Is the world becoming uninsurable?

Tornadoes are quite a bit less common outside of North America, and especially the US. Some of that comes down to the absence of people in the places where tornadoes occur, so there's no one there to report them.

The Tornado Archive (https://tornadoarchive.com/) has a pretty well executed map to illustrate that. They report that between 2011 and 2021 (just the dates I punched in, so its possible the actual ratio is a bit different from that), the world saw ~20,000 reported tornadoes. North America reported 12,000 of them.

So its not just that Americans maybe don't know how to build tornado resistant structures. Its that the US and Canada's per-capita tornado rate is quite a bit higher than the rest of the world.

> Hurricanes are mostly just flood damage in the US, and some wind/debris damage exactly like the blown over trees you mention.

The insurance companies have done research on the topic (including building giant 'labs' with a large number of fans)

* https://fortifiedhome.org/research/

and have developed standards/techniques that home builders/owners can do to fix a bunch of problems, starting with roofing:

* https://fortifiedhome.org

* https://fortifiedhome.org/wp-content/uploads/2020-FORTIFIED-...

* https://www.youtube.com/watch?v=Zd-0yAPs6Wc

* https://www.youtube.com/watch?v=proGT6AtyJc

Tornados might be more intense but only for a short period of time and in a small area. I don't see any of those where the tornado is lasting days, causing sustained damage. There are some where there are multiple tornadoes in a span, but each individual tornado is itself quick and violent but localized within a mile or so at most.

Compare some incidents with, Hurricane Sandy, for example, where it traveled across the span of a thousand miles and lasted a week of damages.

If you have to be inside one, pick a hurricane. But tornadoes are so much smaller. This list is like... 10-20 per year with an average of less than 1 casualty and a dozen houses damaged? That's basically zero as far as insurance and habitability go. I found a study titled "Tornadoes in Europe An Underestimated Threat" and it has an estimate of 10-50 million euros per year in total damage. That's not even 1 euro per house in Europe.

Let's not be silly here. European tornadoes are not taking apart houses to the foundations. Ripping off roofs or flipping over cars or even when trees are falling on a tourist tent and killing them in process has nothing to do with how houses are built in USA and nowadays even in UK and elsewhere.

The real problem is that we're politically/socially unwilling to transfer the risk to the people who are responsible for creating it: Wealthy coastal landowners believe that the cost of home insurance should be about $2000/year. If their properties actually cost $200,000 per year to insure, then that's what they should have to pay! If they don't like it, they should either build something cheaper (that's the other half of the product) or move to somewhere with less risk.

Tornados are almost the perfect example of an insurable hazard: Very low probability, very high damage, very widely distributed across the affected areas:

https://mrcc.purdue.edu/gismaps/cntytorn#

Click around that neat interactive map, you'll see that the tornado is typically a few miles long and a few hundred yards wide, there are a few thousand severe tornadoes scattered all over the Midwest and somewhat fewer on the east coast in the past 70 years. It's not feasible to build houses everywhere that will stand up to an F5 tornado throwing cars. But they only cause a total loss of a tiny fraction of all houses in the country, and there are relatively few choices anyone east of Texas can make that would meaningfully impact their risk.

You could price insurance premiums at the risk of a tornado times the cost of the insured assets, plus a 10% administrative fee/profit margin, and those rates would be affordable. Maybe a handful of people would choose to live in Colorado instead of a few hundred miles east in Kansas because the cost of this 'tornado insurance' was higher in Kansas, but even in Tornado Alley it wouldn't be unaffordable.

Conversely, if you look at the hurricane incidence and storm surge risk map:

https://coast.noaa.gov/hurricanes/#map=4/32/-80

https://experience.arcgis.com/experience/203f772571cb48b1b8b...

and population density along the gulf coast:

https://luminocity3d.org/WorldPopDen/#7/28.541/-88.011

It's clear that people are choosing to build houses in the narrow strip of low-lying land that's right along the coast and vulnerable to high-probability storm surges! If insurance was priced at cost of assets + administration times risk of loss, it would be really, really expensive.

The 2024 hurricane season damage totaled $128.072 billion.

I couldn't find data for tornadoes in aggregate, only individual storms.

> Economically, tornadoes cause about a tenth as much damage per year, on average, as hurricanes. Hurricanes tend to cause much more overall destruction than tornadoes because of their much larger size, longer duration and their greater variety of ways to damage property. The destructive core in hurricanes can be tens of miles across, last many hours and damage structures through storm surge and rainfall-caused flooding, as well as from wind. Tornadoes, in contrast, tend to be a few hundred yards in diameter, last for minutes and primarily cause damage from their extreme winds

https://www.americangeosciences.org/critical-issues/faq/how-...

Tornados are indeed scary. I have seen a house cut in half like a knife by one. You could see the doors ripped off the medicine cabinet on the second floor and meds still on the shelf.

But tornados are also significantly smaller. A hurricane will damage a thousand square miles while a hurricane will mess up 50. It’s not quite right but the proportions are in that ballpark.

This was the whole issue. California made it illegal for insurance companies to raise rates, so the insurance companies stop renewals. Leaving everybody uninsured. Homeowners couldn't buy insurance at any price.

I don't think it is incompetence of the governments. It appears to be a goal of most US politicians to add to the coffers of private business, insurance companies included, at the expense of all but the most rich Americans.

