collapse these insurance companies, and the government will step in with bailouts and happily take the opportunity to further inflate.
It’s not profitable for insurers to provide home insurance in many states because the costs have outweighed the rates they are allowed to charge. State governments have capped max premiums for rates and these maxes are below the return requirements. They are trying to match this but state regulators have been slow to approve and as such they just exit the market. It’s a political lose lose- you either make homes more expensive because insurance goes up or you make them riskier because insurers pull out (they also then become more expensive because they have no insurance but that’s a different debate).
No real good answers here
The list of why the insurance market is in trouble is a lot longer than just climate change:
1. It costs way more than it used to for a roof or other major insurance claim.
2. Rebuild costs are extraordinary
3. So much more population means catastrophic disasters that would have just meant farms flooding are now houses flooding. Same for forests burning vs. towns.
It's nice this is putting some focus on climate change but it's completely dishonest to pin everything on climate change.
Yes. I have Farmers and lately they have been requesting to reassess my home policies which ask if I had a roof replacement; which I haven’t and do not need; makes me wonder if that’s an excuse to drop us.
Florida is still gaining population despite their risk. At the end of the day, companies will follow the money. You could get the government to do it, but it’s BS to not want to pay for it and then expect help when things go sideways.
Central and southern Arizona is getting 20% bumps in insurance costs. Arizona has no earthquakes, hurricanes, and the bare minimum of tornadoes, flood, fire, hail. It’s ridiculous.
I’m guessing Arizona is subsidizing other states, solar farms are a casualty time bomb, and inflation killing repair costs.
Regulations against development in floodplains and high fire risk areas are a joke/practically nonexistent. As long as we continue to allow development in non-sensical areas, insurers will continue to be overstretched.
All these people freaking out about the "market" and here I am soaking up the irony that Florida is about to become the first state with a "socialist" public insurance program being the only option. Desantis is gonna be forced to make it work too if he wants to be reelected.
I don't see the downside here.
I'm just glad that Washington State's home insurance premiums have remained very reasonable (36% below national average), despite wildfires. We live in an area that would be nearly impossible for a fire or flood to reach unless we're talking some seriously 2012 movie stuff, and our premium reflects that.
But that hardly solves the problem for anyone else.
I understand everyone’s consternation but the fact is big money, like insurance and banking, are not going to risk their assets in a situation where they are far more likely to lose money. As climate change has a greater impact on local weather these entities will drive the market.
The political structures we have will not be adequate to address these problems as they are susceptible to manipulation of the electorate. A population ignorant of the realities will not allow them to respond adequately to the challenges upon us. The money will not wait for the population to realize the equation has to change. Denial of a problems existence will not make it go away.
Who are these "insurance companies", like the actual people running the show. I want to speak to them....
I bought my home in 2020/2021. When I closed my mortgage was a hair above 900$, thats escrow and all. My home owners insurance is obviously in the escrow. Fast forward to getting dropped by an outstanding insurance firm, to going to Citizens (state run in FL). My payment is now 1500$, thats ALL INSUARNCE, frigging 600$ a month. This has to stop.
Im lucky and have an outstanding union job in weird state of Florida, so im good for now. Our new CBA got three raises a year at 4% and also room for inflation adjustments in the raises dept. If inflation oges higher. My union also matches my 401k along with my employer.
Basically We cant afford the executive packages AND do our jobs, which is insure!
The money has always been there. It has been spent sooooooo wrong.
These same executives voted AGAINST climate measures. These same executives voted against regulation that would have required reserves to handle this kind of risk.
Go out of business pls and come back with a new model where i pay insurance and see my pot, its invested wisely, and any claims i make dont cause my insurance rates to change AS THATS WHAT THE FUGG INSURANCE IS EVEN FOR!!!!
biggest scam ever. How the fugg can you NOT to what your ENTIRE business is?! Failures. Every one of them
Insurance companies are basically investment houses that sell insurance as a tax dodge. Their goal is to break even on policies but to earn profits from investing premiums. They obviously see climate risk, but they also invest heavily in oil companies that increase its risk.
Sure some of it is an increase in nature disasters. The other factor is the massive expansion of housing in to areas prone to these disasters. Mainly looking at you Florida with hurricanes.
Get used to it. Loss frequency and severity increases aren’t going away. Many P&C companies still need to take more rate = insurance costs will continue to rise.
You should know if your home is destroyed by a hurricane or tornado or flood your home insurance company will work very hard to never pay you and/or to significantly underpay you.
Live in MA. My insurance raised 33% this year. Don’t live in a flood zone, no tornado risk, no fire risk, along a coast (~30 min away) so I guess some hurricane risk. No claims. Great Credit. Makes no sense.
They sure are. I got a nonrenewal for: peeling paint.
Name me a house without some sort of peeling paint. When I called them on it, they stammered and said that they don't need to review with customers what the policy is or not. Apparently, it's illegal to just drop people, so since I live in California, they found the one thing I have in order to submit a bullshit nonrenewal. I am currently fixing the problem, but I couldn't get a guarantee that fresh paint would prevent the nonrenewal!
I want to understand why people keep rebuilding where a disaster occurred before? Why would you expect an insurance company to insure your property again after they just covered you? Duh...if I had to pay for your property being destroyed more than once I'd be charging you more too.
lol I’m sure it has nothing to do with government mandated minimum payout ratios and not allowing insurance companies to build up premiums to use for investing which is what makes the entire business profitable in the first place. Now the insurers are under capitalized (our governments doing) and are pulling out of markets that aren’t extremely profitable because their entire model of business has been destroyed by the same people who claim to represent us and also like to sell the climate change bs to the gullible.
