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Is the world becoming uninsurable?

(charleshughsmith.substack.com)
478 points spking | 228 comments | | HN request time: 0.469s | source | bottom
1. bluedevil2k ◴[] No.42733208[source]
Like we see in California, when the government sets a price ceiling, insurance companies just leave. Same in Florida. If the free market truly was allowed run normally, the insurance rates in Pacific Palisades or on the Florida coast would be so high that no one could afford to live there. Is that a bad thing? If someone was living in a house near where they tested missiles, we'd call them crazy. At what point can we say the same about people building and rebuilding over and over in these disaster areas.
replies(20): >>42733219 #>>42733293 #>>42733338 #>>42733367 #>>42733486 #>>42733536 #>>42733984 #>>42734013 #>>42734047 #>>42734060 #>>42734202 #>>42734459 #>>42734714 #>>42734874 #>>42739590 #>>42740487 #>>42741749 #>>42742138 #>>42743881 #>>42744799 #
2. tptacek ◴[] No.42733219[source]
Or some forms of housing in high-risk areas, like sprawling single-family houses, might get too expensive, and the only way for people to live in those places would be a smaller number of denser, more easily defended structures. Also a good thing.
3. underwater ◴[] No.42733293[source]
Price caps always seem like such a transparent political move.
replies(1): >>42733332 #
4. mgiampapa ◴[] No.42733332[source]
How about profit caps? 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.

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.

replies(9): >>42733343 #>>42733377 #>>42733396 #>>42733458 #>>42733468 #>>42733898 #>>42733997 #>>42734006 #>>42734550 #
5. Dig1t ◴[] No.42733338[source]
There should be a way to build fire resistant buildings to reduce the cost of insuring them, likely this would be the solution in California without price caps.

You can build out of concrete and use fire resistant materials like metal or tile for the roof and your house is nearly fireproof. These buildings would be realistically insurable in both California or Florida. They would cost more to build, not THAT much more though especially if land costs many millions, an extra 50k - 100k to build out of concrete is a very reasonable expense.

replies(5): >>42733371 #>>42733453 #>>42733677 #>>42734267 #>>42734815 #
6. ladberg ◴[] No.42733343{3}[source]
Insurance companies have pretty thing profit margins regardless, even in areas where profits are not capped. It's a competitive marketplace!
replies(1): >>42733354 #
7. tomrod ◴[] No.42733354{4}[source]
I'm not sure I believe your factoid. Can you cite? UHC is one of the wealthiest companies in the world.
replies(2): >>42733390 #>>42733598 #
8. zeroonetwothree ◴[] No.42733367[source]
Clearly it’s not true that “no one” could afford to live there. And if demand was low then the housing would become more affordable
replies(1): >>42733482 #
9. defrost ◴[] No.42733371[source]
Steel frame, flame retardant insulation and cladding, rammed earth, .. these are all options.

Flammable trees well away from a leaf free clean guttered (or no gutter) house are also no compromise requirements.

See: https://research.csiro.au/bushfire/ and https://www.csiro.au/en/work-with-us/services/testing-and-ce...

for the rabbit hole of Australian Bushfire housing certification and testing.

Burning Down the House: Trial by Fire CSIRO- https://www.youtube.com/watch?v=KBtawn7IAnI

replies(3): >>42733567 #>>42733595 #>>42733666 #
10. bitcurious ◴[] No.42733377{3}[source]
> 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?

replies(2): >>42733448 #>>42734403 #
11. amazingamazing ◴[] No.42733390{5}[source]
their september 2024 earnings put them at 6% margin. that’s not very good. for reference apple is 15%, mcdonalds is 32% and costco is about 3%. that being said compared to a competitor, elevance at 2.5%, they’re doing well. a little worse than allstate (car and home insurance), which is about 7%.
replies(1): >>42733675 #
12. cowsandmilk ◴[] No.42733396{3}[source]
> 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.

replies(1): >>42734670 #
13. nradov ◴[] No.42733448{4}[source]
That is so, to an extent. But it's balanced against employer demands to hold down medical costs because they pay most of the bills. If your HR department can save 5% on employee medical costs by switching from Blue Cross to Cigna next year they'll absolutely do it.
14. michpoch ◴[] No.42733453[source]
> You can build out of concrete and use fire resistant materials like metal or tile for the roof and your house is nearly fireproof

Just like exactly the rest of the world? We, the non-USA folks, are looking yearly at either fires or hurricanes destroying these wooden houses there and people keep rebuilding them. Insanity.

replies(4): >>42733498 #>>42733689 #>>42734414 #>>42737585 #
15. csomar ◴[] No.42733458{3}[source]
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.

replies(3): >>42733502 #>>42734404 #>>42734645 #
16. toast0 ◴[] No.42733468{3}[source]
Most regulated insurance markets do have profit caps. California certainly does, but there was still a price cap added.
17. sadeshmukh ◴[] No.42733482[source]
No one can truly afford to live there, if you price in the cost of insurance. The only reason people live there is because they haven't hit the 1/100 chance yet.
replies(2): >>42734131 #>>42740795 #
18. epistasis ◴[] No.42733486[source]
I've been trying to talk to people locally, a place with lots of homes built in the woodland-urban interface, about the risks of climate change and how insurance will have to change. Unfortunately these discussions almost never go well, because it seems that most people have at best a surface level understanding of what insurance is and how it works, and everyone is convinced that it's a full scam and insurance companies are fabricating everything. When in reality, insurance is one of the rare areas where risks are very well assessed, not just by the initial insurer but also by a second party when reinsurance is purchased. And often those exits from the insurance markers are due to inability to purchase reinsurance.