These aren’t black swan events. These are swan events, if anything.

That doesn't align with the reality of these areas. To get insurance in these areas you have to demonstrate that you have created a defensible space around your house. This is enforced by local fire department inspections. I know this because I live near a fire prone area. Despite these things the area still burned. The problem isn't "lawns" or "wooden houses". In the case of the LA fires you would have had the burned out husks of concrete houses that would need to be demolished if everything was made of concrete. This was a black swan event that will require a thoughtful response.

A forward looking (part of a) solution for Malibu would be the county acquiring and maintaining beach paths every few houses. Prescribed 10' wide fire breaks.

This solves the fire problem AND the limited access to a public resource that is common in Malibu.

Ideally a permeable surface without any growth, cleared at least 2x a year.

Why is the answer not Japan's approach. My understanding is that because of high incidents of natural disaster they see/build homes as transient and utilitarian rather than as long-lasting investments.

I recall reading the same thing, however I do recall that they were East coast native Indians, that cleared oak tree forests as a hunting grounds, so completelly unrelated to the problem in California. The story was about native land rights and if such looking after their hunting grounds can be seen as claims on property rights, which Indians did not knew as a concept, so it is a moot point anyway. The issues that plague CA seems to be chaos in organization level - from what I have read these wildfires are happening in the year, that did had moderate drought(compared to others), so I would look suspiciously in this with the mind, that if politicians are blaming climate, then it is a sign that they are absolutelly responsible for what they have not done and promised to people. But I do not own a house there and I have not voted for these people and I absolutelly would not hang them in the chimney of my house.

PS Also, there are many opportunists, that were burning their houses to receive insurance or compensations, so not all of those houses were burned by wildfires. It all looks ugly, regadless from what angle you look, because if there is no responsibility - even from the ones that have taken upon resposibility, then catastrophe is expected - sooner than later.

I recall seeing a documentary on TV about this. Indigenous Americans were behind the effort to resurrect the practice.

https://www.nps.gov/subjects/fire/indigenous-fire-practices-...

> The truth is that the rich diversity and stunning landscapes of places like Yosemite and other natural environments in the United States were intentionally cultivated by Native Americans for thousands of years. And their greatest tool was fire.

https://www.history.com/news/native-american-wildfires

How are you making this claim? Every time a hurricane hits Florida, there are photos of entire neighborhoods devastated by wind and storm surge. How many people were permanently displaced by Katrine? Etc. Maybe many of the homes weren't technically "destroyed", but each storm brings millions or billions in damage.

Good to know. The news always seems to find footage of destroyed suburbs whenever the US is hit by a big one.

It rather blunts your point when 50km/h winds are a far cry from 160km/h winds.

Specifically, I'm now questioning if your drought was actually more intense. Not exactly sure how you measure that one.

You’re comparing apples to oranges.

A Santa Ana wind is extremely dry and this one hit 100kmh (not 50). And it hasn’t really rained for 8 months (since May 2024). And we had a very wet winter last year, so there’s extra growth to fuel any fire. And finally, there’s 10 million people live in LA County, it’s a target rich space.

Please let me know where else is having the same sort of fire without destroying homes.

It's not a competition. Both can be sights that people view in awe. Are you "Four Yorkshiremen-ing" wildfires?

You’re ignoring one critical difference between these two scenarios. Humans, and all human related activities, produce heat as a waste product. It’s much easier, and consumes less additional energy, to heat an occupied space, than to cool it. Thanks to the fact that your average human produces 80W of heat just to stay alive.

So every human in your cold space is 80W fewer watts of energy you need to produce to heat the space. But in a hot space, it’s an extra 80W that needs to be removed.

Add to that all of the appliances in a home. It’s not unusual for a home to be drawing 100W of electricity just keep stuff powered on in standby, and that’s another 100W of “free” heating. All of this is before we get to big ticket items, like hobs, ovens, water heaters etc.

So cooling a living space is always more costly than heating a living space. Simply because all the waste energy created by people living in the space reduces the total heating requirement of the space, but equally increases the cooling requirement of that same space.

All of this is ignoring the fact that it’s easy to create a tiny personal heated environment around an individual (it’s called a woolly jumper). But practically impossible to create a cool individual environment around a person. So in cold spaces you don’t have to heat everything up to same temperature for the space to be perfectly liveable, but when cooling a space, you have to cool everything, regardless of if it’ll impact the comfort of the occupants.

100%. And can be wonderfully done by efficient heatpumps that cover the warmer months too. Also nice correlation between hot and sunny areas which means solar can get you to net zero pretty quick. (Says man looking at his solar panels right now covered with snow.)

you cannot win this argument with the average person who lives in a chilly European country. it just does not compute.

there are whole important cultural lifeways related to opening and closing windows at proper times for efficient cooling and ventilation. these work really well — in Europe — and are treasured traditions.

getting people to accept AC is sort of like trying to convince the average American to go grocery shopping on a bicycle. some may accept the idea but only the most European influenced already.

This is such an interesting perspective that I've never thought about. Thanks!

Recently it was -7C where I lived. Even without heating, my indoor temp didn't go below 15C. In regions where cold temperatures are common, isolation and heat retaining materials are very common. Is preventing heat gain as simple as preventing heat loss?

a greenhouse can heat a space by enough to be comfortable for free, but not cool it. Windows and sunlight matter.