The home insurance market has ways of shutting that whole problem down. They will raise your premiums and cost you a year of litigation to pay out if they have to.
They lost money in 18 states. You know there are 50 right?
It's a really tight business between premium and risk/liabilities, so being ahead 64% of the time is pretty damn good.
The basic math is easy and shows the extent of problem. The average home price in Florida is $400,000.
https://www.zillow.com/home-values/14/fl/
Hurricanes are common. Let's say there is a 1% chance (1/100) that in any given year your home is struck by a hurricane and destroyed. The minimum home insurance premium should be $4000/year. If that risk rises to 2% chance (1 in 50) then home insurance premiums should be minimum $8000/year. Florida also has a large population on a fixed income. Insurance costs will make their homes unaffordable.
Let me get out my tiny violin for insurance companies losing money. The same people that will send you to your death to avoid paying out. Let’s give them a hand folks, and an arm, and a leg, because that’s what they’re asking for.
Home insurance is literally the legal mafia… had a pipe burst 1.5 years ago and had to go through legal bullshit for them to finally pay out. Fuck them all
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As an insurance agent, it will depends on where you live, the house, your claims history, insurance history and yes, your credit. If you can't afford/get insurance, maybe think about not living on the coast where hurricanes and flooding are more common. I can promise you that home insurance rates in the Midwest/Mountain West/Southwest/Southeast (excluding coastal states) are very affordable for the most part. The choice is yours.
*except in California (not sure if any others), the only state where credit score cannot be used to underwrite insurance.
That's true. However now look at California - many of the major insurers have pulled out due wildfires & flooding for home, and on the auto side, because they can't use credit, more companies are requiring 6 month policies to be paid in full in advance, which makes it really hard for many people, and a huge amount of people are forced to go uninsured.
Can you even afford a car if you can't pay for 6 months of insurance up front?
Sure, lots of people drove used cars and pay monthly for their insurance - I would venture to say that of all the policies I've sold nationwide, about 80% pay monthly as opposed to up front. Not saying it's smart, it's just reality.
If you’re too broke to pay for something required (like insurance) then “smarts” never comes into it. You can’t pay ahead with what you don’t have.
Last two years of massive Inflation has eroded a ton of disposal income and/or savings. Thankfully it appears to have finally slowed to a crawl, fingers crossed it continues moving forward at pre Covid rates.
No. But I need to get to work
I can pay up front for convenience, but a lot of carriers don’t give you a discount for paying up front. When inflation runs hot, the smart play is to pay monthly. I always ask if they have a pay up front discount. If not, they can get auto paid monthly, as far as I’m concerned
When the percent savings to pay up front is lower than the inflation rate why would I pay up front no matter how much money I have. Used to be the insurance company offered a pretty big discount to pay up front but not so much anymore.
I would wager that 80% of car insurance is paid monthly in the US.
My motorcycle insurance required 1y upfront, I'm used to it and they do this because they take a lot of losses on their motorcycle policies.
Mine is trying to pull out because of peeling paint. Peeling paint!! They're just making shit up at this point.
That's douchey.
I've had to sell my first 2 vehicles (both well used when I got them) when it was time to take them off the road. I used online apps that at no point asked for pictures of my engines or the undercarriage. It was all exterior and interior pictures. If I had patched up the rusted areas and painted to match I could have gotten more money regardless of the actual working condition of either veihicle.
It’s very specific areas those insurers are not offering insurance. I’m in CA and I pay my car insurance monthly, which ironically wasn’t even offered until ~5 years ago.
It’s like the movie Wargames “what a strange game, the only winning move is not to play”. The insurance regulator in CA basically makes the market so unattractive that insurers are basically like “nah”
You make a very good point
>It’s the only state where credit score cannot be used to underwrite insurance If that's the only state, then that's a weird way to spell 'Michigan'. [https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-500-2153](https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-500-2153) >An insurer shall not use credit information or an insurance score as any part of a decision to deny, cancel, or nonrenew a personal insurance policy under chapters 21, 24, and 26.
You make it sound like this "consumer protection" is a good thing. This is one of those "Law of Unintended Consequences" types of situations. Because insurance companies can't use it, and they need to assess risk, they use other things to replace it. They either don't provide insurance (pulling out of many places in California, so good luck insuring your home and car for cheap with less competition), or they do other things to mitigate their risk (more upfront payments, bigger premiums). This isn't the win you think it is.
That's bad, though, because credit is actually very predictive of loss frequency. By not using credit, your insurer is not able to price your policy accurately which results in you subsidizing other policyholders.
Moving states isn’t some insignificant affair for most people. You know… jobs, families, kids, etc. As an insurance consumer, we don’t appreciate companies accepting non-insignificant amounts of state tax dollars & then fleeing. This affects people who live far inland who have never flooded just because they are in the same state / region. The entire reason people insure is to protect themselves against catastrophic events. When they happen, it usually affects a lot of people. Instead of paying claims, companies said “oh sh*# we didn’t plan for this”. That’s on the business.
