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Comment by basil-rash | Hacker News Reader

If uncertainty about the future value of the home brings prices down I’m all for it.

It will bring home ownership costs way up as it has in Florida. It would also allow corporations who can self-insure to have a leveraged capital advantage to buying up homes - which doesn't help individual people who want to own homes.

The pressures of climate change disasters is a increasing bar of costs everywhere, home insurance is one of the first very visible places that is a predictor. We're going to have to figure out if we're ok with privitized fossil fuel profits with companies paying little to no taxes, while the costs land in very concrete ways on individual and gov't budgets.

They won’t have a capital advantage when all the homes they just bought up flood and now they’re out tons of money because they mispriced the insurance risk and self-insured.

The cap advantage is multiple - that a banks will lend them more, there is no insurance company profit margin, they can rebuild faster w/o that same insurance company approval red tape. With renters they can price up faster than individual incomes grow.

But note that none of this fixes the core fossil fuel driver to the costs.

Anyone 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.

Allow me to shed a tear for these hypothetical mildly inconvenienced landowners.

You 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...]

Yes 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.)

You mean after the state stepped in a mandated the insurance company do it - which is why many insurance companies are pulling out of the state now?

And when something happens, now the taxpayers are on the hook?

Where does it say taxpayers are underwriting the state's home insurances? And how would that be different from literally any other insurance company ever? Who do you think insurance premiums are paid by?

California has a last resort insurer where the insurance funds are backed by the state - aka the taxpayer.

And you are still paying for insurance, supposedly based on your comment correct?

So what do you think is going on, if your rates went down despite being in a higher risk category?

Insurance companies have stopped scamming us by charging premiums for services that would have never actually been rendered, as I have already stated.

Since the actual set of coverages are set by law, and heavily regulated what you are saying makes no sense.

Or are you saying you signed up for insurance that doesn’t cover fire disasters in these now discovered high risk fire zones? Because if so, yikes.

Because you’re on the hook now. You might as well have signed something on your health insurance saying you don’t need coverage if you get cancer.

Insurance companies definitely paid out during prior disasters for insureds, which is why the insurance companies took such heavy losses. Over $12 billion in California in 2018 alone. [https://www.insurance.ca.gov/0400-news/0100-press-releases/2...]

So if you voluntarily aren’t getting fire damage coverage in a high risk fire zone? Yikes.

If you somehow are believing that the insurance company would never have paid you if it happens, but they’ll charge you less if you don’t get the coverage? I have no words.

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