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Comment by marcus_holmes | Hacker News Reader

What a way to destroy your own industry.

If getting insurance increases the cost of a bad thing happening, instead of decreasing it (because your claim will be refused, and you'll also be charged with fraud for even trying to make a claim) then what is the point of taking out insurance on anything?

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No worries for the insurers -- you're legally required to get insurance for all sorts of things in the US. Vehicles, mortgages...even some landlords require that renters hold a renters' insurance policy.

You're not legally required to get insurance for a mortgage. But you won't have much luck finding a lender who will lend to you if you don't. I'd be surprised if this wasn't equally the case in most other countries.

That's only true if you're putting down less than 20%. Once you're over 20% lenders don't care. I recently put 50% down on a house and did not have to get insurance. The lender said it was one of the cleanest loans they've ever done.

Is that true for homeowner's insurance? As far as I know, the 20% rule is for private mortgage insurance (PMI), which pays to the lender if you fail to make your payments. Basically an added payment because with a low down-payment, you're seen as an extra risk of default that must be insured separately.

Sorry, I meant PMI, not homeowner's insurance. The GP said "mortgage insurance" and that's what I was referring to. I absolutely have and was required to obtain homeowner's insurance to get a loan.

Don't know if that's true all the way around, put down more than 20% and had to have multiple very specific types of coverage, and they needed proof every year that the policies were renewed. Every year I held the mortgage, I got a nastygram because their system didn't do the auto-checks at the right time. Could be specific to type of home/location, though.

I've put down 20% and was required to have insurance.

I wasn't required to escrow it, but that's because I asked.

Because it's the law to have certain insurance like health and car insurance.

You don't have to have health insurance. You have to pay a fine for not having health insurance. Many people decide that the fine is the cheaper option, so health insurance companies at least have to compete with that.

The "fine" is now $0 after the tax cuts last year

You don't "have to" do anything under the law. Nobody comes and holds you by the wrist and makes you do it. You just have to pay fines, or go to jail for not doing it.

To drive on the public roads you have to prove "Financial Responsibility" for most people the cheapest and most effective way to do that is Auto Insurance, however every state i am aware of has alternatives, aka "Self Insure" that can be a Bond, or some other guarantee that you are able to cover the minimum liability of state

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