Of course, explaining anything in detail is likely to make people think you work in the industry (I do not) and get accused of being a shill. All of which proves to me that older generations had a much easier life because nobody so financially ignorant today is in any sort of position to be able to buy a home.

All that said, I don't think it's actually a price ceiling. It's a limitation of what factors can be taken into account to set rates, and constitutional amendment from Prop 108 prevents the legislature from changing it.

replies(6): >>42733549 #>>42734452 #>>42734486 #>>42734774 #>>42735260 #>>42742768 #
19. Enginerrrd ◴[] No.42733498{3}[source]
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.
20. macinjosh ◴[] No.42733502{4}[source]
People choose to smoke, overeat, engage in risky activities that can cause injury near and long term (Rock climbing, riding motorcycles, football, MMA). Why should society pay for these choices?
replies(4): >>42733626 #>>42734151 #>>42734411 #>>42734835 #
21. jmclnx ◴[] No.42733536[source]
>Like we see in California, when the government sets a price ceiling, insurance companies just leave

Does not answer the question. With no price caps, no one will be able to buy insurance even if required by law. So that means if you own a house in a risky area, you will be unable to sell it and your values will fall. The price caps are to prevent that. But to me, there should be big incentives to prevent building and re-building in risky areas.

So yes, the world in some areas are uninsurable. And other areas are becoming uninsurable.

replies(4): >>42734393 #>>42734781 #>>42738537 #>>42739326 #
22. Aurornis ◴[] No.42733549[source]
> Unfortunately these discussions almost never go well, because it seems that most people have at best a surface level understanding of what insurance is and how it works, and everyone is convinced that it's a full scam and insurance companies are fabricating everything

I have the exact same experience when discussing anything insurance related: People have wild assumptions about how much profit insurance companies are making.

When I ask people how much cheaper they think their insurance (health, home, etc) would be if we forced insurance company profits to zero they usually have some extreme guess like 50%. 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. The discourse is so cooked that everyone who just assumes insurers are making unbelievable profits without ever checking.

Like you said, when I try to bring numbers into the discussion I get accused of being a shill (or a “bootlicker” if the other person is young).

The environment this creates has opened the door for some really bad politics to intervene in ways that aren’t helpful. I wouldn’t be surprised if the eventual outcome in a lot of these places is that politicians pass legislation putting the local government on the hook for insurance after they squeeze regular insurers so hard they have to back out to avoid losing money in those markets. The consequences won’t manifest for several years, potentially after the politicians have left office, but could be financially burdensome. Similar to how many local governments were very generous with pension plans because politicians knew the consequences would only be felt by their successors.

replies(9): >>42733578 #>>42733608 #>>42734172 #>>42734218 #>>42734299 #>>42734765 #>>42734992 #>>42736524 #>>42744063 #
23. Dig1t ◴[] No.42733567{3}[source]
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.
24. throw0101a ◴[] No.42733578{3}[source]
> 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-...

replies(1): >>42734648 #
25. sdiupIGPWEfh ◴[] No.42733595{3}[source]
> flame retardant insulation

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

replies(1): >>42733646 #
26. ladberg ◴[] No.42733598{5}[source]
Health insurance does have profit caps, so like the sibling commenter said their margins are small (6%) but also decently under the cap (20%) in the first place.
replies(1): >>42733682 #
27. wuiheerfoj ◴[] No.42733608{3}[source]
>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

replies(6): >>42733699 #>>42734030 #>>42734097 #>>42734100 #>>42734142 #>>42734570 #
28. throw0101a ◴[] No.42733626{5}[source]
> Why should society pay for these choices?

Because it's the only way to get universal coverage, which if you don't have, means a portion of the population gets really sick, jams the ER, can't afford to pay the resulting bill (maybe declaring bankrupcy), and someone then has to eat/cover the cost. Often by hiking prices for those that do have coverage.

Do a search for "ACA three legged stool":

> It starts by requiring that insurers offer the same plans, at the same prices, to everyone, regardless of medical history. This deals with the problem of pre-existing conditions. On its own, however, this would lead to a “death spiral”: healthy people would wait until they got sick to sign up, so those who did sign up would be relatively unhealthy, driving up premiums, which would in turn drive out more healthy people, and so on.

> So insurance regulation has to be accompanied by the individual mandate, a requirement that people sign up for insurance, even if they’re currently healthy. And the insurance must meet minimum standards: Buying a cheap policy that barely covers anything is functionally the same as not buying insurance at all.

> But what if people can’t afford insurance? The third leg of the stool is subsidies that limit the cost for those with lower incomes. For those with the lowest incomes, the subsidy is 100 percent, and takes the form of an expansion of Medicaid.

