Comment:
The insurance industry is committed to working in partnership with public policymakers, No no this is a big NO. Get Policymakers out of the insurance industry. Tell Policymaker do not look at all the money-work for the people not all the boys with the $$$$$$$$$$$$$$. make laws that stop all the waste. You do not have to be a insurance agent be a policymaker to do things right.
If the private insurer sector will not provide insurance coverage when and where it is most needed, then it is the role of government to meet the need and fill the void. The insurance industry has no grounds to complain….they chose to abandon certain high risk areas such as flood and coastal exposures.
What I find disturbing is that the insurance industry has collected higher rates in places like Florida and other coastal areas for decades for the very reason that they have this added exposure. Insurers were lucky for more than 30 years that they did not get blown out of the water (no punn intended) years ago but in the meanitime they collected billions in premiums and pocketed billions in profit. Finally they get whalloped and now they want to take their marbles and go home.
No doubt some would suggest that those living in coatal areas pay 100% of the cost to insure against this exposure. That would be no more realistic than saying people in the midwest should bear full cost of torndoes which are prevelant in that part of the country. Insurance is intended to spread the risk among a large number of insureds.
I just find it ironic that the insurance industry would complain that the public sector is filling a void they created. But I should not be surprised as they have done the same in health insurance where the cronically ill and those most at risk cannot buy health insurance or can’t afford it but hen they rail against universal health care or other similar programs.
The insurance industry has powerful lobbyists and contributes millions to the elected officials. They are truly a favored business in this country and receive including tax laws that greatly encourage the purchase of their products and allow them to deuct resrves long before they ever pay the loss.
Thank you, rolfneu, for posting at least what is a classy and intelligent response – whether people agree or not – you at least have something worthwhile to say – and by the way – and I do agree with you
Linda, while I don’t necessarily agree with your opinion on the topic at hand, I do enjoy reading a good debate/discussion. That said, I whole-heartedly agree with your last comment on IJ pulling Heath’s posts.
Thoughts from the consumer perspective, which are based on individual responsibility and the acceptance of the consequences of your decisions:
Risks should be stratified and spread within like classes and premiums priced accordingly. For example, all coastal properties would be in one class. It is not fair for someone with little or no risk to have to bear the premium burden of those subject to high risk. This still spreads the risk, but among similar properties. If someone chooses to live in a high risk area, one of the consequences is risk and comensurate insurance premiums. Automobile insurance is priced this way. Those drivers most likely to have accidents are charged at higher rates.
The issue with the state run insurers of last resort is that they are established by politicians who are not fiscally responsible. The coverage is priced to win votes and has no relationship to the associated risk. As a result, the costs of a catastrophe will then be assessed among all policy holders, and likely all taxpayers. On a federal level, the results of the actions of inept politicians of one state should not be borne by other states.
The private sector will provide insurance coverage. It is just that the pricing, while comensurate with the risk, may be deemed unacceptable. This is where the politicians step in and do not let the markets operate efficiently. Insurers want to abandon some markets because politicians will not let them charge a rate comensurable to the risk.
Again, it goes back to responsibility. People should bear the consequences, fiscal or otherwise of their decisions.
They typically emerge for two reasons: (1) States consider it too much of a public policy issue to permit carriers to charge the correct price for individual risks, therefore suppressing rates, and (2)Companies find it impossible or prohibitive to secure the necessary risk transfer mechanism, aka reinsurance, to spread their business risk. The interesting thing is that the state-run mechanisms fail in these areas as well, leaving them to assess residents, insurers and a variety of businesses in the event of catastrophic events they can’t financially cover.
The ultimate failing of these mechanisms is that, unlike the insurance industry, they invariably and dangerously concentrate (as opposed to spreading) financial risks, placing a large toll on a state’s populace and the federal government. Alas, when one commits to live on the coast, there tends to be little to no guilt associated with the fact the risk cost is being subsidized by someone else. It’s this state government-enabled point of view that sends the voluntary market packing.
Of course, one day someone will be able to point to a successful state-run property insurer. I doubt that anyone in this thread, however, will live to witness it.
Most fishermen I know will not live right on the water……we know what the ocean will do, emphasis on will. However, we live in coastal communities and supply the entire country with all that delicious fish they so enjoy. I’ve seen the million dollar mansions swept away in my community. In 30 years as an adult and 20 in my parent’s home, I’ve yet to suffer a weather loss. My house is in a sensible location, although about 1k ft away from the ocean. My insurance bill has tripled. It’s not the entire coastal community. It’s just the idiots who build on sand bars and across from rocky shores who act irresponsibily that have caused this problem.
