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> However, with more insurance companies pulling out of the California market or limiting coverage recently due largely to the elevated risks of natural disaste
by lolinder 3y ago
> However, with more insurance companies pulling out of the California market or limiting coverage recently due largely to the elevated risks of natural disasters, some homeowners may have no other option.
Elevated risk of natural disasters is half the story. The other half is that California won't let insurance companies price their plans based on risk, which in the face of said natural disasters gives them really only one option—withdraw [0]. It's pretty misleading of TFA to leave that important context out.
From KCRA:
> Unlike most states, California tightly restricts how insurance companies can price policies. Companies aren't allowed to factor in current or future risks when deciding how much to charge for an insurance policy. Instead, they can only consider what's happened in the past on a property to set the price.
[0] https://www.kcra.com/article/california-insurance-price-policies-climate-change/45253629 https://www.kcra.com/article/california-insurance-price-poli...
- dv_dt 3y agoLeaving it to market also won’t take care of the problem and would instead cause chaos in the home ownership market for no beneficial reason. The market can’t do the correct thing unless the cost is correctly linked to the reason for the increased costs. There needs to be another solution - personally I would think apply a tax to fossil fuels that pays into an insurance fund to partially lower underwriting risk.
- whimsicalism 3y agoWe should not tax fossil fuels to subsidize costs for people choosing to live in dangerous regions.
- theossuary 3y agoWe should if they're the reason the regions are becoming more dangerous.
- basil-rash 3y agoYes, a person in the inland empire using gas to get to their job far as fuck away because that’s all the house they can afford should clearly be subsidizing some coastal elite’s “I want a house on a cliff overlooking the ocean” insurance. Because fossil fuel use is the direct cause of the house’s instability.
- vineyardmike 3y agoIs there any indication that the high risk properties in California are coastal instead of rural or exurban? Presumably the risk is from fire and that’s disproportionately not going to be in highly developed communities like the coastal regions.
- danans 3y ago> Is there any indication that the high risk properties in California are coastal instead of rural or exurban? https://experience.arcgis.com/experience/03beab8511814e79a0e4eabf0d3e7247/ https://experience.arcgis.com/experience/03beab8511814e79a0e... There is very high fire risk in the coastal hills, which contain the most expensive real estate in CA, but low risk in the adjacent urban areas closer to the water. The exurban areas of CA are in the Central Valley, which has lower fire risk, but very high heat risk. Rural areas can have high or low fire risk, depending on where they are.
- dv_dt 3y agoThis seems like a random meme designed to avoid drawing a basic line of responsiblity between fossil fuel emissions and the costs they impose on many people. That's one discussion. Another discussion is if you chose to connect those - then how do you distribute the costs - and some allocation picked to inflame the discussion seems to be avoid the first issue while assuming some particular lopsided distribution.
- whimsicalism 3y agoFrankly, the evidence is not there that these wildfires are being caused by climate change vs cyclical droughts and mismanagement.
- John23832 3y agoIf global warming caused by C02 emissions is the reason why the place is becoming dangerous, why not? The fact that insurance companies are making changes now shows that this is a more recent trend.
- lazide 3y agoFire danger in California is mostly due to terrible forest management policies - large scale blanket fire suppression and serious impediments towards logging and brush clearing. Global warming may be what is lighting the match (sometimes - but frankly probably is only a minor influence) however the giant pile of fuel that has been growing for 100 years remains almost completely unabated.
- John23832 3y agoTwo things can be true at once. A dog can have ticks and fleas.
- lazide 3y agoA match thrown down in a healthy forest won’t produce a massive apocalyptic firestorm. No matter the time of year. Even back in the 70’s the National Park service in Yosemite knew the existing forest management practice was creating apocalyptic fire risk (and the ‘91 Yosemite fire bore that out) but until very recently, practices across the state have been unchanged. [https://www.nps.gov/yose/learn/nature/firehistory.htm https://www.nps.gov/yose/learn/nature/firehistory.htm] Defacto, walk through the forests in California and the build up of brush is monumental. Along the coasts and in the Sierra Nevada. Many areas are impassible, except those that have burned recently.
- hackernewds 3y agoIf that were the case, we could let the trees be logged which I'm sure industries are scrambling to do, seems like a win-win? The fact that it hasn't happened would imply it is not the case.
- lolinder 3y ago> would instead cause chaos in the home ownership market for no beneficial reason. People losing home insurance altogether and being unable to find a replacement is going to be less chaotic for the home ownership market than insurance rates going up?
- basil-rash 3y agoIf uncertainty about the future value of the home brings prices down I’m all for it.
- lazide 3y agoAnyone with a mortgage is in theory obligated to get insurance asap - or owe the bank the entire outstanding balance. And if the place burns down they are still on the hook for the entire mortgage too. If no one will underwrite? Oh shit.
- basil-rash 3y agoAllow me to shed a tear for these hypothetical mildly inconvenienced landowners.