Sure Japan did it, so did Mexico. The latter is probably much more important as an example for the US.

https://www.preventionweb.net/news/not-drill-how-1985-disast...

I would be interested to know how Japan combats wildfires. Historically at least it was quite a big problem, if I recall correctly.

I won't disagree with you, but it's a big change.

When European descendants started colonizing that part of the world they treated all the resources as free for the taking. You went into nature, developed some land for agriculture, and it became yours by right. The same with the water. It was essentially homesteading.

So water was treated as property the same way the land was. Whoever used it first, owned it. Leaving out the natives because apparently nobody cared about them, it made sense.

How we fix it now within that legal framework is the question.

Hey I'm trying to alleviate this issue from a technical standpoint and am trying to find others to join me. It's no cure-all, but the other paths would upend a century of legal precedence. Shoot me a PM if you're looking for work.

Comments like the last here irritate me. No, we all learn that wood is the only appropriate building material and the Salesforce tower in San Francisco required a whole forest of trees to construct.

The root comment is based on a very dated concept. Of course we can built earthquake resistant megastructures from steel and concrete. A lot of that building technology was created in California. It's either naive or willfully ignorant to think we can't solve this problem.

The issue with those materials is cost. Spread out, suburban design without density is expensive and wood frame construction is a great way to affordably build housing. Wood frame single family houses are not the problem - it's how we design our cities that's the problem.

Less about the question (that has been asked so much now its tiring) but more on how when people do ask it, they always ask in such a negative way. Its not why are so many homes built out of timber/wood but rather why are they built out of sticks?

> Here in the seismically stable UK

I don't think the US has enough seismic activity to be much different. Chile and Japan do fine with solid construction and periodic 6-8 Richter earthquakes. California is allegedly a seismic state within the USA and it rarely sees a 4 degree one, and when it happens it makes it to the US national news (and sometimes even to the news back home, but as a comedy break because people don't even think about getting out of bed if it's not a 6).

I'm not sure about hurricanes, but maintenance can't be much different as rotten wood and moldy bricks are both a problem. Maybe insulating bricks is more expensive?

> This lesson is taught in history classes to 10 year olds, and they don't tend to go into other countries' construction traditions, or reasons not to use bricks.

Cultural differences don't help here, in the US people think about rebuilding homes way more often than people in Europe, so there's this mindset that the home doesn't need to last that long because it will be rebuilt anyways. This shorter life span, "freedom" and profits thanks to lower costs also call for little regulation that forces the building code to aim to survive the regional disasters from the past 60+ years. California's fire code is probably an outlier, but SF had to burn down for the regulation to come out.

It helps with availability of materials if people don't expect to have like 500sqft per person. But that's not how modern houses are built in US, at least not in my neck of the woods (Seattle suburbs). As for the quality of housing, I'm from ex-Soviet satellite state and lived in a prefab apartment block - yeah, it was a bit dated but no major problems with quality that I could tell. The main nuisance was lack of acoustic insulation.

Termites are only a problem if you enable them with a source of moisture. If you have termites eating your house something else has gone very wrong.

> That is actually how pretty much all new houses in the UK are constructed

This claim struck me as unlikely, so I did a quick fact check.

Accroding to the most recent report I could find[1]: "Figures from the National House Building (NHBC) suggest that timber frame market share has developed from 19% in 2015 to 22% in 2021 and that market conditions, as described above, present the opportunity for this to develop to circa 27% by the end of the forecast period (2025)"

This appears to be driven by Scotland where 92% of new builds were timber framed in 2019, while in England (where the majority of new houses are built) it was just 9%.

[1] https://members.structuraltimber.co.uk/assets/library/stamar...

Its a country built on seismically active volcanoes.

If there's earthquake insurance in japan, it should be do-able.

"In and around Japan, one-tenth of earthquakes in the world occur. " https://geoscienceletters.springeropen.com/articles/10.1186/...

Why would anyone tear down a 20 year old house? Where I live the houses are 80-100 years old and they’re better built and nicer to live in than most newer homes.

This sounds evil. Why protect the rich when the states always spend huge to help the the poor?

It was based on some reports (or podcast? I can't remember) that the California government didn't allow the insurers to sufficiently increase their premiums in the burnt areas. The government (or the insurers) cited two reasons: there was a rule that the annual increase should be no more than 7%, and that if they want to make an exception then the insurers must increase the premiums for all the insured areas instead of setting the price by risk. As a result, the insurers stopped insurance renewal for about 60% of the burnt properties. I assume the intention is to protect the insured or to ensure certain equity, hence the use of the term "ideology". FWIW, it thought it was a neutral term, implying that it's a strongly held fundamental belief.

California's insurance policies are more strange, due to proposition 103, passed in 1988.

It creates a condition where the state can prohibit insurers from selling to residents, if it doesn't like their prices, which has recently lead to a lot of insurers no longer selling in the state, as construction prices in the state have risen significantly faster than inflation, leading to insurance premiums that the state doesn't like.

Residents who no longer have any insurers available can buy insurance from the state, but its far more expensive than the plans it rejected from private insurers.

> There's no universally-accepted "ideology of California." It's a big state with a huge, diverse population.