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Comment:
The insurance industry is committed to working in partnership with public policymakers, No no this is a big NO. Get Policymakers out of the insurance industry. Tell Policymaker do not look at all the money-work for the people not all the boys with the $$$$$$$$$$$$$$. make laws that stop all the waste. You do not have to be a insurance agent be a policymaker to do things right.
Heath, you are disgusting. Feel free to leave.
If the private insurer sector will not provide insurance coverage when and where it is most needed, then it is the role of government to meet the need and fill the void. The insurance industry has no grounds to complain….they chose to abandon certain high risk areas such as flood and coastal exposures.
What I find disturbing is that the insurance industry has collected higher rates in places like Florida and other coastal areas for decades for the very reason that they have this added exposure. Insurers were lucky for more than 30 years that they did not get blown out of the water (no punn intended) years ago but in the meanitime they collected billions in premiums and pocketed billions in profit. Finally they get whalloped and now they want to take their marbles and go home.
No doubt some would suggest that those living in coatal areas pay 100% of the cost to insure against this exposure. That would be no more realistic than saying people in the midwest should bear full cost of torndoes which are prevelant in that part of the country. Insurance is intended to spread the risk among a large number of insureds.
I just find it ironic that the insurance industry would complain that the public sector is filling a void they created. But I should not be surprised as they have done the same in health insurance where the cronically ill and those most at risk cannot buy health insurance or can’t afford it but hen they rail against universal health care or other similar programs.
The insurance industry has powerful lobbyists and contributes millions to the elected officials. They are truly a favored business in this country and receive including tax laws that greatly encourage the purchase of their products and allow them to deuct resrves long before they ever pay the loss.
Thank you, rolfneu, for posting at least what is a classy and intelligent response – whether people agree or not – you at least have something worthwhile to say – and by the way – and I do agree with you
Rolfneu you hit the nail on the head! I totally agree with you.
Linda, while I don’t necessarily agree with your opinion on the topic at hand, I do enjoy reading a good debate/discussion. That said, I whole-heartedly agree with your last comment on IJ pulling Heath’s posts.
Thoughts from the consumer perspective, which are based on individual responsibility and the acceptance of the consequences of your decisions:
Risks should be stratified and spread within like classes and premiums priced accordingly. For example, all coastal properties would be in one class. It is not fair for someone with little or no risk to have to bear the premium burden of those subject to high risk. This still spreads the risk, but among similar properties. If someone chooses to live in a high risk area, one of the consequences is risk and comensurate insurance premiums. Automobile insurance is priced this way. Those drivers most likely to have accidents are charged at higher rates.
The issue with the state run insurers of last resort is that they are established by politicians who are not fiscally responsible. The coverage is priced to win votes and has no relationship to the associated risk. As a result, the costs of a catastrophe will then be assessed among all policy holders, and likely all taxpayers. On a federal level, the results of the actions of inept politicians of one state should not be borne by other states.
The private sector will provide insurance coverage. It is just that the pricing, while comensurate with the risk, may be deemed unacceptable. This is where the politicians step in and do not let the markets operate efficiently. Insurers want to abandon some markets because politicians will not let them charge a rate comensurable to the risk.
Again, it goes back to responsibility. People should bear the consequences, fiscal or otherwise of their decisions.
They typically emerge for two reasons: (1) States consider it too much of a public policy issue to permit carriers to charge the correct price for individual risks, therefore suppressing rates, and (2)Companies find it impossible or prohibitive to secure the necessary risk transfer mechanism, aka reinsurance, to spread their business risk. The interesting thing is that the state-run mechanisms fail in these areas as well, leaving them to assess residents, insurers and a variety of businesses in the event of catastrophic events they can’t financially cover.
The ultimate failing of these mechanisms is that, unlike the insurance industry, they invariably and dangerously concentrate (as opposed to spreading) financial risks, placing a large toll on a state’s populace and the federal government. Alas, when one commits to live on the coast, there tends to be little to no guilt associated with the fact the risk cost is being subsidized by someone else. It’s this state government-enabled point of view that sends the voluntary market packing.
Of course, one day someone will be able to point to a successful state-run property insurer. I doubt that anyone in this thread, however, will live to witness it.
Rolfneu, well put!
Most fishermen I know will not live right on the water……we know what the ocean will do, emphasis on will. However, we live in coastal communities and supply the entire country with all that delicious fish they so enjoy. I’ve seen the million dollar mansions swept away in my community. In 30 years as an adult and 20 in my parent’s home, I’ve yet to suffer a weather loss. My house is in a sensible location, although about 1k ft away from the ocean. My insurance bill has tripled. It’s not the entire coastal community. It’s just the idiots who build on sand bars and across from rocky shores who act irresponsibily that have caused this problem.