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The problem is the culling Insurance companies are very keen to get as much risk as possible off their books before the climate gets even more extreme in its v
by worik 3y ago
The problem is the culling
Insurance companies are very keen to get as much risk as possible off their books before the climate gets even more extreme in its volatility
Good goes with bad, so long as the bad goes, some good going too is undesirable but OK because they are aware if the catastrophic climate events looming
The insurance companies are behaving logically, probably legally IANAL, but for people who are simply caught in the wash it is unfair
This is part of the huge systematic disruptions we are all going to have to adapt to, or die from, due to climate change
Worrying times
- Nifty3929 3y agoInsurance companies are keen to align risks with premiums. The more accurately they do so, the less volatility they will have. And in the short run, probably more profit as well. This also helps consumers, where lower-risk folks will overpay less, and higher-risk folks will be required to lower their risk or contribute more in premiums.
- tptacek 3y agoYou (say) have a trampoline. I do not. We share an insurer. Our insurer asked, when you applied, if you had a trampoline. Your trampoline materially increases the risk that insurance is going to have to pay to cover a lawsuit on your property. You lied, and said you didn't. I am now paying to subsidize your trampoline. Why shouldn't I want them to be running drones over our houses? Worrying times... for pirate trampolines!
- RomanAlexander 3y agoWouldn't said trampoline simply not be covered by the policy since you lied about it? The agents are checking a box and the underwriter is sticking in a boilerplate "Customer said no trampoline therefore trampolines are excluded from this policy" text
- tptacek 3y agoIt depends on the policy, but either way, this is the kind of risk we're talking about managing with culls: trampolines, and bad roofs. I pay to keep my house up. You (say) don't. Why should I be OK with subsidizing your resulting claims with higher rates? I think there's a sort of weird subtext in the "risk pooling" discussions on this thread that "risk pooling" is a way for people who don't replace their old roofs to get protection from the people who do. But that's not at all the concept! You refusing you repair your roof isn't an act of god; it's just recklessness.
- PaulDavisThe1st 3y agoYou seem to be forgetting that this avoidance can work at two times: 1. pre-emptively dropping or refusing coverage 2. claim inspectors concluding the company has no liability for a particular incident. It doesn't all need to be #2 (and probably should not be), but it also doesn't all need to be #1 either.
- hattmall 3y ago#2 is less successful and incurs more costs. Trampolines are a good one because let's say you lie about a trampoline. Ok, great, we don't have to cover any trampoline related injuries. What are the chances that you would then lie and say that a broken arm occured on the steps instead and simply fail to mention the trampoline like you already did.
- tptacek 3y agoYou, the rogue trampoline owner, aren't really the party that the insurer is worried about. Your kid's best friend's parents are. (And it's not a broken arm they're really freaked out about --- don't make a homeowners claim over a broken arm, probably; it'll cost you more in the medium term --- it's death or paralysis, both of which will put millions of dollars on the line).
- NovemberWhiskey 3y agoIt’s worse than that actually; say the liar’s house burns down and the insurance adjuster finds the trampoline in the garden after the fact. As I understand it, the insurer can void the entire contract.
- tptacek 3y agoI mean, the insurer in that case discovered that the client was defrauding them. If you steal $100 from someone's cash register, buy scratchy lotteries with it, win $200, and put the $100 back in the register, you're still a thief. That's the logic here: you gambled on a pirate trampoline and feel like you should have won. I don't know if it really is the case that your insurance can be voided over material misrepresentations unrelated to your claim, but certainly there's no moral argument that it shouldn't work that way.
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- skissane 3y agoIt isn’t always fraud or lying - you apply for insurance. Insurer asks you a million questions. One is “do you have a trampoline”? You honestly answer “No”. The fine print of the application form says you have to tell them if at any time your answers change. After a while, you forget it even asked you about a trampoline. Then, you get your kid a trampoline. Per insurance fine print, you are suppose to inform the insurer of this change in circumstances immediately, but you’ve forgotten that. Also, it depends on the jurisdiction, but while the insurer can try to void the whole contract, courts don’t always let them do it, especially if the policyholder convinces the court it was an innocent mistake or oversight rather than a deliberate lie.
- tptacek 3y agoThis is not a good example of "fine print", because trampolines are notorious sources of injury. It's like if you added a pool to your property and didn't tell your insurer because you "forgot the fine print". You can plead that, but if I was your neighbor, I'd be rooting for the insurer. Knowing about the dangers of things you set up on your property is on you.