* https://archive.is/https://www.nytimes.com/2017/07/10/opinio...

This 'architecture' was developed by Jonathan Gruber:

* https://cdn.americanprogress.org/wp-content/uploads/issues/2...

* https://en.wikipedia.org/wiki/Jonathan_Gruber_(economist)

It is a form of social safety net.

replies(1): >>42734295 #
29. defrost ◴[] No.42733646{4}[source]
Elsewhere fiberglass and mineral wool insulation aren't regarded as carcinogens.

https://pubmed.ncbi.nlm.nih.gov/1947241/

https://mesothelioma.net/fiberglass-connection-to-mesothelio...

replies(1): >>42735195 #
30. throw0101a ◴[] No.42733666{3}[source]
> 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...

31. tomrod ◴[] No.42733675{6}[source]
To be fair, they play a shell game by steering people towards their subsidiary owned medical providers (avoiding loss ratio limits of 15% to 20% by putting the money into providers, which have no profit cap).[0]

[0] https://pnhp.org/news/insurers-avoid-loss-ratio-limits-by-sh...

replies(2): >>42734077 #>>42734103 #
32. throw0101a ◴[] No.42733677[source]
> There should be a way to build fire resistant buildings to reduce the cost of insuring them

There is:

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

But when a lot of your housing stock is multiple decades old that was built before modern building codes, there's a lot of kindling out there.

33. tomrod ◴[] No.42733682{6}[source]
The insurance subsidiary will have a cap, but provider subsidiaries have no such cap.[0]

[0] https://pnhp.org/news/insurers-avoid-loss-ratio-limits-by-sh...

34. throw0101a ◴[] No.42733689{3}[source]
> 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.

replies(1): >>42739136 #
35. nradov ◴[] No.42733699{4}[source]
You can literally read the 10-K statement from any of several publicly traded medical insurance companies. Average industry profit margin is about 3%. There are also some non-profit insurers but their fees generally aren't any lower.
36. waterhouse ◴[] No.42733898{3}[source]
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.
37. JKCalhoun ◴[] No.42733984[source]
> when the government sets a price ceiling, insurance companies just leave…

> the insurance rates in Pacific Palisades or on the Florida coast would be so high that no one could afford to live there…

Seems like the result is the same — people will live there but without insurance.

replies(2): >>42733995 #>>42745912 #
38. orange_joe ◴[] No.42733995[source]
worse, you’ll be paying to bail them out in the name of solidarity.
replies(1): >>42734108 #
39. JumpCrisscross ◴[] No.42733997{3}[source]
> 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.

replies(1): >>42734058 #
40. JKCalhoun ◴[] No.42734006{3}[source]
Or maybe C-suite pay/benefits caps, ha ha.
replies(1): >>42738175 #
41. hnburnsy ◴[] No.42734013[source]
Not just the rates are managed, but also deductibles. I'd gladly have a 5 figure deductble to keep my or miums lower, but regulators think this is unfair to some.
replies(2): >>42734083 #>>42734098 #
42. jwagenet ◴[] No.42734030{4}[source]
The issue in the US is that there is no price regulation for different procedures (other than Medicare), plus the providers (hospital chains) are intertwined* with insurance. The end result is everyone charges as much as they can and the premiums need to be high, even if insurance technically negotiates the rates down from the “sticker” price. Insurance companies are willing to take a small percent of profit because there is so much money being taken from customers.

* https://www.statnews.com/2024/11/25/unitedhealth-higher-paym...

replies(1): >>42734234 #
43. lmm ◴[] No.42734047[source]
Don't worry, the California government is responding to that by making it illegal to stop offering insurance in the state. That will definitely fix the problem.
replies(3): >>42734111 #>>42734662 #>>42736044 #
44. Spivak ◴[] No.42734058{4}[source]
I think that's a great metaphor for the situation, when you get a patient running a 105 fever you put them in an ice bath and then consider what underlying problem is ailing them.

You do the first part so they don't die before the long-term treatment kicks in.

replies(1): >>42734134 #
45. EGreg ◴[] No.42734060[source]
Can’t you say that about any part of LA? Once a fire gets going, it grows and can destroy any neighborhood.

Call me crazy but if I was the mayor of LA I’d make them invest heavily in PREVENTION. Cameras and drones all over the place in the forests, to nip fires in the bud (and carch arsonists). I would also make sure that the live video footage would be used only for that purpose. It would use AI at the edge to flag every fire immediately and alert nearest authorities, and otherwise delete footage. There may be other AI at the edge uses added later by the regulators but I’d work to put in place heavy bars to overcome (eg 70% in a public referendum) before they are added.

I would also invest heavily in mobile firefighting tools and materials. The firefighters using buckets is pitiful.

But then again, LA hasn’t invested in itself for decades. It’s like the opposite of NYC: rich people don’t want to live in Downtown LA, they live in the equivalent of our Brooklyn, say Manhattan Beach and Sheepshead Bay by the beach.

Because half of downtown looks increasingly more like skid row. Signage and streets are something out of the 70s literally. And there pretty much hasn’t been any new skyscrapers built since the 80s. The skyline is stuck in the Arnold Schwarzenegger movie era.