Population is diverse and large, yes, but the state government (including the insurance commissioner) is radically biased left/progressive and has been for decades.

Climate change is gonna be really expensive. Some people have tried to point this out.

Pakistan mentioned! Let's go!!

For sure, they're not fireproof of course, but they do survive and seem to be more resistant than non-native species [1].

And, like all things, of course there are many interdependent pieces in play, like those hurricane force winds, but oak trees don't burn the same as a palm [2]. I just keep seeing that viral video of a firefighter trying to put out a palm while a guy escaped his house on a bike -- it was shedding embers like crazy. [3]

[1] pdf warning: https://www.fs.usda.gov/psw/publications/documents/psw_gtr21...

[2] https://abcnews.go.com/US/elderly-couple-battles-flames-la-f...

[3] https://www.nbclosangeles.com/news/california-wildfires/pali...

Health insurance's issue is probably how it induces pure waste everywhere as everyone has to play this dance of ever escalating paperwork which consumes a lot of labor. It's not profit, it's waste. Same with the ever increasing amount of admin. Why is that admin increasing? I estimate insurance or requirements created by insurance is part of the cause.

There is also a lot of other smells of a lack of a competitive market. Very opaque pricing, limits to how many hospitals can be opened in a region, needing paperwork to push against that limit, limits in residency slots, the entire hazing ritual of residency in the first place, limits in opening medical schools, ever escalating requirements to become a doctor, restrictions against doctor owned hospitals or clinics, the fact something like an epipen is still not out of patent and not having many clones by now, large barriers to make medical devices and medications, while simultaneously having great issues with generic drug quality, a horrible food system compared to Europe, while simultaneously having a much harder regulatory state medically compared to europe, etc.

> When you point out that, for example, health insurance profits are low single digit percentage of overall healthcare costs they just don’t believe it.

Meanwhile, the health care providers:

> But if you look at the list of companies with the highest [return on equity], you see health care providers or suppliers like HCA Healthcare (272%), Cencora (234%), Abbvie (84%), Mckesson (84%), Novo Nordisk (72%), Eli Lilly (59%), Amgen (56%), IDEXX Laboratories (53%), Zoetis (46%), Novartis (44%), Edwards Lifesciences (43%), and so on. If you want to know which shareholders are making the real money in the health care industry…well, it’s the shareholders of those providers and suppliers.

* https://www.noahpinion.blog/p/insurance-companies-arent-the-...

> When you point out that, for example, health insurance profits are low single digit percentage of overall healthcare costs they just don’t believe it.

When you consider that single digit percentages of trillions of dollars is still an obscene amount of money it makes sense. People making tens of billions by applying formulas to spreadsheets and shuffling other people’s money around doesn’t sit right with most people.

The profit margin doesn't include things like CEO salary, correct? I could see a scenario where the issue is still corporate greed just not greed that's measured by profit.

  When you point out that, for example, health insurance profits are low
  single digit percentage of overall healthcare costs they just don’t
  believe it.

You ever think it's curious that for-profit insurance companies pay out 2–3x what Medicare does for the same procedures?

>When you point out that, for example, health insurance profits are low single digit percentage of overall healthcare costs

Do you have any source for this?

I’m assuming (because HN) that you had the USA in mind, and it doesn’t pass the sniff test for me given that US insurance fees are more than single digit percentages higher than other high quality care countries with privatised healthcare systems

You do realize health insurers have federally mandated caps on their profits, which simply incentivizes creative accounting to make money in more oblique ways, right?

>When you point out that, for example, health insurance profits are low single digit percentage of overall healthcare costs they just don’t believe it.

It's not that I don't believe it, it's that this figure is completely unrelated to the damage and waste caused by the system of healthcare and health insurance we have in the US.

I mean, in a system of chattel slavery, you see above-normal profits competed away, but that in no way means the system isn't exploiting anyone, because that's not how the harm shows up! And yet still we'd see that argument get batted around in comments like yours:

"No, your owner can't possibly be exploiting you because, when you consider your purchase cost, he doesn't actually make much profit!"

Soon, people will realize that the entire economic system that caused climate change in the first place will not save us. Once we stop sacrificing our lives in the name of Almighty Profit, then maybe we can move forward and come up with solutions that aren't just "lol stop living in LA".

Your statements contradict each other, don't they?

In the many many complaints I have heard about the insurance industry, nobody has complained about them acting as an oligopoly or about a lack of competition.

Further, pricing is extremely regulated in terms of what can be factored in, so being an oligopoly doesn't have much impact on that.

Why does State Farm in particular have a moral obligation to insure you against fire if it’s not profitable for them to do so?

To pick random examples of unrelated companies, McDonalds or SpaceX would also refuse to insure you against fire. Why should people hate State Farm for this reason, but not McDonalds or SpaceX?

If State Farm didn’t exist and the state ran insurance instead, and were willing to insure all comers, they’d be subsidizing people who can’t be insured profitably. That’s not crazy on its face (the state subsidizes lots of different things), but it’s at least worth asking why we should be paying for people to live in high-fire-risk areas rather than any number of other things the state could be spending those resources on.

My insurance was cancelled but I don’t blame the insurer at all.

CA regulation basically capped their premium increase and my insurer did calculations that said “this is a net negative business”.

If I had a business making a loss I would get out, so why would I blame my insurer for doing the same?

