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Do you live in CA? In recent years that's the majority of arbitrary cancellations I've heard about - companies pulling entirely out of CA.

by dmoy 3y ago

bluejekyll 3y ago
Similar reports are coming out of Florida. Generally, it seems the industry is pulling away from higher risk to climate change issues from larger storms or fire risk.
- dmoy 3y ago
  Yea I think that is exactly correct
- tfehring 3y ago
  There’s a saying in the insurance industry, there’s no such thing as a bad risk, only insufficient premium. Natural catastrophe risk is definitely increasing, but the insurance industry can handle that. The fundamental issue is that regulators in many states (including CA and FL) won’t let insurers charge enough to compensate for that risk.
- rufus_foreman 3y ago
  That's not the issue in Florida. The issue in Florida is that "although Florida only accounts for 9 percent of the country’s home insurance claims, it is home to 79 percent of the country’s home insurance lawsuits". That's from https://www.bankrate.com/insurance/homeowners-insurance/florida-homeowners-insurance-crisis/ https://www.bankrate.com/insurance/homeowners-insurance/flor..., which explains how the roofing scams work in that state. The legislature is working on it.
  - howard941 3y ago
    The legislature already worked on it. It had its way with it, totally. Despite the "work" that was done rates have skyrocketed. We're so deregulated there's no room for any additional work that doesn't break down the front door and walk out with stuff What's actually happening in Florida is the insurance companies are Janus entities. One part is an insurance company that's subject to rate regulation and the other part is a consulting firm that gets paid large sums of money from the regulated company and that's where all the profits live.
    - HDThoreaun 3y ago
      What do you expect when the market collapses and most suppliers leave? Of course everyone else will raise their prices. Now Florida needs to wait for insurers to come back and competition will happen.
hn_throwaway_99 3y ago
I 100% agree with landedgentry. I don't really have any problem with insurers using drone photos - anyone can take drone photos of anyone else's property - and I'm not really a fan of the article calling it "spying" to imply some special kind of nefarious behavior. But I do think the total bullshit is that companies are just using it to come up with essentially fake reasons to drop customers: > Cindy Picos was dropped by her home insurer last month. The reason: aerial photos of her roof, which her insurer refused to let her see. ... Her insurer said its images showed her roof had “lived its life expectancy.” Picos paid for an independent inspection that found the roof had another 10 years of life. Her insurer declined to reconsider its decision. I also don't have a problem if an insurer decides to leave a state entirely - that decision is essentially saying the state has made it impossible for them to adequately price risk, and that's something the state should fix if so desired. But these BS cancellation reasons seem like a case of insurers wanting to have their cake and eat it too. I'm not very familiar with state-by-state insurance law, but I'm assuming they have to come up with some reason to drop a homeowner that already has a policy, so this looks like they're trying to find BS reasons to just drop potentially less profitable parts of their portfolio.
- halfcat 3y ago
  Why aren’t insurance companies required to operate like market makers in the equities markets, where they’re free to choose the price they’re offering, but must offer a price in the market they’re in? If the roof needs replacing (in the insurance company’s view) then charge whatever the rate is that covers that and still makes them a profit. Don’t just deny coverage.
  - overstay8930 3y ago
    They will just charge the customer the price of a new roof, there’s no point in what you’re asking for.
  - rybosworld 3y ago
    If you ever look at the options chain on a thinly traded equity, you'll notice small volume and very large bid/ask spreads. Sometimes the bid/ask spread is so large that it looks like a computer glitch. The primary insurance market is even more illiquid than thinly traded options.

Do you live in CA? In recent years that's the majority of arbitrary cancellations I've heard about - companies pulling entirely out of CA.

by dmoy 3y ago

Do you live in CA? In recent years that's the majority of arbitrary cancellations I've heard about - companies pulling entirely out of CA.

bluejekyll 3y ago

Similar reports are coming out of Florida. Generally, it seems the industry is pulling away from higher risk to climate change issues from larger storms or fire risk.

dmoy 3y ago
Yea I think that is exactly correct
tfehring 3y ago
There’s a saying in the insurance industry, there’s no such thing as a bad risk, only insufficient premium. Natural catastrophe risk is definitely increasing, but the insurance industry can handle that. The fundamental issue is that regulators in many states (including CA and FL) won’t let insurers charge enough to compensate for that risk.
rufus_foreman 3y ago
That's not the issue in Florida. The issue in Florida is that "although Florida only accounts for 9 percent of the country’s home insurance claims, it is home to 79 percent of the country’s home insurance lawsuits". That's from https://www.bankrate.com/insurance/homeowners-insurance/florida-homeowners-insurance-crisis/ https://www.bankrate.com/insurance/homeowners-insurance/flor..., which explains how the roofing scams work in that state. The legislature is working on it.
- howard941 3y ago
  The legislature already worked on it. It had its way with it, totally. Despite the "work" that was done rates have skyrocketed. We're so deregulated there's no room for any additional work that doesn't break down the front door and walk out with stuff What's actually happening in Florida is the insurance companies are Janus entities. One part is an insurance company that's subject to rate regulation and the other part is a consulting firm that gets paid large sums of money from the regulated company and that's where all the profits live.
  - HDThoreaun 3y ago
    What do you expect when the market collapses and most suppliers leave? Of course everyone else will raise their prices. Now Florida needs to wait for insurers to come back and competition will happen.

hn_throwaway_99 3y ago

I 100% agree with landedgentry. I don't really have any problem with insurers using drone photos - anyone can take drone photos of anyone else's property - and I'm not really a fan of the article calling it "spying" to imply some special kind of nefarious behavior. But I do think the total bullshit is that companies are just using it to come up with essentially fake reasons to drop customers: > Cindy Picos was dropped by her home insurer last month. The reason: aerial photos of her roof, which her insurer refused to let her see. ... Her insurer said its images showed her roof had “lived its life expectancy.” Picos paid for an independent inspection that found the roof had another 10 years of life. Her insurer declined to reconsider its decision. I also don't have a problem if an insurer decides to leave a state entirely - that decision is essentially saying the state has made it impossible for them to adequately price risk, and that's something the state should fix if so desired. But these BS cancellation reasons seem like a case of insurers wanting to have their cake and eat it too. I'm not very familiar with state-by-state insurance law, but I'm assuming they have to come up with some reason to drop a homeowner that already has a policy, so this looks like they're trying to find BS reasons to just drop potentially less profitable parts of their portfolio.

halfcat 3y ago
Why aren’t insurance companies required to operate like market makers in the equities markets, where they’re free to choose the price they’re offering, but must offer a price in the market they’re in? If the roof needs replacing (in the insurance company’s view) then charge whatever the rate is that covers that and still makes them a profit. Don’t just deny coverage.
- overstay8930 3y ago
  They will just charge the customer the price of a new roof, there’s no point in what you’re asking for.
- rybosworld 3y ago
  If you ever look at the options chain on a thinly traded equity, you'll notice small volume and very large bid/ask spreads. Sometimes the bid/ask spread is so large that it looks like a computer glitch. The primary insurance market is even more illiquid than thinly traded options.