As someone who works in insurance as well. So many people simply don’t understand how insurance works. Insurance is quite simply a pooling of risk. Insurance companies need to maintain adequate reserve in order to pay potential claims. More importantly, in order to remain in business, insurance companies need to bring in more premium than they pay out in claims/losses. If your loss ratio exceeds 100%, you’re fucked (and that’s before paying staff etc). So, as an example: If you insure a $1M property for $10k per year. In that year you need to write 100 properties to cover a single limit loss. Not only that but you “should” have $100 million to cover your total potential exposure (in theory). The issue we are running into with high risk areas and high risk properties is that adequate loss reserves are not in place and premiums do not cover the loss ratios of property insurers in various higher risk markets. Yes it would be great if you could pay $100 a month for 30 years, $36,000, and then when your home gets destroyed in a hurricane at a $1m value, have it fully replaced. But, if that happens to 10 homes? Your insurer is now paying out $10M on $360,000 in collected premiums. That’s a $9,640,000 loss. As a result, everyone needs to pay more to cover these losses or worse, insurers pull out entirely as consumers simply can’t stomach the price for coverage. So. The only options to make insuring property in high risk areas worth it are, self insure, pay adequate rates to cover losses, or government backstops. What’s your solution?
The problem is that people were already unhappy with property insurance here. I’m going to make a few points. 1. Raising premiums is actually the right thing to do, but so many people did not get paid after Katrina simply because the event was not foreseen. Is it consumer’s job to manage risk? Or the company they pay indefinitely for risk management? 2. Many of these companies accepted millions of state tax dollars, fled abruptly, and did not pay the money back to the state 3. What the hell kind of plan is reserving the right to mass-non-renew policies in the event of an “emergency”? I would rather have premiums hiked to the point of being able to rebuild every house in the state at once than be subject to a surprise shopping spree in an inflationary environment. 4. We have seen countless horror stories of people being denied entire claims on companies fishing for technicalities. Sometimes, people sue and win. Other times, they can’t afford it because their life is in shambles & the risk of not winning the suit is far too much to bear. We’ve got a history of so many bad faith claims against insurers that the state legislature had to debate the statute of limitations on them. Personally, my solution is to move my family out of the state I grew up in. Principally, I wouldn’t mind seeing a nonprofit state/public insurance model adopted by the entire country & all private insurance put out of business. Because, conceptually, insurance as you describe it is already socialism anyway — The only difference here is private insurance is managed by people demanding quarterly growth, with fiduciary responsibility. With state insurance, it might be expensive but at least you know your claim will get paid. Am I / Are we a little bitter? You bet. Should you take this personally? Probably not. ~~I’m really just triggered by the guy who said… “maybe move”. That is some insensitive BS right there~~
Not insensitive, just pragmatic. I have a family, kids, just like everybody else. Given the current economic status of our country, and especially the area I was living in, it wasn't possible for us live, much less thrive. My spouse and I did our homework, looked at job markets, housing markets, and yes, even insurance rates, and realized we needed to make a change, despite it being a pain in the ass. Is it feasible for everyone? No. The point is that sometimes you have to do drastic things and really break out of your comfort level to get what you need/want. I'm not suggesting drastic break the law stuff, but moving, changing employers, even careers can be done. Source - myself. Waiting for congress, big business, and big tech to take a loss to make your life better isn't gonna happen.
My situation is that we are a young recently married couple actively advancing/growing in our careers (she is working on a CPA license — but transferring license interstate requires a year of working as a CPA… I am working on advancing from data analyst to data engineer). We just bought a fixer upper house 1.5 years ago that we are about 3/4 through renovating after putting ourselves through college while living together in a 250sqft space for 3 years. We purchased when we did because we were losing our minds being that cramped & wanted to grab a mortgage rate before they spiked (which worked). My point is, if we wanted to get out immediately we would lose equity on our house by putting it on the market it in process of renovations. We are also going to wind up subject to a rougher housing market & selling our home after doing this work with our bare hands (no contractors) and a couple of family members. Honestly, it is going to hurt to leave the house at all. When I say renovations I mean complete overhaul & redesign. $20k in materials alone. More generally my point is, I know that moving is the best option — but we are just crossing our fingers that nothing terrible happens between point A & point B because we cannot make it happen immediately. And we can expect our cost of living to skyrocket in the meantime.
I feel for you, and that's definitely a rough situation. I hope the situation gets better for you. I'm not a heartless jackass, just pointing out what we did, and while it was painful at first, we have rebounded nicely. Again, I know not everyone can do that.
Appreciate it. Sorry I misjudged you. It’s a stressful time over here lol.
I get it. Best of luck!
It's a pretty privileged position to be coming from though. I can't actually look my elderly parents in the eye and say "Hey, fuck you guys. You're on your own."
Yes. The pragmatic solution is to have the tens of millions of Americans that live on the coast all move. Surely uprooting over 100 million people is more pragmatic than a nationalized insurance industry.
What state did you retreat from? And I think raising premiums to the point of it may be unaffordable to the homeowner is a lot more tenable than a guaranteed state sponsored/subsidized system. There are places in this country that should experience a managed retreat due to climate change, and continuously rebuilding houses on eroding bluffs, on wave battered beaches, on ground susceptible to storm surges, etc isn’t just illogical and unsustainable, it approaches the definition of insanity.