If you only had two weeks notification, you should file a complaint with the commissioner here:

https://www.insurance.ca.gov/01-consumers/101-help/index.cfm

It's likely that you are not alone, but I've not heard of anybody not getting notification, despite a lot of people not getting renewed.

State Farm is a mutual insurance company, so it's owned by its policy holders. It's not quite non-profit, but it's in the same ballpark. I've gotten money back from State Farm one year when they (we, I guess) made too much money.

State Farm notified its customers in August of its non-renewal (not cancelling) of policies, plenty of time for homeowners to get new policies or fall back to the state fund.

And what is fire insurance? Is that something unique to CA?

https://www.clydeco.com/en/insights/2025/01/california-wildf...

> The Bulletin was issued pursuant to California Insurance Code section 675.1(b)(1), which states that an insurer “shall not cancel or refuse to renew a policy of residential property insurance for a property located in any zip code within or adjacent to the fire perimeter, for one year after the declaration of a state of emergency . . . based solely on the fact that the insured structure is located in an area in which a wildfire has occurred.”

That’s insurance?

Change the euphemism from government to private insurance to satisfy capitalism gods and keep their giant foot from squishing us… still “on the books” as a co-mingled pool of funds to shift around to solve problems.

Aw …sad… other people exist and need resources too. Not just about your first world skin suit playing temp host to a run of the mill electromagnetic field effect.

For new buyers, yes, but there's plenty of people who already have a house but now they have no insurance for it. And sure, the terms of their mortgage say that they have to have it, but what can the lender do if nobody will insure that particular property no matter who the current owner is?

> Steel frame, flame retardant insulation and cladding, rammed earth, .. these are all options.

Don't even have to go that far.

Wood framing is fine: make your cladding stucco would do a lot (or brick). You can even have siding as cement-base stuff is available:

* https://www.jameshardie.com/blog/siding-types/what-is-fiber-...

You could have metal or clay roofing, but shingles with a Class A rating is available as well:

* https://www.ameriproroofing.com/blog/asphalt-roofing-shingle...

> flame retardant insulation

Which are almost definitely known to the state of California to cause cancer.

Yes absolutely, and as another poster pointed out, earthquake codes exist. Metal framing is probably a bit easier to adapt to the same earthquake codes that timber framing has.

That's false. Hurricanes are not getting bigger or more frequent due to climate change.

They aren't getting bigger or more frequent at all.

NOAA has stated this multiple times and you can read an article addressing it here:

https://www.climate.gov/news-features/blogs/beyond-data/can-...

It's well known that hurricanes go through multidecadal swings.

Why this keeps getting repeated when it's obviously false is beyond me.

The US has a practically limitless amount of wood. Europe doesn’t. Wood also holds up well to earthquakes and can be treated to hold up to fire. And if there’s a catastrophic failure, it hurts a lot less than concrete does when it falls on your head. It’s a great material that the US is right to use.

> We, the non-USA folks, are looking yearly at either fires or hurricanes destroying these wooden houses there and people keep rebuilding them.

You can build wood framed (2x4, 2x6) buildings that are resistant to fire:

* https://www.youtube.com/watch?v=yZe-TlYxm9g

A stucco, brick, or fibre cement siding, have 2m/6' clear around the base of your house, tempered windows, and either a metal roof or shingles with a Class A fire rating.

Earthquakes make this a much more expensive option. To give you some idea, the design seismic acceleration for my house is like 3g. That's more sideways than down. The forces involved are the weight of the structure times this value. Concrete ways a LOT more. It absolutely can be done, but it's not clearly a superior material compared to wood.

The rest of the world has mudslides, floods, earthquakes, volcano eruptions, etc. Or they have no natural disasters, just like so many parts of the US.

> We, the non-USA folks

Isn't that a sad way to look at yourself?

> I feel like government stepping in and being the insurer with a sufficiently large pool of risk to spread around lets them set a fair rate without the need to make a return or answer to shareholders.

Youre about 20-30 years late to the game, but arrive in time to see the conclusion does not match your assumption. See california for fire, florida for fstorm damage, and everywhere in the us for federal flood coverage. It doesnt work. CA FAIR has higher rates to account for increasing the coverage pool, but it doesnt look like premiums will cover the current or future loses. Which is the universal story when your policy attracts all the high risk/payout buyers. And FAIR, roughly, is setup to go recoup losses from all the _other_ insurance providers in the state. Even ones not insuring those policy holders _or that type of insurance_. Its just a layer of indirection to subsidize fire risk against all poly holders.

> To some extent this has helped with health insurance. Each year I get a check back from my insurer saying they didn't spend enough on my care vs my premiums.

This has baffled me ever since Obamacare was first passed - it seems that each year the insurance companies have an incentive to drive up the cost of healthcare, since that’s how they earn more money in absolute terms. Is it not so?

> How about profit caps?

Transfers wealth from shareholders, patients and taxpayers to management, bankers and intermediaries.

Broadly speaking, caps are stupid—akin to treating liver enzymes directly when they spike versus seeing them as the sign of deeper problems.

Sure. Because the response of a failure in governance is more government? What you are proposing is "unfair". You are essentially suggesting that the rest of the country subsidize a subset who wants to live near high-risk areas. Me too want to live in a dense forest and also have my house by the edge of the river.