I stayed in Freehand hostel which is actually pretty nice, even though there’s abandoned buildings and homeless all around. I met a drunk Andy Dick there by the pool one evening LOL.

And you people from San Francisco — it ain’t much better over where you are. I visited Twitter HQ right when Elon took over. And let me tell you — there is a curious juxtaposition of City Hall, City Opera, The SF Philharmonic, and the fourth corner of that illustrious intersection is… a large abandoned alleyway with dumpsters. What? Imagine Lincoln Center in NYC having that.

On my show I did a lot of interviews — with regulators, technologists, sociopolitical commentators like Noam Chomsky. But one of my most down-to earth interviews was in SF of a homeless guy w his dog. See it for yourself what I’m talking about:

https://www.youtube.com/watch?v=rqjFeaDLuYQ

PS: to the silent downvoters… normally I don’t mind but this time you’re just doing it out of spite. Watch the video or say something. I bet you live there and don’t want to have these things pointed out. SF and LA were so great… so many movements started there. Lately people are fleeing and the homelessness is out of control.

replies(2): >>42734231 #>>42734431 #
46. anomaly_ ◴[] No.42734077{7}[source]
Yea, and after all that they still only eked out a 4% net profit after tax for 2024.
47. ◴[] No.42734083[source]
48. lotsofpulp ◴[] No.42734097{4}[source]
These are all the publicly listed health insurers in the US, with public financials, so the numbers come from the 10-Q and 10-K reports filed with the SEC.

Note that the first one, United Health, has slightly higher profit margins than the rest because UNH has an enormous business selling healthcare itself, not just insurance (they own a lot of doctor groups and outpatient clinics and employ a lot of doctors and nurses).

https://www.macrotrends.net/stocks/charts/UNH/unitedhealth-g...

https://www.macrotrends.net/stocks/charts/ELV/elevance-healt...

https://www.macrotrends.net/stocks/charts/CI/cigna-group/pro...

https://www.macrotrends.net/stocks/charts/CVS/cvs-health/pro...

https://www.macrotrends.net/stocks/charts/HUM/humana/profit-...

https://www.macrotrends.net/stocks/charts/CNC/centene/profit...

https://www.macrotrends.net/stocks/charts/MOH/molina-healthc...

The other big insurers will be Kaiser Foundation Health Plan and various plans franchised with Blue Cross Blue Shield, but they are all non profit.

https://projects.propublica.org/nonprofits/organizations/941...

replies(1): >>42734303 #
49. forgetfreeman ◴[] No.42734098[source]
Given over half of all households in the country have less than $20k in savings I'd say concerns over equality of access may be well founded. Edit: No? The poors can go fuck themselves? Alright then I guess.
replies(1): >>42734771 #
50. jfengel ◴[] No.42734100{4}[source]
Part of the problem is that the existence of the middle man adds a lot of costs: insurance company salaries, their executives, doctor's office billing coding, advertising, etc.

The shareholders take home only a fraction. But a lot of money gets spent that simply doesn't need to be. Other countries avoid the deadweight loss of the middle man.

replies(2): >>42734150 #>>42734292 #
51. tfehring ◴[] No.42734103{7}[source]
The 6.0% margin (for UnitedHealthGroup as a whole) already includes that. UnitedHealthcare (the subsidiary health insurer) had a slightly lower operating margin of 5.6% in Q3. https://www.unitedhealthgroup.com/content/dam/UHG/PDF/invest...
52. urhmbutwait ◴[] No.42734108{3}[source]
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.

replies(2): >>42734361 #>>42734625 #
53. owlbite ◴[] No.42734111[source]
Source? Many companies seem to be stopping offering insurance in the state just fine!

The most recent moves seem to be relaxing the pricing rules to allow major disaster pricing and recharging reinsurance rates in exchange for insurers offering more policies in high risk areas.

replies(1): >>42734215 #
54. oefrha ◴[] No.42734131{3}[source]
There are plenty of very rich people living there who can afford the house burning down every single year. So false.
replies(1): >>42734415 #
55. JumpCrisscross ◴[] No.42734134{5}[source]
Correct. Caps are fine as a short-term measure.

In the long term, they’re putting a patient running a fever on immunosuppressants. The fever will go. But the patient will die.

56. bruce511 ◴[] No.42734142{4}[source]
Insurance fees are not high because the insurance companies are making huge profits.

They're high because providers are making huge profits.

Now granted, they may ultimately be the same thing, but that's a different discussion [1]

In the context of housing (fires, hurricanes etc) insurance is expensive because housing is expensive to build.

[1] insurance companies have to invest their income somewhere. It makes sense to choose companies will high returns. Which includes some health care providers. Which can basically change whatever they like because of structural reasons that have been well discussed.

replies(1): >>42734286 #
57. lotsofpulp ◴[] No.42734150{5}[source]
The genius of the US way is that the politicians avoid the heat when healthcare coverage is denied. Whereas UK and Canadian politicians have to answer to their constituents.