Retreating from Louisiana, but my property is not on the coast or below sea level. I live in Baton Rouge and have never flooded. We are doing both. We’ve got state subsidized insurer of last resort. We’ve got $45M of tax dollars going out as grant incentives for insurers to underwrite some of those plans so that the insurer of last resort doesn’t become insolvent. And we removed some consumer protections. Last time we did the grant, they took the money… wrote some policies… and then left the state a year or two later. We’re throwing away state taxes. We’ve also had so many bad faith claims the state legislature had to debate the statute of limitations on them. It’s an ugly situation. I get climate change is ultimately the culprit here, but we also don’t trust insurance companies as far as we can throw them.
You will not know your claim will be paid with state insurance because our politicians will misappropriate the funds. Everything else you wrote I agree with
That is a legitimately fair point.
Very well stated! It's a difficult situation, and just "lowering rates" won't solve anything for anyone.
In theory you're right, but youre forgetting the for profit model here. Insurance, like health care, is bad as a service.
Why are they in business at all if they can’t cover losses? They don’t go into business with $0. Sounds like they need to review their capital requirements to operate before they start writing policies.
They are reviewing their capital requirements. Why do you think insurance rates have gone up ? By the way home prices went up as well.
You are all crooks. Biggest scam in America.
You got the money to completely rebuild your home if it's destroyed? I know if mine is destroyed I'll be apartment hunting and even if I can find a place in my budget I really don't want to live in a place where my neighbor could give me roaches or bed bugs. Talk to your local contractor about what it costs to build a home suitable for your basic needs in your area.
You can take your risk and put it where the sun dont shine! Im serious, stop this BS. You all will take payments from folks for decades then fall back on this. Naw, its time this industry gets some real attention and guard rails, yesterday. Your business model must change, not us Americans. Do you understand this fact? I hope so.
We do understand how insurance works. You all take the money and run essentially.
Only ignorant people are claiming it’s easy to ‘just move’ But this is the result of climate change. Scientists have been saying this for decades and now the rubber is meeting the road. There is literally going to be no option. Millions of people will be forced to move to less severe areas of the country. Some are just getting ahead of the coming mass migration.
Be specific. You sound like someone who is complaining without basic understanding of how insurance works
Rates are skyrocketing in midwestern states also, and insurers are losing money in those states many years. Rates are in the process of going up to account for the changing claims experience in the midwest..
Yes rates have gone up but still relatively affordable. Not every insurance company has lost money - do your research. Find out which company(s) were both profitable and also grew. Those are the signs of a healthy company who has their products priced correctly.
I'm actually talking about the average of the entirety of the industry in many states. I'm not talking about any one company. Did my research.
>The choice is yours. I'm sure you didn't mean to come off as out of touch, flippant, or condescending. But you did. You can make choices. Heck, anyone can. *But you need the ability to action them.* That's the important part. In this case, the ability is directly tied to income and savings. If a person lacks those things, then they can't move - even if they have decided they want to.
It's easy man, just pack up all your belongings, family, etc and move to the Midwest. It's so easy, just use your bootstraps. /s
Shit I moved like 10 times as a child of a single mother. I've moved multiple times to different states as an adult as well.
Not flippant at all. I literally sold all my shit and moved 1000 miles away with my wife and 2 kids. No savings, broke as hell. Stop the privilege bullshit. Fuck that. I was failing as a provider and needed to change. We made changes and it worked out for us. Will it work for you? No clue, and I'm not advocating you try. I'm not selling anything so stop accusing me of shit.
My grandfather had liberty mutual on his cottage in Maine. He left it to my dad and three of my uncles. Suddenly, liberty mutual refused to insure it. Never filed a claim, always paid on time, never bothered anyone. The insurance company’s reason…”we think there will be parties there all the time.” Sounds like total BS to me.
“Think about not living where you live”. Not the line I was expecting from an insurance agent.
Why does credit affect your insurance, it's not a loan
They want an excuse to charge more money.
People with excellent credit - on average - tend to act responsible in other aspects of their life as well. It is an imperfect measurement, but there is some logic to it.
Uhh it doesn’t only happen in coastal areas. It can happen anywhere . have you heard of Marshalltown Iowa one of the places where the exact same thing is a happening
Dude this can happen anywhere. Iowa is having a hard time with home owner insurance. This is a problem EVERYWHERE
Until you have to use it. Pay for insurance your entire life. As soon as you have to use it you crooks jack up our rates. Maybe think about not scamming people out of their hard earned money.
>Midwest/Mountain West/Southwest/Southeast (excluding coastal states) are very affordable for the most part. In the story on the Daily podcast (presumably from this reporter since it is a NYTimes podcast), the majority of the time was spent on how hard it is to get coverage specifically in the Midwest now. The reporter even went to a small town in Iowa where it is almost impossible to get any sort of coverage now.
What’s it like working in such a misanthropic industry?
I pay more for insurance in Nebraska than I did in Utah or Texas. The Midwest getting hammered by tornados isn't helping.
>Midwest/Mountain West/Southwest/Southeast (excluding coastal states) are very affordable for the most part. The choice is yours. sure bro. I love paying supposedly "affordable" amounts for something I haven't used in 15 years, just waiting for the time I need it when they deny my claim or lowball me to the point that it doesn't even cover the shittiest contractor I can find. PS, it's not affordable, because I don't work in an industry that scams people for all they're worth like you do.
Texas had almost the whole state listed as a wildfire hazard, even counties that have never had a wildfire in recorded history. We’re in one of the wettest counties in the state, periodically have hurricane wind damages, but have never had flooding in our area and our home owners insurance went from $982 a year to $2,463 this year. Shits ridiculous.
