Insurance companies won’t write new policies in certain areas, have you heard of this?

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81

I’m not sure what the options would be in California, but I’ll tell my friend to look into it.

82

We are located in what is deemed a flood zone and are required to hold separate flood insurance as long as we have a mortgage. Only voluntary if you are mortgage free.

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83

I’m not sure why earthquake coverage is different…

84

Flood insurance offered through FEMA. Not sure about earthquake insurance. But that might be the big difference.

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I don’t know, but if your house gets damaged in an earthquake, your lender is out their collateral just as they would be with a flood.

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86

I was curious, so I looked more detail about the highest risk regions. The highest overall risk counties in the table are as follows. LA had nearly double the risk value of #2 Harris.

  1. Los Angeles (CA): Overall Risk Index = 100, Earthquake = 100, Wildfire = 99.9, Heatwave = 98, Tornado = 98, Landslide = 96, Lightning = 95, Social Vulnerability = 86
  2. Harris (TX) – Hurricane = 100, Lightning = 100, Heat wave = 99, Cold wave = 99
  3. Riverside (CA)
  4. San Bernardino (CA)
  5. Almeda (CA)
  6. Santa Clara (CA)
  7. Miami (FL)
  8. Orange (CA)
  9. Broward (FL)
  10. Palm Beach (FL)
  11. San Diego (CA)

The lowest risk counties were:

  1. Loving (TX) – Population = 64 (lowest population county in US), Overall Risk Index = 0.03, Cold Wave = 29, Ice Storm = 25, Heat Wave = 19, Others <= 10
  2. Kalawao (HI)
  3. Keveenaw (MI)
  4. McPherson (NE)
  5. Brisol Bay (AK)
87

Can you point me to the table? I missed it.

88

In California, the state required insurance companies that offered house insurance to offer earthquake insurance. But then insurance companies stopped writing new house insurance policies in California because they did not want to write new earthquake insurance, due to the regionally concentrated potential losses. The state set up the California Earthquake Authority to offer earthquake insurance (which was sold through the house insurance companies), and house insurance companies became willing to write new house insurance policies (until now).

Obviously, floods are another type of regionally concentrated potential loss, which is likely the reason insurance for that is separated. Now we are seeing awareness of wildfires causing regionally concentrated potential loss, but it is harder to separate that from regular house insurance where fires (most of which affect one house at a time and are not regionally concentrated) are the traditional main component of what house insurance is supposed to cover. Hence that spooks insurance companies from having too much of their business in one region, particularly one they see as vulnerable to wildfires.

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89

I meant the downloadable tables at Data Resources | National Risk Index .

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90

We’re also in SoCal. In a yellow zone surrounded by mostly red. A strange thing if you think about it. In comparison to what you posted we have Wildfire=0 and Ravine Flooding=0. So, I assume that makes us a much lower risk.

We insured with Lemonade a couple of years back. Your friends may want to check them out if they haven’t tried. They’ve even been sending us small checks with no explanation as to why. The price seems OK. No idea how they are with claims though.

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91

My county’s risk index is 76.9, which is relatively low compared to the rest of the country. We are low or moderate on every measure except ice storms and lightning.

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Flood insurance is a national program run through FEMA, not regional. But the history of earthquake insurance in California interesting.

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And is supported/back-stopped by US Taxpayers. The program is about $20 billion in arrears.

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Her best bet might be to work with an agent who can shop multiple companies.

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95

I tried to get a quote from Lemonade since my home insurance is up for renewal next week. After entering my southern CA address, the website returned the following. If I enter an address in a different state, there is no such message. I was able to get quotes from other insurers, just not Lemonade.

Sorry, we’re unable to offer you a quote at this time

At the moment, our capacity for new business is limited. If you want, I can email you when things change.

I am currently using a smaller insurer that has only a 0.1% market share. It has home offices in LA and only serves CA and a few neighboring states in the southwest. I initially chose them years ago, primarily because their rates were well below competitors. I’ve switched back and forth between them and another insurer over the years, as rates have changed.

There are many smaller insurers like this, ,beyond the big ~5 companies that are most well known. A partial list is at Residential Insurance Contact List .

96

I worked for a high risk lender and we sold property insurance on some of our loans that were secured with personal property. When the Northridge earthquake hit, our borrowers were some of the only ones who had any insurance (they wouldn’t have had a lot through us, likely not more than $5000. We had some pretty happy customers.

We also sold credit life and a separate $5000 life insurance policy that you didn’t have to qualify for (same price for everyone). It covered AIDS, so we sold a lot of policies in San Francisco when those with AIDS or a high risk for getting aids couldn’t get insurance anywhere else.

All insurance is state run (except the national flood insurance program) and we had the same policies in SF as in LA as in Ojai as in any other place in California, so it was one big pool. If we paid more claims in SF, that allowed us to increase rates across the state (after filing new numbers). We really weren’t losing money

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97

I believe hurricane and homeowner’s are required for mortgage but m not sure about flood. We used to be just beyond the flood zone but after Fukushima tsunami, they redrew the boundaries and we are now just inside flood/tsunami zone. We paid off our mortgage over a decade ago, before H retired.

We are ok with paying premiums to sleep better at night with all the extreme weather incidents. Fortunately we can afford the premiums—so far and have not made any claims except one about 30 years ago for a burglary.

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98

And if something happens that only impacts a couple of their customers their ability to cover the claims is easily managed by them. If something happens that wipes out 20%+ of their customers I’d question their ability to cover the claims. I’m sure they re-insure through another carrier but that carrier would possibly be implicated in a mass loss as well.

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At our old house, we got a notice that we were in a flood zone and would need flood insurance. Thank goodness DH was trained in civil engineering as well as structural, because he looked at the contour maps and found that part of the road, but not our section, was in a flood zone. He wrote a letter with his PE stamp and they backed off. So check it out first if you ever get a letter like that. I felt bad for people who might be buying insurance who didn’t need it.

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100

Yes, that is true. Keep forgetting that. Wonder what will happen when people can’t get insurance? How will it work then?

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