You could make the argument for this for healthcare, since no one can choose which illness he is born with. But choosing your housing location is a "choice". And you can/should move somewhere else where it is less risky.

Profit caps presumably create perverse consequences. If the profit I'm allowed to make is proportional to X, then I'm incentivized to maximize X. If X is my costs, then... Maybe that's where these unbelievably high line items on medical bills come from.

Insurance companies have pretty thing profit margins regardless, even in areas where profits are not capped. It's a competitive marketplace!

> How about profit caps?

What period do you put it over for property insurance? Profit caps work for health insurance because claims are typically not correlated. The percentage of your customers with cancer won’t 5x one year and go back to baseline the next. New drugs or treatments (or a drug going off patent) can cause correlated swings, but generally costs to health insurers don’t change a lot year to year.

For property insurance, you need to bring in profits most years to fund the year when there are multiple category V hurricanes or large fires.

Or maybe C-suite pay/benefits caps, ha ha.

Insurance Companies do need to make a profit and Local, State and Fed Gov is allowing building in very risky areas. Just look at Florida, that is a very risky area for weather and sea rise.

So in reality the burden is falling on Insurance Companies. High rates will in a way prevent building in those areas.

The key thing to understand is that you don't get to choose when the house gets destroyed or get advanced notice. Which means you might be in there, or your kids, or all your belongings. But yes, after you're dead in the rubble someone else can rebuild your house and it might be cheaper.

How about the cost of your life? If the house resists the earthquake and you are inside it, you don't die.

Maybe be there is no longer "cheap" and that's the issue

Maybe people don't like to restart their lives like that if it's avoidable, even if it costs more.

Only you also take into account your cheap home will likely accelerate the problem. Which never happens.

in case of earthquakes: to not to die.

Hah financialization strikes again. Try explaining this to a person from a third world country, they would say "what are you talking about". Also they would have better health care than your average American.

What collapsed was the newly rebuilt part of the porch, not the old one built to those codes. It has nothing to do with insufficient building codes, hence a corruption scandal.

> Florida was obliterated in 2024

That’s an huge exaggeration. FL was not obliterated in 2024.

Stats:

Total storms 18

Hurricanes 11

Major hurricanes (Cat. 3+) 5

Total fatalities 401

Total damage $128.072 billion

(Third-costliest tropical cyclone season on record)

> ideally nobody has living memory of the last [...]

Funny, I would have said the exact opposite. If people forget how bad things were, they seem more likely to repeat them.

Nazism, for one. And the rise in antivax sentiment - people today have never come across an iron lung, which is a testament to medical technology, but it means some silly opinions get way more traction than they should.

"Those who cannot remember the past are condemned to repeat it" - George Santayana

All the properties that survived in those LA neighborhoods all had some pretty basic and intentional fire resistance

I’m curious about how many others did that burned down too

But so far the ones highlighted had super obvious mitigations that its astounding to see were not more common

The fire problem can be managed by burning or removing some of the dead wood, and building adequate water storage. Apparently California has been neglecting those two problems for decades.

The government banned insurance companies from raising prices. They used tax payer money to subsidize this for a while which increase home prices. Eventually insurance companies stopped offering insurance.

When state actors even dabble in socialism disasters happen people die.

If the regulators have defined 'price gouging' as a price substantially below the break even mark, literally any profitable insurance product is implicitly believed by them to be price gouging. The US does a weird thing where "insurance" no longer means pooling risk but some sort of transfer payment welfare system. If they're going to define "price gouging" as profitable activity it is hard to see how the economy is going to function.

Allowing insurers to make a profit and run a business without interference is going to be cheaper - and in most instances better - than whatever the politicians are trying to build here. If you get rid of all the mandatory-this and price-gouging-thats then to stay in business insurers have sell products that people want to buy at a competitive yet sustainable price. It works for food, it'd work here too.

> unregulated insurance market; price gouging.

with sufficient competition, it is impossible to price gouge.

So if there is supposed price gouging, then there must be insufficient competition. Therefore, the source of the lack of competition would need to be removed (ostensibly, by gov't - such as increasing business loans so that new insurance companies can be started).

For what it’s worth, you can get a house with no insurance or mortgage. They tend to be cheap. I had an uninsured thatched cottage for a while, it was 68k

Price gouging isn't actually what we're seeing in the most disaster prone areas. Insurance companies aren't charging open ended prices, they're simply exiting the market. Florida for example.

Insurance (at least the kind we are talking about) is only mandatory if you have loans, and even then it is not 100% mandated. We do need insurance regulations, but price caps limit what things actually make sense to cover. To put it another way, you are free to buy land in a risky area if you want, but nobody has to insure it or loan you money for it. If you find someone who will loan you the money if you can get insurance, then you can't get insurance, that sucks for you but nobody owes it to you to hand over money on a losing investment. These requirements can be abused, but there really isn't much evidence of insurers, lenders, and investors colluding to rip people off.

The big risk that we need regulation for is not that insurance charges too much, but too little. There will always be the temptation to charge less than the other guy, get lots of customers and hope nothing really bad happens.

P&C insurance is a pretty competitive industry, and there are plenty of mutual insurance companies in the P&C business that don't have a price gouging incentive. Most of the regulations that are about reducing counterparty risk for the insured are probably necessary, but price controls are not, and generally, they only distort the market.