Of course, now that getting murdered is on the table, the US health insurance executives might want to up their compensation.

replies(2): >>42734372 #>>42737850 #
58. Sabinus ◴[] No.42734151{5}[source]
After a society brings in universal healthcare coverage, more rules discouraging smoking, overeating, and engaging in risky activities often follow. Which is either a nice way to get the people of the country caring about each other's health, or an awful government overreach depending on your political bent.
59. harimau777 ◴[] No.42734172{3}[source]
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.
replies(2): >>42734210 #>>42734227 #
60. nullc ◴[] No.42734202[source]
> the insurance rates in Pacific Palisades or on the Florida coast would be so high that no one could afford to live there

I'm not so sure. The Pacific Palisades have astronomical real estate prices. (actually costly property in Florida isn't cheap either). I think the insurance costs would come out of the property prices.

I say this on the basis that the prices the real estate sells for is already what the market will tolerate, if there are other costs to owning it-- then the remaining part the market will tolerate will be less.

Perhaps a result of this is that it may only be realistic to construct lower costs 'disposable' cabins in areas with higher disaster risk... if so, that wouldn't sound like an unreasonable way to allocate resources.

61. MattGaiser ◴[] No.42734210{4}[source]
Executive pay is such a tiny fraction that eliminating it would be lost in period to period fluctuations.
62. nathanaldensr ◴[] No.42734215{3}[source]
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.”

replies(1): >>42734351 #
63. hattmall ◴[] No.42734218{3}[source]
Health Insurance IS a huge racket. Insurance profits are only a small slice. Executive compensation isn't part of profits. The profits of the required sole source medical supplies company isn't part of insurance profits. The contracts, salaries, benefit packages, overpayments, and waste of healthcare systems and pharmaceutical companies aren't reflected in insurance profits. Just looking at the raw profit percentages returned to shareholders is absolutely meaningless.

You have to look at the entire healthcare picture and realize that insurance is the system driving the exorbitant costs. There is no legitimate reason for healthcare prices to be so insane.

replies(2): >>42734417 #>>42737930 #
64. lotsofpulp ◴[] No.42734227{4}[source]
All employee compensation, including CEO and board of directors, is included in the expenses used to calculate profit margin.

Profit margin is all revenue minus all expenses.

replies(1): >>42735221 #
65. Atotalnoob ◴[] No.42734231[source]
Alleyways are good. They help prevent trash and smell from being on the streets people use.

NYC doesn’t have them and the city smells terrible from all of the garbage

replies(1): >>42734259 #
66. pizza ◴[] No.42734234{5}[source]
Right, low profit margins are not a valid argument for why it’s invalid for consumers to suspect there is some inefficiency compared to other markets. Saying the system must be efficient because profits are low is like saying boiling water should be as cheap as 98->99 degrees C because it’s just +1 C - profit margins aren’t as good an indicator of whether there is an unusual amount of disorder in the system, compared to extremely context-sensitive resource costs for hypothetically identical systems.
replies(1): >>42735759 #
67. EGreg ◴[] No.42734259{3}[source]
OK it’s not just an alleyway but an entire half of a city block trash heap with dumpsters make one think that they neglected to build anything nice in that fourth corner. Oh and two streets away are tribes of homeless people. Watch the first 5 seconds of my video.

In fact my video literally shows trash on the street as well in SF, as well as homeless.

Seriously, other cities have city hall. There are no dumpsters around it. We have courthouses and government buildings.

Certainly none around Lincoln Center which has the Metropolitan Opera and NYC Ballet and Philharmonic. It doesn’t smell there. There are beautiful fountains etc.

I took some photos of the homeless in SF juxtaposed in front of the skyline in the background. It is very pervasive there. LA and SF seem to be magnets for homeless.

If I was mayor I’d give them all a $50 phone preloaded with gigs including ones from the city, like sweeping the streets and from businesses such as handing out flyers. Have the app unlock mini storage and showers, and help them have digital ID. This ain’t rocket science. Crowdfund the support for each homeless the way we support kids in Haiti. Give them opportunities. But instead the bureaucracy just kicks them around and denies them opportunities without an address.

Anyway…

replies(1): >>42734545 #
68. pkaye ◴[] No.42734267[source]
I've been collecting a bunch of links on what things a homeowner can do. Probably the simplest thing is the clear a 5 foot ember resistant zone around the home. So remove greenery and replace wood chips with stone for example. Use fire resistant vents so ember does enter attic or crawlspace. Use Class A fire rated roof (which you can also get for asphalt shingles). If you have wood siding, replace with fiber cement siding...

https://www.insurance.ca.gov/01-consumers/200-wrr/Safer-from...

https://readyforwildfire.org/wp-content/uploads/2024/05/Low-...

https://osfm.fire.ca.gov/what-we-do/fire-engineering-and-inv...

69. Newlaptop ◴[] No.42734286{5}[source]
> Insurance fees are not high because the insurance companies are making huge profits.

United Healthcare alone made $23,000,000,000 in profit in 2023. Health insurance companies have collectively made $371 billion in profits since the passage of the Affordable Care Act.