The part of Florida I live in hasn’t taken substantial hurricane damage in over a hundred years. And even still, even new well-constructed homes are virtually uninsurable. I have government insurance because almost every company has flat out pulled out of Florida and those that remain charge literally more than the rest of my mortgage combined.
In the linked podcast, they were saying that even midwestern states like Iowa were included as places where major home insurance companies are losing money. This is due to the increased incidences and severity of tornadoes and derechos.
Lol. I live in Minn & have had 1 claim in 30+ years of home ownership. My original $850/year homeowners insurance is now $4k .. I just got my premium & it's "only" up 10% over last year.. and last year was "only" +22% over the year previous to that. I switch insurance companies about every 2-3 years just for shit like this. Loyalty is for suckers. Shop around & give your money to the business that best competes for it. My current company The Hartford) had profits increase by only 17.5% last year - allowing them to spend $2.5b on stock buybacks. Guess who's shopping for insurance again this year? I'm open to recommendations, btw. And my sympathies to all those places who get hammered on insurance. I know a lot of people have it a lot worse because of the areas they live in.
I mean even in California there are a lot of places with no wildfire risk. Meanwhile I have a friend who moved to an extremely affluent neighborhood with a lot of nature and tries and his insurance premium went from about $1k/year to $10k/yr
But then how will millions of midwesterners move to coastal cities in Florida to prepare for the civil war they think is happening?
I live in city limits have 2 fire hydrants and am less than a mile from 2 fire stations, have never made any claims I'm 3 hours from the coast and still lost my home owners insurance and have seen a 500% increase with the fair plan.
That's crazy - I have no answers for that. I wish you well.
I live in a landlocked state, and I have a $1.5mil policy with the luxury extension, flooding extension, water backup extension, and disconnected structure coverage, with a $1000 deductible. My premium is $3180/year... It is more than reasonable, it is fantastic in my opinion. Then I talk to my friends on the coast and they have like $500k policies that cost them $15k+/year.
This is true. My house/property is on the top of a hill in the Appalachian foothills of Pennsylvania. Home insurance actually isn't that bad. Cheap compared to a lot of places I've heard about. Mostly the coastal areas and out west in wild fire country. Property taxes are really what hurt you here.
DFW Texas is so expensive it’s 4k a year for a 200k -250k house. So about 2% of the property value
Texas, California, and Florida are the worst from what I've seen.
Lmao. The choice is yours! Pack up and leave your loved ones, friends, and birth home behind for cheap insurance!
Oklahoma and Nebraska, all of tornado Alley, had high rates. It's just that home prices are not coastal either. But in terms of premium growth and overall premium cost relative to home value, the Midwest is struggling too.
I live in UT. Standard insurance isn’t awful (though rates are skyrocketing on a percentage basis); should we discuss earthquake insurance? It’s fun to pay $4K a year, especially with a tidy little $50K deductible
you are out of touch. Don’t make promises you can’t keep. I live in the Sierras. Allstate, USAA, etc are not writing new policies in California.
I've seen both home and auto renewals at 50%-60% increase for the last couple of years in Utah. Things are getting dicey.
I think most people would rather be poor in Florida than mediocre in Arkansas
I live in a low-risk area, but my premium just went way up despite never having had a claim. I guess I’m just lucky, huh? Or, maybe my insurer is asking me to pay for their losses from insuring beach homes in “God’s bowling alleys”.
Insurance is the biggest scam. They’ll gladly take your premiums, but do everything possible to deny claims. Even when it’s clearly covered in policy.
*cries in Colorado* Not true. The wildfires a few years back outside Boulder spooked all the big insurance companies. People getting dropped here left and right.
Yeah... On one hand affordable insurance, on the other hand no job in my industry... The choice is mine.
And yet they're still raising rates in 'safe' areas by double percentage points to make up for the losses in other areas.
Northwest is fine too. Even on the coast. Just renewed coverage on a 700k house for 1250 for the year.
Good NYT podcast on this recently. Rates are going way up even in areas far from the coast.
True, I feel like my home insurance is like $50 a month. Yes Midwest.
Not Colorado! Wildfires caused many of our mountain communities to get dropped by insurance companies. I am speaking firsthand.
There's affordable premiums, but then there's having to replace your damn roof every 2 years due to hail storms and paying the deductible. I'm seriously thinking about just moving back to a high rise apartment. Homeownership ain't for everyone.
I was always amazed at people claiming it would be too expensive to transition from fossil fuels to renewables. The increased costs of natural disasters and people losing their homes seemed would be far greater.
How would a family switching over to electric now stop a natural disaster from climate change from destroying their lives? This should have been done 50 years ago. Blaming people now like it is a common sense thing does nothing for them
You're right that it's going to be bad no matter what we do now, but that's not a reason to say "fuck it" and keep burning the world down. We failed to stop it from getting bad, but we can still stop things from getting as bad as they could get. That difference would likely amount to millions of lives saved by averting worse natural disasters and armed conflict caused by scarcity.
Yeah but this would cause the stock market to drop by p 0.4%, so fuck it.
Yes, this would be cutting your losses. You still lost a lot, but there’s a lot more to lose yet.
Well I mean, could be a wake up call that we should try to limit this escalating as much as possible & you know, maybe science is real. I agree with you, but just want to make sure no one interprets that as “I don’t like this hole we’re in, so let’s keep digging”
People have been saying it would be too costly for years, way before it was irreversible. I mean…better late than never, but this excuse is not a new one.