Can you define “price gouging”?

> Resistant homes will pay nearly the same prices as everyone else.

but this means the insurance company is mispricing (or is being forced to misprice) the risk of resistant homes.

In theory, when correct pricing happens, these resistant homes should face less claims, and thus the premiums paid on them is high profit margin; ala, the customer is a good one, and the insurer should persue this customer more than another. This ought to results in a discount for said customer's premium, as more insurers vie for this customer over another.

This is more a matter of market rules than an inherent property of insurance; currently we do not let insurers get sufficiently granular due to some assumptions about wider social benefits of a less individualised system.

This might be reworked to allow for fire resistant designs to be a factor.

> Biggest factor is age, and even then, difference between 20yo and 35yo driver is 38%.

That's because age is both observable and strongly predictive of risk.

Interesting video, didn't know about truss plates

One of my daughters was born with moderate to severe autism. There's no obvious cause. I'm told that from what we know it's at least 10 different factors that go into it, one of which is environmental pollution. So maybe corporations are partially at fault.

If I could cure it (yes, I'm using that term. It's a debilitating condition and she'd be better off without it) by selling my house and moving hundreds of miles away from family I'd do that in a heartbeat without complaint. All we can do is make the best of things.

People don't understand the exponential change. As you correctly stated, the effects of climate change are exponential. Why? Because if you take a normal distribution and shift it linearly, the area on the edges grows exponentially. This is why even a linear shift in temperature can lead to an exponential rise in disasters.

Math is hard for people, even on HN.

More like can't care about anymore. Median household income is 63k in OK and housing costs are through the stratosphere, it's no wonder people will pick any home over none.

Yes, as a European I'm always confused about what Americans think is the moral of that story..

Brick does tend to survive. Brick as an insulating layer can save lives. Brick also explodes violently under conditions where wood merely burns. Neither of these save homes in our wildfires, though; it turns out what saves homes is things no one realized at first:

Don’t plant trees within fifty feet of a structure. More, if you didn’t inflate your home like a balloon to fill a property to the brim with home. Cut them down and make a firebreak. Clearings exist for a real and serious reason. Aesthetics have been given precedence far too long in this regard.

Make your home airtight (or positively pressurize it, if you have the power and tech to do that safely) so that embers don’t get pushed in by the winds and pulled in by the temperature differential currents and catch your house on fire from inside its walls. Not much fun in having a brick building burned out from embers that were forced in through a poorly-sealed door.

Saturate your roof with water, so that it doesn’t trap embers and act as a fire repeater to the next house on the block. Not only will your roof not burn, but every ember that lands on it will likely go out. Even if your roof is metal, consider installing sprinklers anyways. Maybe you’ll help save your neighborhood someday.

It’s not the building material that’s the one problem here; it’s the carelessness of building code, safety enforcement and absence of federal and state aid to fireproof homes in known fire zones. It’s the catastrophically incorrect hundred year old policy that would rather burn down a chunk of homes every ten years rather than admit that policy is wrong and that the indigenous people were right all along. Brick or wood or concrete or steel, none of these will stop the hottest fires with any certainty. We know what does, and we’ve allowed it to become unsafe to have wood homes. We know how to stop these wildfires. Build with brick if you like, but:

Only fire can prevent forest fires.

I am not sure the wood framing matters much in this case. The fires are burning houses because the roofs are flammable, or embers are getting in the house through the eaves or a broken window. So in the end you have a completely burned down wood-framed house or a hollow concrete house that is no longer structurally safe.

WW2 saw urban firestorms in European cities built of brick. The insides are still flammable.

Isn't that overly pessimistic, not optimistic?

Surely if plants are absorbing more CO2 than we thought, that's a good thing for climate change? (More CO2 absorbed by plants -> less CO2 staying in the atmosphere -> less warming. No?)

I don't understand this reasoning. How does the presence of a single recent post on HN say anything about if the errors go in one direction or in both directions?

The errors on direct influences to warming have been overwhelming on the "too optimistic" direction. We are above the most pessimistic predictions from decades ago.

The errors on consequences of the warming... I'm not sure one can even talk about them without citing specific studies, because those things tend to have undefined timeframes and way into the future contexts (like this 4°C one... is this even possible to achieve by burning fossil fuels?)

There are 2b+ people living in "inadequate housing", don't have sewers, don't have running water right now, we can't even fix the problem now, we're not going to fix it better when 2b more need AC to survive every summer

https://unhabitat.org/news/13-jul-2023/the-world-is-failing-...

It's not just expensive. Steel and concrete are some of the largest drivers of CO2 emissions and toxic waste, in the ballpark of 15%! So really the only sane choice is to avoid building new homes whenever possible and try to keep old houses in use as long as possible.

???

Technology has been around for hundreds of thousands of years. What are you defining as "technology"? Software as a service chatbots? Because those aren't saving anyone.

And 227000 people died 20 years ago in a tsunami in Indonesia. They had cell phones and the internet. Is that pre-technology? 50 million died in famines in China in the 1950s. They had TV, radio, and computers. Is that pre-technology?

