[HN Gopher] Why insurers worry the world could soon become unins...
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Why insurers worry the world could soon become uninsurable
Author : mooreds
Score : 24 points
Date : 2025-08-10 21:19 UTC (1 hours ago)
(HTM) web link (www.cnbc.com)
(TXT) w3m dump (www.cnbc.com)
| whatwrongwyou wrote:
| This seems based on outdated science to me. The world isn't just
| "getting hotter", the overall climate is changing due solely to
| human influence. The article makes it sound like insurers believe
| houses will start spontaneously combusting. What they should
| really worry about is desertification in populated areas and
| flooding along the coasts, and the inevitable humanitarian crisis
| and necessary social restructuring that those will require. We
| can't leave this to insurers - we need strong cooperation between
| governments and academia to plot a better course into our brave
| new world.
| anoxor wrote:
| "the overall climate is changing due solely to human
| influence."
|
| Way past anything scientific. Spend 2 minutes googling
| "anthrophemoric co2 percentage"
| oezi wrote:
| Well solely is dramatizing but to a large extend it is true
| that the clima is changing because of human actions.
|
| Certainly the rise in Co2 from 280 ppm to 420 ppm since the
| onset of industrialization is rather very likely due to human
| actions.
| lazyasciiart wrote:
| Because they're the ones who are supposed to pay money when shit
| blows up, and they are finally at the point where the giant
| flaming signs that it's going to all blow up are within
| foreseeable shareholder ownership periods.
| Xylakant wrote:
| Insurance is supposed to average out small probability high
| impact events across a large number of smaller payments from
| more people. It is entirely expected to loose money on
| insurance as a single customer - that's usually great. It means
| your house hasn't burned down, you're in good healt and you
| bike hasn't been stolen. If we're now moving towards a world
| where due to man-made climate change certain classes of risks
| are no longer insurable, everyone looses.
| esseph wrote:
| I would think insurance would be among the least of worries?
| RowanH wrote:
| Chunks of NZ are becoming very expensive to uninsurable, and
| extreme impact weather events are getting more frequent.
|
| It would be fair say a good portion of the population don't
| understand the maths of a weather event just how astronomically
| expensive a sudden flood is.
|
| In our small town in the last 5 years, we've had 2-3 different "1
| in 100 year" floods within 30km of each other (highly localised
| dramatic flooding and slips). To the point "1 in 100 year" is now
| a standing joke.
| ViscountPenguin wrote:
| When did the council last revise your flood models? Up here in
| Queensland, it caused a real stir when the council released
| updated flood models and lots of "1/1000" year flood houses
| turned into "1/10"
| Havoc wrote:
| Not a big fan of "uninsurable". They'll happily insure high risk
| stuff, for an appropriate premium. It just becomes unaffordable
| to the average family.
|
| As a side note there is another insurance disaster in the making
| - shadow fleet carrying millions of barrels of oil in old ships
| with opaque ownership and even murkier maintenance history...they
| don't do the whole insurance thing. Only a matter of time before
| the world faces a very awkward "who's picking up the bill"
| discussion. Small one already happened in the Black sea.
| beej71 wrote:
| > They'll happily insure high risk stuff, for an appropriate
| premium.
|
| From what I've seen, this isn't always the case. My parents'
| insurer stopped offering fire coverage in their area with no
| option to buy at a higher price.
| DiggyJohnson wrote:
| Presumably they could try and find a different insurance firm
| or a boutique.
| xoa wrote:
| FWIW and depending on where you are this could be down to
| local regulations. A lot of (most?) polities do not allow
| insurance companies to simply set prices based on their
| assessment of risks and the market, but rather place
| extremely heavy restrictions on the process (which further
| inevitably get politicized). They may also have regulations
| around minimum numbers of people to offer coverage to in an
| area and endless other related issues. So an insurance
| company that does the math and thinks it has to raise
| premiums 200% or whatever to make it work, unless somebody
| meets specific XYZ criteria around fire resistance (which are
| expensive), it may find that it simply is not allowed to at
| all, or not without long delays and a burdensome legal/PR
| battles. They always have the right to leave though.
| xnx wrote:
| Risk feels like a pendulum that periodically needs to swing back
| to the individual property owners. We're probably entering a
| cycle where homes need to be built in less risky locations and
| built more durable to risk.
| xyzzy123 wrote:
| > On an inflation-adjusted basis, Zurich said that average
| insured losses rose by 5.9% per year between 1994 and 2023, while
| global gross domestic product (GDP) increased by 2.7% annually
| over the same period.
|
| This is a claim that insurance losses increased by 2.6x which TBH
| doesn't seem out of line for actually being flat, given premium
| growth outpaced GDP growth, more assets will be under insurance,
| and the monetary base exploded over those 20 years.
| andy99 wrote:
| First, insurance companies should be the last thing we consider
| when setting policy, this is propaganda for them trying to
| protect their racket, not anything more telling.
|
| Second, governments and private companies should be looking at
| (socializing) mitigations that will keep risk within tolerable
| levels (without caring whether some legacy insurer continues to
| be able to gouge cusotmers). If there's a clear and identifiable
| threat, we can build dikes or sea walls or spillways or whatever
| it is that can alleviate the issue. "Think of the insurance
| implications" is a silly distraction.
| milesskorpen wrote:
| At least in the US, insurers have been losing money in recent
| years. Definitely not price gouging. Insurance is an amazing
| service.
| andy99 wrote:
| > Insurance is an amazing service
|
| I've noticed it's done wonders for your healthcare system
| kibwen wrote:
| _> Second, governments and private companies should be looking
| at (socializing) mitigations that will keep risk within
| tolerable levels_
|
| The moral hazard is killer here. I fear that in practice what
| this means is that the rest of the US will end up bailing out
| the gormless Floridians who refuse to stop building McMansions
| on the coast. Insert the gif of Bugs Bunny cutting off Florida
| and letting it drift off into the Caribbean.
| whatwrongwyou wrote:
| This presumes that everyone who builds in coastal areas is
| "gormless" and deserves hardship. Millions of people live on
| islands and they don't get a choice where they build. Several
| Polynesian countries will disappear by the end of the decade.
| Are they "gormless"?
| hansvm wrote:
| Easy. Don't apply the policy to new homes.
| senthil_rajasek wrote:
| States like Florida in the U.S already have "state backed"
| insurers of last resort.
|
| Home insurance is definitely skyrocketing, I live in Minnesota
| and my premium tripled in 2024.
|
| https://en.m.wikipedia.org/wiki/Citizens_Property_Insurance_...
| charcircuit wrote:
| I'm confused that this article made no mention of laws preventing
| insurance companies from accurately pricing insurance.
|
| Otherwise they can increase the price to match the risk. Even if
| the risk is unpredictable they could increase the price until
| they were comfortable with the risk, or themselves get insurances
| to cover the risk of providing insurance.
| vjvjvjvjghv wrote:
| [delayed]
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