Property & Liability insurance (home, car, etc) have relatively modest profit margins, but health insurance companies absolutely are making huge profits.

replies(4): >>42734428 #>>42734656 #>>42735237 #>>42737666 #
70. fsckboy ◴[] No.42734292{5}[source]
>Part of the problem is that the existence of the middle man adds a lot of costs: insurance company salaries, their executives, doctor's office billing coding, advertising, etc.

that's not a sophisticated analysis. it would be like saying mcdonalds is unecessarily expensive because executive pay, and cars, and dry cleaning, etc. etc. yet, if you tried to found a competitor, you'd have all those same expenses. even charities have to pay management.

insurance companies make money because their aggregate risk is less than your individual risk, and you really don't want your individual risk so you are willing to pay them extra, a premium, to get them to shore up your downside. After that it's like any other company selling any other thing.

71. mgh95 ◴[] No.42734295{6}[source]
> Because it's the only way to get universal coverage, which if you don't have, means a portion of the population gets really sick, jams the ER, can't afford to pay the resulting bill (maybe declaring bankrupcy), and someone then has to eat/cover the cost. Often by hiking prices for those that do have coverage.

The alternative that is always there is to repeal EMTALA.

> It starts by requiring that insurers offer the same plans, at the same prices, to everyone, regardless of medical history. This deals with the problem of pre-existing conditions. On its own, however, this would lead to a “death spiral”: healthy people would wait until they got sick to sign up, so those who did sign up would be relatively unhealthy, driving up premiums, which would in turn drive out more healthy people, and so on.

This misses the problem: [the ACA causes a moral hazard for lower classes likely to use it.](https://pmc.ncbi.nlm.nih.gov/articles/PMC8567089/)

The issue is a policy designed for a highly uniform, high social class, high status state (Massachusetts) was applied to the USA as a whole.

replies(1): >>42734416 #
72. novok ◴[] No.42734299{3}[source]
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.

replies(1): >>42734649 #
73. nradov ◴[] No.42734303{5}[source]
Some Blue Cross Blue Shield Association members are for-profit corporations now.

As for UnitedHealth Group, much of their profit comes from a large software business which is separate from their insurance, care delivery, and PBM businesses. If that software business was spun out it would be one of the 20 largest US tech companies.

replies(1): >>42734378 #
74. BeetleB ◴[] No.42734351{4}[source]
I imagine this won't apply if the insurer just leaves the state.
replies(1): >>42734392 #
75. typewithrhythm ◴[] No.42734361{4}[source]
People choose where they live, and should bear the cost relative to the amount of risk they chose to take. Government funding is not a magical blanket that somehow makes it moral to take from someone who made good decisions and give to another who made poor ones.
replies(3): >>42734742 #>>42737995 #>>42739773 #
76. gunian ◴[] No.42734372{6}[source]
no offence but that murder had nothing to do with what is right or caring for the people just a game same reason trains got graffiti on them. At most a beautiful lesson in the power that comes with controlling the narrative
77. lotsofpulp ◴[] No.42734378{6}[source]
> Some Blue Cross Blue Shield Association members are for-profit corporations now.

In this list, I couldn’t find a single for profit BCBS licensee other than Elevance. They all seem to be mutuals/member owned/non profit.

https://en.wikipedia.org/wiki/Blue_Cross_Blue_Shield_Associa...

> As for UnitedHealth Group, much of their profit comes from a large software business which is separate from their insurance, care delivery, and PBM businesses. If that software business was spun out it would be one of the 20 largest US tech companies.

Interesting, I didn’t know UNH sold software!

replies(1): >>42735064 #
78. PaulDavisThe1st ◴[] No.42734392{5}[source]
Yep. These are terms to operate as an insurance company in the state. If you don't want to do that, the rules have no bearing on you.
replies(1): >>42741138 #
79. gunian ◴[] No.42734393[source]
Tangential but I have read about propaganda and social engineering but seeing human caused fires to control migration patterns is a level of diabolical I never thought I would live to see but can't blame them if the cheap rent and house prices don't do the job gotta do what you gotta do
80. gunian ◴[] No.42734403{4}[source]
Any idea why Obamacare didn't follow the European model? Other than the freedom argument

People on HN always talk about European health insurance seems like an easier route than to murder people lol

replies(1): >>42734633 #
81. PaulDavisThe1st ◴[] No.42734404{4}[source]
> Because the response of a failure in governance is more government?

Are you this incredulous when the response to a failure in "the market" is more "market" ? Or when companies fail, and the response is "more companies", do you question that in the same way?

I'm not taking a position on the meat of your point, but this particular angle strikes me as very strange.

82. csomar ◴[] No.42734411{5}[source]
> People choose to smoke

Cigarettes can be taxed with proceeds going to care with those with lung cancer. Dangerous activities can have a separate insurance. For a popular sport, it means most people are engaging in this activity. Houses on the top of a mountain are for a very tiny minority (and a very rich one too). They should finance their lifestyles themselves.

83. rafram ◴[] No.42734414{3}[source]
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.
84. sadeshmukh ◴[] No.42734415{4}[source]
Afford doesn't mean you can technically throw money out the window. At some point, you are going to give up if the risk is high enough to have >2 events in your lifetime - time is also a cost to factor in, as well as loss of possessions. It's not quite that simple.
85. PaulDavisThe1st ◴[] No.42734416{7}[source]
> The alternative that is always there is to repeal EMTALA.