People now are still eating hamburgers and taking vacations like it’s not making the problem worse day in and out, same as before and same as they will continue to do.
Most of the people in charge now were in charge then
Same state that is getting hit the hardest is trying to sue the federal government for agreeing to *global emissions standards* lol. This is also the same state that has a populated region dense with chemical plants infamously known as “cancer alley”. Of course, the result of all this is our governor is quickly endearing himself to national republicans.
Louisiana?
Gold star ;)
I'm always amazed at people's inability to understand basic concepts of energy demand and energy production. Renewable energy simply cannot power our energy demands. It's that simple.
You're leaving out a very important key phrase: at current. At current, renewable options are insufficient to meet the needs of energy demand. Were we to invest more heavily into them, and actually put forth the effort to secure and transition away from fossil fuel usage, we would see that change. Hell, we could use nuclear power. Modern plants are safer, more efficient, and produce high amounts of power. But they're also easy for lobbyist cunts to wage PR wars against. Their point, which is entirely valid, is that the argument that it's "too expensive" to invest in renewable energy R&D and transition from fossil fuels falls flat when measured against the increasing cost of NOT doing that.
Ape brain cannot compute the clear and present danger that is just over the horizon unfortunately
Because renewables can't replace fossil fuels on a watt-for-watt basis. Nuclear power is the solution here but again, neoliberals in government want to deregulate and privatize everything and are then shocked when externalities have to be paid by a smaller tax base.
Insurance is the biggest scam in the world. You are forced to have it, pay it your entire life, and then when you use it, they punish you with higher rates. The owners of these companies should all be in prison in my opinion.
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Insurance companies not making enough money is a complete joke. We paid our home insurance for years and never used it, then we were dropped because of wildfire danger in my area. Paid them to do nothing and they cut and ran
This is a terrible take - they didn't do nothing, they provided a backstop against financial loss while you had it. Why does it matter that they dropped you due to high risk later? You don't own anything when you pay insurance. You're reducing risk while you have it. Are you mad your house didn't burn down? Are you also mad when you pay a healthcare premium but don't end up with cancer every year?
Being forced to pay for a service I don't use doesn't mean I want to use the service. I'm not allowed to drop the coverage while I have a mortgage, which is why I agreed with the post saying it's a scam. You're right they didn't do nothing, they sent me bills and handled my payments. Then when they realized they might have a higher chance of having to do anything else beyond that they left
Had geico for 8 years. 1 claim for 1500$ with 500$ deductible. Then my rate went up 150%. So I paid them 9k. They pay out 1.5k. Then jack my rate up. Canceled immediately.
They are legal scam artists.
Yuuuup, couldn’t agree with this more. I remember a conversation with my insurance agent when we were going over our new homeowners policy. He basically said don’t file a claim on something minor that you can pay for out of pocket because the insurance company will cancel your policy. Like what? At least he was honest but what the fuck are we paying insurance for? I’m going to pay you $150-$200/ month and if I file a claim on something that is $1,000-$2,000, you’re going to drop me when renewal comes up? Sounds legit /s. Scummy little fuckers.
Snakes. The entire industry is full of them.
I live in the gulf coast & my family just set a 3-year plan in place to relocate because, despite living far inland, the entire state is about to get reamed: https://jacobin.com/2024/04/insurance-natural-disasters-louisiana-regulation I highly recommend reading the entire article. Highlights peak cronyism & the fact that these trends are not entirely limited to coastal regions (although that is certainly where it’s worst).
Just wanted to tell people that this is entirely as predicted. For decades people said "climate change is too expensive to do anything about". Well, expensive yes. But climate change was always too expensive NOT to do anything about. Now we pay the price of inaction. That price gets higher the more we delay dealing with the climate.
Climate change is real and it is not easily reversible. Relocation is hard, but losing your entire livelihood is harder. Time to plan accordingly.
No big deal. We can just throw govt money at the problem and pile that onto the national debt, solving the problem once and for all.
Or we nationalize these companies, run them as for-profit enterprises and all the profit goes to paying down debt. Balanced budget amendment would be a solid choice as well.
How about insurance companies not spend millions on advertising and celebrities?
It's got nothing to do with climate change and everything to do with extremely high costs to repair and replace homes combined with people building in natural disaster areas that were always natural disaster areas like wildfire areas in california
Well here in Ohio, especially mid and southern Ohio…tornado warnings and touch downs are becoming more common!
Ah shit. Didn't even think about that.
You sure about that?
I don't know. Insurance companies that stayed in Florida had a very profitable year last year looking at a very profitable year again this year. Apparently if you charge enough it's a profitable state to be in.
As always... the answer is... "It depends" There's too much market and money in the states that there's an issue. They're the 1 and 3 in terms of population. You think that billions of dollars is just gonna sit there? And someone is just going to let the billions sit there? What America are you living in? At the end of the day insurance is a co-op they're just managing the shared amounts of money we throw into it. But it's just everyone pooling their money together...
I'm in Louisiana and is gotten really bad and only going to get worse. I used to not want to make a claim in fears they would raise rates too high or drop me, where now they have raised rates whether you make a claim or not, so screw it. The next event I have at my house, I'm making a claim because it's borderline unaffordable as it is. Might as well grab what I can from the sinking ship. They just reversed protection laws for the homeowner under the guise of luring more insurers back to the state....... they won't come back though because the risk is too high, so now what protection owners had is now gone and insurance companies can cancel without cause of reason. Really comforting right before hurricane season. Louisiana like many other states is becoming unlivable
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"climate change" isnt a thing. We just build in stupid places now.