- lazide 3y agoYou mean like the 10’s of thousands of exurb Californians who all the sudden found themselves in ‘high risk urban-wildland fire zones’ after the recent wildfires? Or who found themselves above a fault that no one previously knew about? It’s not theoretical. [https://www.latimes.com/business/story/2021-09-26/california-fire-insurance-moratorium-expire https://www.latimes.com/business/story/2021-09-26/california...]
- basil-rash 3y agoYes those. My family is actually among them, and guess what: our insurance premiums went down, and we're no longer being forced to pay for benefits we would never have actually received. (do you really think insurance companies were going to pay out for a natural disaster? their entire business model is refusing to pay out of they can find a way to weasel out of it. to the point they'll call themselves doctors and tell the real doctors what they can and can't do. the less mandatory insurance the better, such that the market might finally force them to be either helpful or cheap, but certainly not neither.)
- kevinpet 3y agoBrilliant, now it's not just people who live in cities subsidizing rich people who choose to live in high fire risk suburban borders but everyone who drives too.
- vineyardmike 3y agoGenerally, the people most at risk for fire are not particularly wealthy - they live out in the exurbs. Generally I’m not too supportive of socially subsidizing an expensive lifestyle, but let’s be clear that “everyone who drives” collectively generated this risk through pollution.
- lolinder 3y ago> let’s be clear that “everyone who drives” collectively generated this risk through pollution. No, let's be clear that everyone who lives in the developed and developing world collectively generated this risk by living in said world. In the US, the transportation sector as a whole accounts for only 29% of our collective greenhouse gas emissions [0]. Within that sector, passenger cars only account for 20% of the 29%, or 5.8% of our total greenhouse gas emissions in the country. That's still a lot of greenhouse gases, but it's barely the tip of the iceberg of our total generation in the US, and the US itself only accounts for ~12% of the world's emissions. Picking on passenger cars for pollution is similar to picking on green lawns during drought: sure, it's something that your average Joe can stop doing to feel like they're helping, and people who water their lawns make for a fun villain if you're into that kind of thing, but even if you managed to get that use case down to 0% of what it is currently you wouldn't even have begun to solve the actual problem. [0] https://www.epa.gov/ghgemissions/sources-greenhouse-gas-emissions#transportation https://www.epa.gov/ghgemissions/sources-greenhouse-gas-emis...
- khuey 3y ago> In the US, the transportation sector as a whole accounts for only 29% of our collective greenhouse gas emissions [0]. Within that sector, passenger cars only account for 20% of the 29%, or 5.8% of our total greenhouse gas emissions in the country. You need to account for light duty trucks here too. Merely including "passenger cars" is wrong since enormous numbers of Americans are driving pickups/SUVs/etc as their personal vehicles. That would push personal transportation to 16.5% of our total GHG emissions.
- akira2501 3y ago> Leaving it to market also won’t take care of the problem Why not?
- deleted 3y ago[deleted]
- jeffbee 3y agoI'm in another discussion on this very site where people (admittedly, not you) are arguing that property owners are "housing providers" because they stand between tenants and asset risk. But in this thread you suggest that at the first whiff of risk the state should step in to subsidize the risk of the wealthiest 1% of the state.
- dv_dt 3y agoNot the first whiff of risk, a solid look at increasing risk due to climate change. This is one company now, but is an issue which is going to keep hittiong more companies & more home owners.
- georgeburdell 3y agoI wonder why California thinks it needs to implement pricing controls as well as provide its own alternate insurance. Is this latter construct the “public option” equivalent for home insurance? California ought to compete for business with the private companies, not drive them away.
- jeffbee 3y ago"California" might not think this now but in 1988 at the tail end of a spectacular streak of magical thinking on the part of the electorate these insurance regulations were passed by plebiscite, so it will take either another supermajority plebiscite or a political revolution to fix the regs.
- khuey 3y agoIt only requires a majority plebiscite, not a supermajority, to fix.
- navi0 3y agoNote: CA (un)FAIR Plan is not underwritten nor operated by the State of California. It is a state-mandated insurer of last resort run by an association of admitted insurers. If it experiences losses that exceed its assets and reinsurance coverage (which its president has said is a real probability), then every admitted policyholder in CA would be assessed a fee over the course of 1-3 years to cover the gap. The CA FAIR Plan only offers $300/sq foot to rebuild, which is far less than the $500-1000/sq foot it costs to build new construction in most parts of the state. In other words: the backstop for the CA FAIR Plan being unable to charge risk-appropriate premiums is an involuntarily assessment of policyholders in lower risk locations.
- hackernewds 3y agoYou'd prefer the government with unlimited resources and little incentive for quality should compete with private enterprise?
- hackernewds 3y agoin addition you basically get punished for being a good driver with not having a history of rash driving, subsidizing the bad drivers. wonder if this extends to taking loans. it is a significant moral hazard for the govt to intervene in such a manner