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Insurance companies cannot credibly cover acts of god, aka correlated risks, because they happen to too many people all at once. It's not a simple matter of "fixing" insurance for those matters.

NPR's Planet Money had a good discussion: http://www.npr.org/sections/money/2014/10/03/353030214/bedbu...

We're talking about hail. Insurance companies cover hail damage all the time.

(Actually, hail claims have been going up: http://www.claimsjournal.com/news/national/2014/05/02/248354... )

Someone drove his car into a hailstorm unprotected. That's not an act of god.

If you're in the middle of Kansas and a big hailstorm comes up there isn't much you can do. There's nowhere to hide.

Kansas has trees and overpasses; it's not completely barren. I just drove through a ridiculous rain storm in Kansas two months ago and had to do exactly this.

If you're driving cross-country you're on an interstate. Park under an overpass.

And get hit from behind? No, thanks.

Interstates generally have a decent width shoulder to pull over on.

Also, it's not safe to drive during a massive hailstorm. You should be pulled over anyway.

We're talking about a car-hauler. You could run into it from behind with a loaded dump truck and do no damage (to the car-hauler).

The entire reason we buy insurance is to cover events like that, that one would be unable to cover personally.

Of course they can cover. It's a matter of how much you pay for your insurance, and to a large degree how much they company saves up. In the case of a hailstorm it's not because they cannot pay, it's because they don't have proper savings to cover it. A hailstorm with fist size hails is not going to cover the entirety of California, so it's very manageable.

An example, when a fireworks factory in Denmark exploded the total claim of material damage was 750 million DKK (113 million USD). The vast majority was covered by insurance companies, even though that would fall under correlated risks. One of the way insurance companies handle this is to have a joint fund with other insurance companies (I think this is government mandated), where they can withdraw in cases like this.

This joint fund is called reinsurance- essentially insurance for insurance companies.

> It really feels like less insurance and more government mandated protection money;

Car insurance is different from other forms of insurance. The reason car insurance is mandatory is because otherwise, if you hit someone or damage their property with your car and they successfully sue you, they could very well end up with nothing (if you're broke). With insurance, that person is guaranteed to get a payout, because the insurance company is well-capitalized enough to be certain to pay out.

In a world in which everyone drives, this is mathematically equivalent to everyone purchasing insurance against damage that happens to them or their car by someone else. The reason it's not structured this way is because (1) not everyone drives a car, and (2) it creates a moral hazard problem (having car insurance - and the consequences to taking actions which can raise your premiums - serve as a deterrent to bad driving.)

Basically Car Insurance isn't to protect you. It's to protect other people from you. Which is why someone can get in an accident while driving drunk and their insurance company has to pay.

Only liability insurance is mandatory, and that would never cover your hail-damaged car, so this seems like a specious argument. You're not required to have collision and comprehensive coverage if you don't feel it's worth it.

I think that is exactly his point. The government doesn't make you get insurance that would cover hail damage to your car. It only makes you get insurance that will cover you when someone sues you for injuring them and damaging their property.

We went through a very similar experience when our car was being transported half way across the country. They driver somehow managed to roll his trailer on a freeway curve (his claim was high winds). His insurance company tried to claim act of god because "the wind did it".

I'm still trying to figure out how the wind pushes over an open trailer with 2 sports cars on it. At least mine was 4 or 5 years old at the time, the other car on there was brand new and had only been driven far enough to get it on and off the trailer.

Did your insurance company also not cover it?

I'd always, perhaps naively, assumed an "act of god" was simply covered.

Wow this thread has confirmed what I always suspected: shipping a car is a bad idea. I have actually pulled a car behind a U-haul through multiple states, but that was me, and I know how to pull trailers. A friend of mine in Hawaii was all set to ship his car from the mainland until I pointed out how little sense the math made.

It's perfectly safe and low risk if the vehicle is secured In a cargo container.

Anecdotes on the Internet do not actually confirm much.

> The car was only blue booked at 5k at the time, but we had to replace it with a 25k car, so I count that as a decent amount of loss.

That's twisted logic. There was a loss of perhaps somewhat more than $5k all things considered, but you didn't have to replace a $5k blue-book-value car with a $25k car. That $25k may have been a big outlay if you paid cash, but it's not a loss for that amount. So far, you've only lost $25k-(current bluebook value), which is much less than $25k (as long as the car hasn't been damaged) even if the car was new and dropped a thousand or two the moment you bought it.

I think you might have been misunderstanding my statement, as I would agree that the loss ranges between 5-10k (not far from your estimate.) To me it's a sum of 2 things: Loss of a 5k car + loss of opportunity/investment returns of 25k over at least 5 years. Don't mean to compare to OP's 50k repair bill, but even 5k-10k for someone else's negligence hurts when insurance somehow dodges the bullet.

> Loss of a 5k car + loss of opportunity/investment returns of 25k over at least 5 years

This, but minus the value of the car you now have.

Wouldn't you in this case claim the money from the transporter and they would hopefully be covered by their insurance?

I tried, but they started playing hardball, saying that if I didn't take the car from them (which they wouldn't allow me to do without signing a contract saying that I accept it "as is" and promise not to follow up) they would start accruing charges for storing it. I had just moved into the area for a job starting simultaneously, so unfortunately I didn't have the free time or resources to maneuver against them (The closest thing I got to legal advice amounted to, verbatim, "They have you over a barrel"). The whole situation seemed really sketchy.

Would reporting them for theft work? Tell them they have X time to give you your car back or you will report them for theft.

In that case it should be the shipping company's problem - they were responsible for it, they get to pay for it. If their insurance policy doesn't pay for it for whatever reason, that's not your problem.

Why would your insurance cover negligence of someone transporting your car? Ask for them to pay for the repairs, or sue them if they refuse.