AAA pulls back from offering insurance in Florida, following Farmers
AAA pulls back from offering insurance in Florida, following Farmers
More insurance companies are fleeing the state because of the growing threat from natural disasters.
More insurance companies are fleeing the state because of the growing threat from natural disasters.
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Whoa now. That is some prejudiced and elitest reporting. How dare anyone acknowledge the problems in florida, the sunshine state that is perfect.
In all seriousness: It sounds like this is being a bit over reported, but the extent to which they are pulling out remains to be seen. And it is going to REALLY suck for florida as people are stuck holding mortgages for condemned and washed away houses.
But it also sets a really concerning precedent. California has already seen issues (but, being a functioning government, are setting up government programs to protect people from wildfires). But more and more of the country/world are going to become uninhabitable over the next few decades and insurance companies are likely to pull out of risky areas and just raise premiums elsewhere.
I’d say Arizona and Texas are at higher risk than California, unless earthquakes get way more frequent and bad.
Texas is always at a high risk of someone plugging their phone charger into the wrong outlet and taking out the grid for the entire state. They are a special kind of stupid
Arizona is interesting. They definitely have massive drought issues. But wildfire wise, they tend to be pretty okay. I assume because there isn't enough moisture to actually grow trees to burn but I am sure it is more complex than that.
Still, compare these
https://en.wikipedia.org/wiki/2022_Arizona_wildfires versus https://en.wikipedia.org/wiki/2022_California_wildfires
And, for fun, New Mexico: Like Arizona but with fewer people, worse roads, and a little bit more water. https://en.wikipedia.org/wiki/2022_New_Mexico_wildfires
Wildfires aren’t the issue with Arizona, extreme heat is.
Which isn't something insurance covers and thus not applicable here.
You can't (easily) file a claim because "it is hot as balls outside". You can (generally) file a claim for "my house burned down".
The planet becoming more and more inhospitable is one side of this hell. But the issue with insurance companies pulling out is that it leaves the owners holding the bag. The bag, in this case, being a massive mortgage on a condemned plot of land.
"Hot as balls" raises workers' comp. and health insurance payouts, people getting heat exhaustion and heat stroke, even heart and respiratory diseases can be brought on or worsened by heat.
The risk in CA is that they have built so many communities in areas that are prone to wild fires (and in some cases are even part of the natural eco system) that is inevitable that if they rebuild that it will burn down again. They also have high material costs, higher labor costs, and more stringent building codes (rebuilding to code can get really expensive). Lastly CA has a more highly regulated insurance market which protects consumers, but makes it less profitable for insurance companies. While IMO this is a good thing it has ripple effects on whether or not the private market wants to participate.
💀
What are you doing on the internet? You’re supposed to STOP, DROP & ROLL!!!
In all seriousness, I hope you are well and surviving.
florida as people are stuck holding mortgages for condemned and washed away houses.
I mean what is the issue with just not paying them? For a big enough hurricane there will be too many delinquent mortgages, so it might be easy to hide or just tell the bank that the free market is harsh mistress and sucks their risk didn't pay off.