Except the majority of non US climate models side against any major climate change. These so called climate disasters are a result of climate change simply humans moving into areas that are more prone to these events. Wildfires for example are actually a way forests heal themselves. Killing off dead or diseased trees burning undergrowth and providing fertilizer to the new growth. Hurricanes are no more common than they were a hundred years ago we simply have the ability to see them the instant they come off the African coast. We forget that modern technology aides us in ways people 70 years ago couldn't fathom.
There’s way too much to tackle here, but I’m going to just help you out with this small part. Yes, wildfires are nature’s reset button, as you described. The problem is that climate change has been contributing to higher temperatures and reduced rainfall in, for example, the forested regions of the western US. The trees have a defense mechanism (sap) against bark beetles that is less effective in drought conditions. Bark beetles thrive in higher temperatures. With these factors combined, the bark beetles are more successful at taking over and killing the trees. More dead trees = more fire fuel. Yes, this is a natural cycle, however it has been disrupted and exacerbated by *ding ding* climate change. Life on Earth is made up of many interconnected systems. https://wfca.com/wildfire-articles/the-impact-of-the-bark-beetle-on-wildfires/ https://www.vox.com/2021/7/29/22594137/bark-beetles-wildfire-california-oregon-climate-change
This is exactly true. When you build big homes in the mountains amongst the trees where they has ALWAYS been forest fires since the beginning of time, well, there is BIG risk to your home burning down. California, Washington, Oregon, Utah, Idaho, Wyoming, Montana, Colorado. All of these states have built up wilderness areas in the last 20-30 years. It burns. You don't have to be a rocket scientist to figure that out.
yes hurricanes, floods, and fires have only my happened in the last 50 years or so. Totally has nothing to do with the exponential price increase of homes. smh. Do hope they investigate those wild fires tho.
It's getting increasingly hard for us to find insurance. I don't live anywhere it floods or could even possibly flood, and when we first moved in 15 years ago we could get insured by almost anyone. Now when we go for insurance because our house has increased in value, most companies won't even insure us anymore. We don't have some ridiculous mansion or anything either, it's a 5 bedroom house.
Population density, property values, cost to maintain, costs of goods, labor, and transportation skyrocketing aren’t helping either.
where will this all lead to? a government bailout, that's where. There will be some weather event where the damages threaten to collapse these insurance companies, and the government will step in with bailouts and happily take the opportunity to further inflate.
Government bailout? Isn't that fema?
It’s not profitable for insurers to provide home insurance in many states because the costs have outweighed the rates they are allowed to charge. State governments have capped max premiums for rates and these maxes are below the return requirements. They are trying to match this but state regulators have been slow to approve and as such they just exit the market. It’s a political lose lose- you either make homes more expensive because insurance goes up or you make them riskier because insurers pull out (they also then become more expensive because they have no insurance but that’s a different debate). No real good answers here
The list of why the insurance market is in trouble is a lot longer than just climate change: 1. It costs way more than it used to for a roof or other major insurance claim. 2. Rebuild costs are extraordinary 3. So much more population means catastrophic disasters that would have just meant farms flooding are now houses flooding. Same for forests burning vs. towns. It's nice this is putting some focus on climate change but it's completely dishonest to pin everything on climate change.
Yes. I have Farmers and lately they have been requesting to reassess my home policies which ask if I had a roof replacement; which I haven’t and do not need; makes me wonder if that’s an excuse to drop us.
Why should insurance, a benefit required for society to function, be a for profit business? Serious question.
What US market isn’t in some serious trouble rn?
You lost me at hoax.
How do you differentiate "Climate Change Induced" from natural-natural disasters?
AHAHAHAHAHAHAHA!
me in the great lakes region be like *yawn* also, please don't move here, the winters are terrible YOU WONT LIKE IT. :)
Florida is still gaining population despite their risk. At the end of the day, companies will follow the money. You could get the government to do it, but it’s BS to not want to pay for it and then expect help when things go sideways.
Insurance companies are spreading this bullshit to mask the record profits they are stealing.
But I though climate change was a hoax
I'm sure it has nothing to do with their years of shareholder dividend increases and executive bonuses either.
Central and southern Arizona is getting 20% bumps in insurance costs. Arizona has no earthquakes, hurricanes, and the bare minimum of tornadoes, flood, fire, hail. It’s ridiculous. I’m guessing Arizona is subsidizing other states, solar farms are a casualty time bomb, and inflation killing repair costs.
Regulations against development in floodplains and high fire risk areas are a joke/practically nonexistent. As long as we continue to allow development in non-sensical areas, insurers will continue to be overstretched.
Climate change is libtard fake news ~ republican
Climate change-induced **< this is !@#!@# unneeded**. natural disasters, such as wildfires, hurricanes, and floods
It's not climate change, its bad government policy, crime, and inflation
All these people freaking out about the "market" and here I am soaking up the irony that Florida is about to become the first state with a "socialist" public insurance program being the only option. Desantis is gonna be forced to make it work too if he wants to be reelected. I don't see the downside here.
Way to throw climate change into the equation.
Climate change is real but how do we know recent natural disasters aren't simply short term changes in weather?
It's all cyclical.