- pxeboot 3y ago> Wouldn't said trampoline simply not be covered by the policy since you lied about it? This doesn't stop expensive lawsuits, even if they ultimately don't pay the claim.
- potatolicious 3y agoAlso doesn't stop the lawsuit between the policy holder and the insurance company, which also costs money. Whereas your ability to sue for a non-existent policy (or one where that was unambiguously canceled) is... much less.
- JumpCrisscross 3y agoTrampoline is a bad example. Pool is not. That could threaten your house’s structure, or cause damage to your neighbour’s in a storm. The article gave an example of an overhanging tree—it makes sense for the population to segregate into those who will manage that risk and those who won’t, with the latter being charged a higher premium.
- tptacek 3y agoPools are insurance issues because people die in them, and their nexts of kin sue the homeowner.
- BeFlatXIII 3y agoWe ought to change the law to stiff the money-seeking families of victims. So long as the pool was fenced or fully above ground (required a ladder to access)
- firesteelrain 3y agoPools are 'attractive nuisances'
- firesteelrain 3y agoIt increases the chance of a claim against the homeowner insurance if a neighbor's kid gets injured on your property. Even if it ultimately will be on you, the insurance company will likely get sued and may settle which increases costs. They'd rather go the cheaper, drone surveillance route to find offenders early and warn them or else.
- WalterBright 3y agoIt would be hard for the insurance company to prove that the head injury was from the trampoline rather than tripping on the porch.
- barsonme 3y ago> Why shouldn't I want them to be running drones over our houses? Because it’s creepy.
- wombatpm 3y agoInsurance companies want money to come in and never go out. If they could they would sell life insurance to dead people and homeowners insurance to the homeless.
- tptacek 3y agoThe irony here is that's what insurance customers want, too: to incur arbitrary risks and have other more responsible customers pay for them.
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- nothercastle 3y agoCustomers want to pool risks with other customers that are lower risk than they are. Florida homeowner want to be on a national market because they are the highest risk group. Obviously the rest of us want Florida to be separate.
- tptacek 3y agoIt's good to want things! But if you're a bad driver, you don't get to pool with people with zero accidents and tickets.
- lobsterthief 3y agoThis is a really bad analogy that doesn’t hold water. There are good drivers and bad drivers. There are also good homeowners and bad homeowners. I live in Florida, but chose not to live in a flood-prone area. We also have hurricane clips on our roof, and we just changed all our windows to impact-resistant windows (with the help of a state-sponsored program, actually). Our insurance isn’t that high at all. Could it be lower? Sure, I’d love that. And maybe a national program would do that. Modern building codes require things like impact windows and that the building be rated for high winds. Older buildings should be retrofitted with things like impact windows, but I would only call those homeowners “bad drivers” if they can afford to do so but don’t. I wouldn’t blame an elderly person on fixed income for not affording to do this and call them a “bad driver”. I’ve walked around San Francisco quite a bit since my company is based out of there, and I’ve seen a lot of people retrofitting their houses with those diagonal beams for earthquakes. San Francisco is waiting for the “big one”; is anyone who can’t dump money into living in a safer building, or retrofitting the one they own, the equivalent of a “bad driver”? Obviously not. FYI in Tampa, also called the “Bay Area” to locals, we’re also waiting for “the big one” (a CAT-4 or CAT-5 coming directly into shallow Tampa Bay, which would cause an enormous storm surge). That last happened in 1918 or so and it actually permanently changed the geography where it came in, creating an area known as Hurricane Pass. All we can do is prepare and be responsible to our communities. Anyways, you can’t lump all people in a geography, regardless of behavior, into one group. It does a disservice to the people who are doing the right thing. Unless your building has been fully retrofitted for [insert local disaster] or you chose to live outside of [insert worst geography in your area to live with regards to local disaster], then you’re a “bad driver” too.
- delfinom 3y agoLol my dude, trampolines in backyards being a rejection reason has nothing to do with climate change. Yes climate change has caused an upheaval in some geographical regions. But there are many economic forces at play, from the treatment of real estate as an investment making every home a million dollars to insurers all being reinsured by a ever smaller pool of reinsurers.
- xyzelement 3y agoat least in the United States, home insurance is issued a year at a time. So it doesn’t make sense to cull today in anticipation of some hypothetical future shift towards cataclysm. Also, what is the aerial photo of a roof going to indicate in terms of “cataclysmic climate events looming”? Also is it a coincidence or a pun that your name is worik and it is common for you to sign your posts with something about worrying?