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The point about managing when fires happen is a good one. Reducing fire overlaps frees up resources. Still I don't see public responsibility for people who bu

The point about managing when fires happen is a good one. Reducing fire overlaps frees up resources. Still I don't see public responsibility for people who buy homes in fire-prone areas; that should be a private cost (insurance).

alex_young 6y ago
If we’re going to draw a distinction between homes in and out of fire prone areas, maybe we shouldn’t let people build them in the danger zone in the first place.
- EarthLaunch 6y ago
  Fire risk is a gradient, possible to price but impossible to be certain about. If someone wants to build on a volcano let them, and let them pay for it.
  - Zenbit_UX 6y ago
    OK but let's pretend that volcano has a really nice view of the ocean, and a super stable climate all year round! All of a sudden that one crazy guy building a home there becomes thousands, they become millions. Now let's give this volcano a name, something random like "California". At what point can the "if someone wants to build on California, just let them" be squared away against the inevitable humanitarian disaster of thousands of displaced families in our hypothetical location? At what point does the government step in and say: we'll the first guy was dumb, but we let him do it, then other followed and now we have thousands and thousands and can't ignore it anymore.
    - dodobirdlord 6y ago
      Well, step 1 in any scenario where the government is essentially forced to bail out a group if something goes wrong is to force the members of the group to pay for appropriate insurance. Alignment of incentives is essential. People who live in wildfire prone areas should be required to hold adequate fire-related disaster insurance that the government will, on not, not spend money subsidizing their poor decision making. This may make it financially unviable for many of those people to remain in those places, which is good and an intended effect. An interesting related example is Federal Deposit Insurance. The Great Depression made clear to the Federal government that deposits had to be insured against bank failure or nobody would ever trust banks to hold savings again and the banking system would never recover. So it introduced a mandatory insurance system that all banks would pay into to insure the deposits of any bank that failed.
      - teruakohatu 6y ago
        Here in New Zealand homes are not required to be insured, but all home insurance plans are required to pass on a levy to the government, which will cover the first $150,000 worth of earthquake damage. Insurers are only liable for an amount more than that, which the average home is unlikely to exceed given our building standards. If your home is not insured (with a private insurer) the government says they will not help you financially after an earthquake. California could do the same, but I suspect there would be protests from people living in low fire zones, while here in NZ pretty much everywhere is at risk of earthquakes.
- tengbretson 6y ago
  It's also possible to develop home building techniques that are resilient to fires.
chongli 6y ago
I can't see how insurance companies wouldn't simply exclude fire-damage from fire-prone areas in their policies. It would be crazy not to, given the risk of large numbers of simultaneous claims. I would even speculate that insurance companies have teams of specialized actuaries who model fire risk all over the place and use that to shape the policies they offer. To not do that would be either foolish or nefarious (in the case of an insurance company with no plan other than to declare bankruptcy in the event of a catastrophic fire).
- EarthLaunch 6y ago
  That makes sense in high risk areas, which makes the private cost the whole house rather than the insurance.
davidbanham 6y ago
I assume you're located in the US? I don't know how your system works over there but here in Australia it's a bit of a hybrid. Most of the fire service's funding is taken from the private insurance industry then the rest is taken from governments. [1] 1. https://www.fire.nsw.gov.au/page.php?id=48#funding https://www.fire.nsw.gov.au/page.php?id=48#funding
imglorp 6y ago
Good point about private insurance. Market forces might sort that one out. The other coin is public. FEMA bails out people who built in risky storm and flood zones like New Orleans. At the very least, I feel FEMA should be a one-time thing, if you insist on rebuilding in the same place, the government shouldn't be there for you again next flood.
- lumost 6y ago
  The reason for federal flood insurance is the “100 year flood”. As major floods are correlated private insurance struggles not to simply go bust. Given that most buildings are built for 30-40 year spans, forcibly rebuilding once per century can be done economically. The problems arise when hundred year floods become 10-30 year floods.

alex_young 6y ago

If we’re going to draw a distinction between homes in and out of fire prone areas, maybe we shouldn’t let people build them in the danger zone in the first place.

EarthLaunch 6y ago
Fire risk is a gradient, possible to price but impossible to be certain about. If someone wants to build on a volcano let them, and let them pay for it.
- Zenbit_UX 6y ago
  OK but let's pretend that volcano has a really nice view of the ocean, and a super stable climate all year round! All of a sudden that one crazy guy building a home there becomes thousands, they become millions. Now let's give this volcano a name, something random like "California". At what point can the "if someone wants to build on California, just let them" be squared away against the inevitable humanitarian disaster of thousands of displaced families in our hypothetical location? At what point does the government step in and say: we'll the first guy was dumb, but we let him do it, then other followed and now we have thousands and thousands and can't ignore it anymore.
  - dodobirdlord 6y ago
    Well, step 1 in any scenario where the government is essentially forced to bail out a group if something goes wrong is to force the members of the group to pay for appropriate insurance. Alignment of incentives is essential. People who live in wildfire prone areas should be required to hold adequate fire-related disaster insurance that the government will, on not, not spend money subsidizing their poor decision making. This may make it financially unviable for many of those people to remain in those places, which is good and an intended effect. An interesting related example is Federal Deposit Insurance. The Great Depression made clear to the Federal government that deposits had to be insured against bank failure or nobody would ever trust banks to hold savings again and the banking system would never recover. So it introduced a mandatory insurance system that all banks would pay into to insure the deposits of any bank that failed.
    - teruakohatu 6y ago
      Here in New Zealand homes are not required to be insured, but all home insurance plans are required to pass on a levy to the government, which will cover the first $150,000 worth of earthquake damage. Insurers are only liable for an amount more than that, which the average home is unlikely to exceed given our building standards. If your home is not insured (with a private insurer) the government says they will not help you financially after an earthquake. California could do the same, but I suspect there would be protests from people living in low fire zones, while here in NZ pretty much everywhere is at risk of earthquakes.
tengbretson 6y ago
It's also possible to develop home building techniques that are resilient to fires.

chongli 6y ago

I can't see how insurance companies wouldn't simply exclude fire-damage from fire-prone areas in their policies. It would be crazy not to, given the risk of large numbers of simultaneous claims. I would even speculate that insurance companies have teams of specialized actuaries who model fire risk all over the place and use that to shape the policies they offer. To not do that would be either foolish or nefarious (in the case of an insurance company with no plan other than to declare bankruptcy in the event of a catastrophic fire).

EarthLaunch 6y ago
That makes sense in high risk areas, which makes the private cost the whole house rather than the insurance.

davidbanham 6y ago

I assume you're located in the US? I don't know how your system works over there but here in Australia it's a bit of a hybrid. Most of the fire service's funding is taken from the private insurance industry then the rest is taken from governments. [1] 1. https://www.fire.nsw.gov.au/page.php?id=48#funding https://www.fire.nsw.gov.au/page.php?id=48#funding

imglorp 6y ago

Good point about private insurance. Market forces might sort that one out. The other coin is public. FEMA bails out people who built in risky storm and flood zones like New Orleans. At the very least, I feel FEMA should be a one-time thing, if you insist on rebuilding in the same place, the government shouldn't be there for you again next flood.

lumost 6y ago
The reason for federal flood insurance is the “100 year flood”. As major floods are correlated private insurance struggles not to simply go bust. Given that most buildings are built for 30-40 year spans, forcibly rebuilding once per century can be done economically. The problems arise when hundred year floods become 10-30 year floods.