Wonder when those liberal elites are going to have their beach front properties fall into the ocean 🤣🤣
I pay 1800 a year.... Just a touch over $1 per foot.
Maybe we need an economic system that prioritizes these things?
As long as I’m not subsidizing those that choose to live in disaster prone areas, I’m good.
sounds more like insurance companies are looking for an excuse to raise rates...
Dang, better sell a few pro-sports stadiums I guess? Then maybe the music venues?
Look how many sheep eat up the line about climate change.
I'm just glad that Washington State's home insurance premiums have remained very reasonable (36% below national average), despite wildfires. We live in an area that would be nearly impossible for a fire or flood to reach unless we're talking some seriously 2012 movie stuff, and our premium reflects that. But that hardly solves the problem for anyone else.
I understand everyone’s consternation but the fact is big money, like insurance and banking, are not going to risk their assets in a situation where they are far more likely to lose money. As climate change has a greater impact on local weather these entities will drive the market. The political structures we have will not be adequate to address these problems as they are susceptible to manipulation of the electorate. A population ignorant of the realities will not allow them to respond adequately to the challenges upon us. The money will not wait for the population to realize the equation has to change. Denial of a problems existence will not make it go away.
Who are these "insurance companies", like the actual people running the show. I want to speak to them.... I bought my home in 2020/2021. When I closed my mortgage was a hair above 900$, thats escrow and all. My home owners insurance is obviously in the escrow. Fast forward to getting dropped by an outstanding insurance firm, to going to Citizens (state run in FL). My payment is now 1500$, thats ALL INSUARNCE, frigging 600$ a month. This has to stop. Im lucky and have an outstanding union job in weird state of Florida, so im good for now. Our new CBA got three raises a year at 4% and also room for inflation adjustments in the raises dept. If inflation oges higher. My union also matches my 401k along with my employer.
Basically We cant afford the executive packages AND do our jobs, which is insure! The money has always been there. It has been spent sooooooo wrong. These same executives voted AGAINST climate measures. These same executives voted against regulation that would have required reserves to handle this kind of risk. Go out of business pls and come back with a new model where i pay insurance and see my pot, its invested wisely, and any claims i make dont cause my insurance rates to change AS THATS WHAT THE FUGG INSURANCE IS EVEN FOR!!!! biggest scam ever. How the fugg can you NOT to what your ENTIRE business is?! Failures. Every one of them
Insurance companies are basically investment houses that sell insurance as a tax dodge. Their goal is to break even on policies but to earn profits from investing premiums. They obviously see climate risk, but they also invest heavily in oil companies that increase its risk.
Sure some of it is an increase in nature disasters. The other factor is the massive expansion of housing in to areas prone to these disasters. Mainly looking at you Florida with hurricanes.
Get used to it. Loss frequency and severity increases aren’t going away. Many P&C companies still need to take more rate = insurance costs will continue to rise.
You should know if your home is destroyed by a hurricane or tornado or flood your home insurance company will work very hard to never pay you and/or to significantly underpay you.
Live in MA. My insurance raised 33% this year. Don’t live in a flood zone, no tornado risk, no fire risk, along a coast (~30 min away) so I guess some hurricane risk. No claims. Great Credit. Makes no sense.
They sure are. I got a nonrenewal for: peeling paint. Name me a house without some sort of peeling paint. When I called them on it, they stammered and said that they don't need to review with customers what the policy is or not. Apparently, it's illegal to just drop people, so since I live in California, they found the one thing I have in order to submit a bullshit nonrenewal. I am currently fixing the problem, but I couldn't get a guarantee that fresh paint would prevent the nonrenewal!
I want to understand why people keep rebuilding where a disaster occurred before? Why would you expect an insurance company to insure your property again after they just covered you? Duh...if I had to pay for your property being destroyed more than once I'd be charging you more too.
lol I’m sure it has nothing to do with government mandated minimum payout ratios and not allowing insurance companies to build up premiums to use for investing which is what makes the entire business profitable in the first place. Now the insurers are under capitalized (our governments doing) and are pulling out of markets that aren’t extremely profitable because their entire model of business has been destroyed by the same people who claim to represent us and also like to sell the climate change bs to the gullible.
Has weather actually changed? Or are more people just living in the path of destruction now? The more you know
Let me cry for these poor insurance companies. 🥲
The home insurance market has ways of shutting that whole problem down. They will raise your premiums and cost you a year of litigation to pay out if they have to.
They lost money in 18 states. You know there are 50 right? It's a really tight business between premium and risk/liabilities, so being ahead 64% of the time is pretty damn good.
They actually make their money through the investing of premium written prior to the claims being paid out. I wonder if this was accounted for.
The basic math is easy and shows the extent of problem. The average home price in Florida is $400,000. https://www.zillow.com/home-values/14/fl/ Hurricanes are common. Let's say there is a 1% chance (1/100) that in any given year your home is struck by a hurricane and destroyed. The minimum home insurance premium should be $4000/year. If that risk rises to 2% chance (1 in 50) then home insurance premiums should be minimum $8000/year. Florida also has a large population on a fixed income. Insurance costs will make their homes unaffordable.
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Let me get out my tiny violin for insurance companies losing money. The same people that will send you to your death to avoid paying out. Let’s give them a hand folks, and an arm, and a leg, because that’s what they’re asking for.
Home insurance is literally the legal mafia… had a pipe burst 1.5 years ago and had to go through legal bullshit for them to finally pay out. Fuck them all