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Just a PSA: home insurance companies have been dropping fire coverage in CA so quickly now that there's a state-mandated stay to prevent them from doing it for

Just a PSA: home insurance companies have been dropping fire coverage in CA so quickly now that there's a state-mandated stay to prevent them from doing it for a year. No word what the plan is after the stay but I would be cognizant of any insurance plans that you get.

asdff 6y ago
At some point we need the federal government to step in to provide wildfire insurance a la federal flood insurance. It will have to be reworked for CA considering the flood insurance only goes up to 250k.
- nsm 6y ago
  Or we could incentivize people not to live in places with wildfire risk by NOT offering insurance (with some sort of graded phase-out for people already living there).
- kansface 6y ago
  The federal government should not subsidize people to live in places so risky that private insurers refuse to offer coverage.
  - lotsofpulp 6y ago
    Don’t worry, California and other states with wildfire risk are not swing states so there’s not much chance of something similar to the NFIP being created.
nostrademons 6y ago
My sense is that the folks buying $2M+ homes in the Bay Area or $1M+ homes in Tahoe have enough money in the bank that they could just rebuild in cash on the off chance that their home gets burned down. At that price point you're largely paying for the land. Cheap structures (which abound in Tahoe) can be built for ~$250K, while even a really fancy 4000+ square foot mansion in Los Altos can be built for < $1M. Most of the mid-level FAANG employees and ex-startup/growth folks easily have that much in liquid assets.
- TomVDB 6y ago
  You’d be wrong. It’s pretty easy to find prime plots of land in the Tahoe area for less than $250k. The problem is building: there is a shortage of construction labor (they can’t afford to live in the area anymore), and the building season is short. Building cost per square footage is higher than in the Bay Area, often exceeding $600/sq.ft.

asdff 6y ago

At some point we need the federal government to step in to provide wildfire insurance a la federal flood insurance. It will have to be reworked for CA considering the flood insurance only goes up to 250k.

nsm 6y ago
Or we could incentivize people not to live in places with wildfire risk by NOT offering insurance (with some sort of graded phase-out for people already living there).
kansface 6y ago
The federal government should not subsidize people to live in places so risky that private insurers refuse to offer coverage.
- lotsofpulp 6y ago
  Don’t worry, California and other states with wildfire risk are not swing states so there’s not much chance of something similar to the NFIP being created.

nostrademons 6y ago

My sense is that the folks buying $2M+ homes in the Bay Area or $1M+ homes in Tahoe have enough money in the bank that they could just rebuild in cash on the off chance that their home gets burned down. At that price point you're largely paying for the land. Cheap structures (which abound in Tahoe) can be built for ~$250K, while even a really fancy 4000+ square foot mansion in Los Altos can be built for < $1M. Most of the mid-level FAANG employees and ex-startup/growth folks easily have that much in liquid assets.

TomVDB 6y ago
You’d be wrong. It’s pretty easy to find prime plots of land in the Tahoe area for less than $250k. The problem is building: there is a shortage of construction labor (they can’t afford to live in the area anymore), and the building season is short. Building cost per square footage is higher than in the Bay Area, often exceeding $600/sq.ft.