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Your idea doesn't seem to be thought through -- who ensures the insurance companies are solvent enough to pay out? How do you deal with irreversible damage? Why

Your idea doesn't seem to be thought through -- who ensures the insurance companies are solvent enough to pay out? How do you deal with irreversible damage? Why invest a ton of energy into figuring out the right risk calculations for shoddy work rather than say, "This passes the threshold of really unsafe, don't do it". It's so much simpler, cheaper, and easier to understand to just draw a few lines in the sand. No amount of compensation can bring someone back if they've been lost to a fire, a deck collapse, a sinkhole, an electrical issue, etc. The use of lead paint causes irreversible damage to nervous tissue, and lead contamination can lie undetected in soils for years after a property removes all the lead from the buildings. Why would we want to invest a massive amount of effort into figuring out, e.g., the actual insurance risk of poorly built structures rather than saying, "No, you cannot use highly flammable plastic cladding on your highrise." Especially if insurance companies can go bankrupt or refuse to pay out. How do victims get made well if the insurance company refuses to pay on some technicality? The last thing I want to deal with is more insurance companies.

londons_explore 6y ago
> Why would we want to invest a massive amount of effort into figuring out, e.g., the actual insurance risk of poorly built structures rather than saying, "No, you cannot use highly flammable plastic cladding on your highrise." Wouldn't the insurance company say the same thing? Or rather they would say "we won't insure that thing". Which amounts to "You cannot build that thing if insurance is a requirement".
- Pfhreak 6y ago
  So now you have a widely distributed system of insurers to deal with making the rules, rather than people I've elected to represent my interests? (Even if said elections don't always go my way.) Who are those insurers beholden to, what are their incentives to represent the consumer in any way?
  - mikem170 6y ago
    I don't mean to imply that this invalidates your reasoning, but I thought it would be interesting to point out that Underwriters Laboratories was a private organization funded by insurance companies and did, and still does, a great job making electrical systems safer. Some people would like to see more things like that.
  - AnthonyMouse 6y ago
    > Who are those insurers beholden to, what are their incentives to represent the consumer in any way? Their incentives to represent the consumer are rooted in the fact that the consumer can switch to another insurance company. Which means that if one has overly strict requirements without charging correspondingly lower premiums, nobody will use them. Then you get the incentives you want: People prefer both lax requirements and low premiums and the insurance companies have the incentive to find a better balance than competing insurance companies.
    - Pfhreak 6y ago
      > Their incentives to represent the consumer are rooted in the fact that the consumer can switch to another insurance company. Two follow ups: 1) Isn't this inefficient? E.g. insurance is most efficient the larger the pool is. Doesn't this system introduce inefficiencies (and therefore risk) into the market? 2) Do you feel like there are adequate tools to choose between different insurers today, and do you expect that everyone who owns or improves property should be reasonably expected to make an informed decision about which insurance company to go with? It's hard enough now to insure my car, let alone all the individual decisions that go into building a house. (From materials to design decisions to occupancy rates to the health of the occupants, etc.)

londons_explore 6y ago

> Why would we want to invest a massive amount of effort into figuring out, e.g., the actual insurance risk of poorly built structures rather than saying, "No, you cannot use highly flammable plastic cladding on your highrise." Wouldn't the insurance company say the same thing? Or rather they would say "we won't insure that thing". Which amounts to "You cannot build that thing if insurance is a requirement".

Pfhreak 6y ago
So now you have a widely distributed system of insurers to deal with making the rules, rather than people I've elected to represent my interests? (Even if said elections don't always go my way.) Who are those insurers beholden to, what are their incentives to represent the consumer in any way?
- mikem170 6y ago
  I don't mean to imply that this invalidates your reasoning, but I thought it would be interesting to point out that Underwriters Laboratories was a private organization funded by insurance companies and did, and still does, a great job making electrical systems safer. Some people would like to see more things like that.
- AnthonyMouse 6y ago
  > Who are those insurers beholden to, what are their incentives to represent the consumer in any way? Their incentives to represent the consumer are rooted in the fact that the consumer can switch to another insurance company. Which means that if one has overly strict requirements without charging correspondingly lower premiums, nobody will use them. Then you get the incentives you want: People prefer both lax requirements and low premiums and the insurance companies have the incentive to find a better balance than competing insurance companies.
  - Pfhreak 6y ago
    > Their incentives to represent the consumer are rooted in the fact that the consumer can switch to another insurance company. Two follow ups: 1) Isn't this inefficient? E.g. insurance is most efficient the larger the pool is. Doesn't this system introduce inefficiencies (and therefore risk) into the market? 2) Do you feel like there are adequate tools to choose between different insurers today, and do you expect that everyone who owns or improves property should be reasonably expected to make an informed decision about which insurance company to go with? It's hard enough now to insure my car, let alone all the individual decisions that go into building a house. (From materials to design decisions to occupancy rates to the health of the occupants, etc.)