Technology is just tools that humans make to solve a problem.[1] It's not magic. And in the case of the Japanese tsunami, the most basic technology that humans have had for tens of thousands of years saved countless lives: just building a wall, and making it tall enough to block rising water. [2] But wrapping an entire country in walls is kind of unfeasible. And you can't protect the entire world. We never know what kind of disaster will strike next, and technology to protect us only develops after we suffer the consequences at least once.

[1] https://en.wikipedia.org/wiki/Technology#Prehistoric

[2] https://www.japantimes.co.jp/photo-essay-the-seawalls-of-toh...

Technology can't save you from famines when there isn't enough sunlight to grow crops for a season or two. One good supervolcano and civilization might collapse or at least take such a hit as to be utterly transformed. Billions dead, etc.

The Green Revolution has so far just postponed famines. We are farming in an unsustainable way. We're running out of fertile topsoil and are depleting fossil aquifers in many regions of the world. Inorganic fertilizers might become scarce in the foreseeable future too.

One thing worth noting about these agriscience improvements you're touting would be they require a combination of non-renewable inputs and unsustainable amounts of water. There is also the minor issue of unrecoverable topsoil depletion and the steady decline of nutrients in agricultural products tracked over decades. Kicking the can down the road isn't the same as solving the problem.

You selected pre-climate change examples. How curious.

Another example: Japan has many quakes per year and has a strangely high percentage of the world's active volcanos. People have lived there for a very long time, built to accommodate it (both traditionally, using timber and expecting to rebuild often, or with modern earthquake-hardened architecture), and is now a top five economy by GDP.

And, well, most of the US is just a hanger-on to California's economy.

The cost of labor is extremely high in the US compared to Bangladesh, and that along with building standards, minimum lot size, minimum floor space requirements and required low density zoning (lmao) make these two case very different

So is living on the sea bed. It's irrationally expensive and inconvenient, which is why we don't do it.

Living in areas in constant danger of flooding and/or burning and/or storm wind damage and/or drought seems like quite an eccentrically inconvenient lifestyle flex.

Unless you like disaster movies.

Wildfires can also be avoided by letting forest management people dictate forest management policies instead of environmental activists, and by prioritizing the people that live there over the animals.

> Build much bigger sewer pipes

Great, now in a storm surge (which is the most destructive part of most hurricanes), you have built an effective system for transferring rising seawater into your urban area!

> and river beds.

Great, now you've completely eradicated the delicate ecosystem that was living there and everything that depends on it.

> Build houses higher.

That is how a lot of coastal houses are built. But now you're more susceptible to wind damage, so you're playing a risk balancing game.

Every time a natural disaster shows up, nerds starting inventing solutions. I love the optimistic spirit behind that impulse. But at the same time, people living in those areas, including generations of civil engineers, having been thinking about this a lot longer than us.

The solutions are known but most either have even worse externalities, or simply take a long long time to roll out.

Any solution relating to housing is particularly slow to ship because, surprise, people don't like being forcibly kicked out of their homes. So houses basically only get upgraded at the rate that people die.

I am in Florida. We have Winter, Summer and Hurricane Season. It's an yearly thing. Hurricanes get stronger every year due to warming waters in Gulf of Mexico.

There are bigger Hurricanes in oceans but since no Humans live it doesn't make the news.

Desal plants use static mixers to mix the brine with a bunch of ocean water and pump it back out. The specifics depend on the local ecology and ocean currents but it’s a matter of making the outfall pipes long enough (they’re kilometers long usually).

Brine is probably very valuable.

If we make it a slurry, perhaps we could use it to pump to unpopulated areas with endorheic lakes like the Salt Lake or Salton Sea, then mine and refine the resulting slurry.[0]

The concern is the brine getting into the atmosphere -- that can likely be mitigated.

[0] https://oceanservice.noaa.gov/facts/gold.html

https://www.scientificamerican.com/article/slaking-the-world...

I'm guessing there's local ecology issues with this? Groundwater seepage, etc. Though that hasn't really stopped fracking so maybe it'll just be a non-issue at the policy level.

and storing cheese

I have a very visceral response to people who say things like "tough choices must be made" when it's notable that they will not be making those tough choices, nor will have those tough choices impact them, and will instead be apparently playing musical homes for the best personal outcome.

Like I'm glad your personal wealth is going to let you skate out of the worst effects of climate change (so you think/for now). That is far from a universal experience and "tough choices need to be made" in this context sounds a hell of a lot like euphemistic language for "a lot of poor people are going to die, at least if they're too poor to afford to rent my spare homes."

wow 100k for 2 cars. that's expensive.

>I don't blame some people

You should. Just because something is imperfect doesn't make it bad. Should the truck loophole be closed? Yes. Has CAFE improved every other class of vehicle? Yes.

>I don't blame some people for wanting to scrap the whole regulatory system after encountering enough of these.

Regulation can used to save lives and improve outcomes, but it can also be used to suppress competitors or favor a particular business practice and stifle innovation.

But isn't the issue that I may have been living in an area for decades and because the government didn't correctly price/deter externalities, now I can't afford to live somewhere? The companies lobbying for the abilities to pollute and otherwise add risk to the world can afford to pay the higher insurance rates. The folks who live in the areas they put at risk often can't.

Insurance costs rising are a good signal, but they're essentially a way to tax normal people for the faults of governments and major companies. It does reflect the real risk, but it's not like the fact of people living in most of these areas is the reason the area is risky.