I suspect you think it's not great having homeless people on the street.

Wait till you see what it looks like when they actually start dying in the street because emergency health care is no longer available to them, nor to many of their housed neighbors, family and friends.

replies(1): >>42734576 #
86. chii ◴[] No.42734417{4}[source]
> There is no legitimate reason for healthcare prices to be so insane.

these profit margins are why some people claim that the US is actually subsidizing the rest of the world's low cost health outcomes.

These companies make money in the US, at high margins, which enables them to operate at low margins in other more regulated countries.

replies(1): >>42734614 #
87. chii ◴[] No.42734428{6}[source]
> alone made $23,000,000,000 in profit in 2023

why is this number considered huge? What measure are you using? These absolute numbers are meaningless, because you have to put it into context. That's why profit margin is what analysts use, not the absolute number.

If i changed those figures to: they made $77 per person, per year in the USA for providing healthcare services, does that still seem as big? Or is it now reasonable?

replies(1): >>42734501 #
88. rafram ◴[] No.42734431[source]
> Call me crazy but if I was the mayor of LA I’d make them invest heavily in PREVENTION. Cameras and drones all over the place in the forests, to nip fires in the bud (and carch arsonists).

This is a terrible way to deal with fire. The issue isn’t preventing fires from starting at all, because small fires are all over the place. A dropped cigarette can light a city block on fire if the wind is just right. The issue is preventing spread, and taking precautions when conditions (like wind) are conducive to rapid spread.

replies(1): >>42734595 #
89. donavanm ◴[] No.42734452[source]
> I've been trying to talk to people locally, a place with lots of homes built in the woodland-urban interface, about the risks

Its not just the insurance costs either. My neighbor is an architect who now does planning/consultation with the RFS (rural fire service, australia). Its basically de rigueur for people to try and avoid or evade fire sensitive planning controls. Just the most basic concepts like defensible space, eve guards, or nonflammable finishes, let alone adequate on site water storage or site access. People are intentionally building in bushland because they want to be “in trees”, unless they block the view of course.

Even if they understand the concepts and remember black saturday, or a few years back!, it doesnt apply to them. Theres no concept of personal risk & consequences, and theyre right. They will probably get bailed out by volunteers and socialized losses. Just like new developments along riverine flood ways.

90. Tadpole9181 ◴[] No.42734459[source]
> Is that a bad thing?

Is it a bad thing that we should consider most of the planet unlivable because disasters happen that aren't eternally and increasingly profitable to insure?

Is it a bad thing that literally tens of millions of Americans would no longer have insurance? That you're asking double digit percents of the entire population to leave cities and just... what? Suddenly have new homes in a region with plentiful resources and access to water and food and an economy and no disaster potential?

Is it a bad thing to compare entire states to missile testing grounds?

Is this satire?

replies(1): >>42734695 #
91. rewgs ◴[] No.42734486[source]
Insurance should not be for profit, and things like e.g. State Farm suddenly cancelling people's renters/fire insurance just two weeks before the fires (I am one of those people) are what people hate about insurance. No one is arguing that insurance is bad at risk assessment, but rather how they wield their proficiency with it.
replies(6): >>42734599 #>>42734844 #>>42735042 #>>42742291 #>>42742435 #>>42745848 #
92. slaw ◴[] No.42734501{7}[source]
$23,000,000,000 profit/29 million insured makes $793 profit per insured person.
replies(1): >>42736788 #
93. Atotalnoob ◴[] No.42734545{4}[source]
There are 8k homeless in SF and 350k homeless in NYC. I was surprised at the huge difference!

Larger buildings like a city hall or Lincoln center will have better waste management than a bodega or small shop. The larger places will have a loading dock and probably a compactor. Source: I worked at a waste tech company

https://en.m.wikipedia.org/wiki/Homelessness_in_New_York

https://www.sf.gov/data/homeless-population

94. donavanm ◴[] No.42734550{3}[source]
> 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.

replies(1): >>42734618 #
95. umanwizard ◴[] No.42734570{4}[source]
That’s because healthcare is unusually expensive in the US, not because insurers’ profit margins are unusually high.
96. mgh95 ◴[] No.42734576{8}[source]
I don't see what EMTALA has to deal with homelessness in this context. It largely comes down to uninsured, even post-ACA. If we can't afford the current system, it's not a matter of if, but when, either hospitals or providers leave medicare. To put it in perspective, the AMA reports (https://www.ama-assn.org/practice-management/medicare-medica...) that physician medicare compensation has declined 29% since 2001. At a certain point, it will simply be financially unsustainable. Whataboutism to distract from the fact that medicare alone is 3.7% of gdp and is forecast to grow to 5.1% by 2033 (https://www.cato.org/blog/fast-facts-about-medicare-social-s...) doesn't fix anything.

And FWIW, US Medicare spending alone is shaping up to grow to almost as much as some EU nations on a % of GDP basis (https://ec.europa.eu/eurostat/statistics-explained/index.php...).). Medicare isn't the solution. It's the problem.

replies(2): >>42735139 #>>42738042 #
97. EGreg ◴[] No.42734595{3}[source]
And those precautions are… putting out the fire before it spreads, right?
replies(2): >>42734702 #>>42737582 #
98. umanwizard ◴[] No.42734599{3}[source]
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.

replies(2): >>42734823 #>>42736037 #
99. tsimionescu ◴[] No.42734614{5}[source]
This might apply to Pharma, which actually operates in international markets, but not to US health insurers, PBMs, or for-profit Healthcare providers.
100. mgiampapa ◴[] No.42734618{4}[source]
In all of those examples you have the for profit private insurance leaving the market because it's not profitable enough. When you take away excessive profits and allow the governmental pool to compete with for profit insurance, risk is leveled across the pool and consumers pay less. If the big private insurance companies can't be more efficient or have better risk models than the government, well they should stop trying to sell policies.
replies(1): >>42734795 #
101. _factor ◴[] No.42734625{4}[source]
I’m building my next house right on an active volcano. Thank you for subsidizing my idiocy. You should see the view!
102. umanwizard ◴[] No.42734633{5}[source]
First of all there isn’t one “European model”, every country in Europe has its own system.

To answer the substantive point, it’s extremely difficult to pass substantial laws in the US due to the structure of its political system. The mandatory coalition of the president + 60% of the senate + 50% of the House of Representatives is a much higher bar than any other democracy. So laws aren’t written to be optimal policy, they are written to satisfy this extremely high coalition requirement — Obamacare in particular was very fundamentally weakened from some of the more expansive initial proposals to address the concerns of one or two senators and get them on board.

replies(1): >>42734776 #
103. mgiampapa ◴[] No.42734645{4}[source]
I'm not saying everyone pays the same, I'm saying you take away the for excessive profit nature of insurance. If you live in a tinderbox you are going to have more risk and more costs. Yeah somebody has to model the risk and set a price, but I'm saying it shouldn't be someone who has an incentive to make as much profit as possible.
replies(1): >>42734817 #
104. rcpt ◴[] No.42734648{4}[source]
Definition of "healthcare provider" really confuses me. Why is my nurse lumped together with people researching drugs? Is the CEO of the hospital a "provider"?
105. distortionfield ◴[] No.42734649{4}[source]
This is spot on. It’s not that I think health insurance companies are making insane profit margins. It’s that their very existence in the system is a pure negative and in fact a moral blight. Inflicting profit into a system that is entirely dedicated to human health is by definition a conflict of interest for basically everyone involved, even if it operated at a hypothetical 100% efficiency.
replies(2): >>42734733 #>>42743026 #
106. nradov ◴[] No.42734656{6}[source]
No, UnitedHealth Group made $22B in profit in 2023. Only about half of that profit came from the UnitedHealthcare insurance business. The other half came from the Optum side which is a mix of non-insurance stuff. Optum makes huge profits on software: if the software business was spun out it would be one of the top 20 US tech companies.

https://www.unitedhealthgroup.com/investors/financial-report...

107. rcpt ◴[] No.42734662[source]
Gotta catch up to Florida
108. mgiampapa ◴[] No.42734670{4}[source]
The book of business has to be large and the pockets deep. Which describes our current insurance market and the government. The way we handle this now is with reinsurance.
109. rcpt ◴[] No.42734695[source]
Most of the populated areas are perfectly safe from fire.

https://wildfiretaskforce.org/updated-fire-hazard-severity-z...

110. dboreham ◴[] No.42734702{4}[source]
That's not how these fires work. Wind and dry fuels mean they can't be put out by the time they've been identified and someone has verified they're not some dude burning trash. Drone armies can't carry enough water.
111. loeg ◴[] No.42734714[source]
> Same in Florida.

The Florida situation is actually markedly different. The main problem was extreme litigation-friendliness. Florida saw 80% of the nation's insurance lawsuits but only ~8% of the insurance business. They've also since passed some reforms (HB 837, 2023; SB 2-A, 2022).

112. umanwizard ◴[] No.42734733{5}[source]
Lots of things necessary for life are run by for-profit businesses — for example, food production. Do farmers have a “conflict of interest”? What about healthcare in particular makes profit immoral?
replies(2): >>42735140 #>>42735484 #
113. athrowaway3z ◴[] No.42734742{5}[source]
The dutch aren't insured against a dike breaking (Which has its own history).

But the dikes have been collectively maintained through laws and regulation from a local semi-democratic system for 800 years (separate from government). It was a necessity as 1 delinquent could screw up everything.

https://en.wikipedia.org/wiki/Water_board_(Netherlands)

replies(1): >>42738011 #
114. jpalawaga ◴[] No.42734765{3}[source]
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?
115. hnburnsy ◴[] No.42734771{3}[source]
How does just offering higher deductibles, hurt the 'poors'? Nobody said do away with lower deductibles. Are you saying they are not sophisticated enough to understand a proper deductible for their situation?
replies(3): >>42735138 #>>42735148 #>>42735189 #
116. rented_mule ◴[] No.42734774[source]
At some level, insurance is about spreading out financial risk. Insurance companies would love for every policy to be profitable, but if we let it go that far, it's merely a savings account with negative interest rates. At another level, insurance is about analyzing risk and making it more expensive to take bigger risks. Where do we want the tradeoff between these things? Whatever we choose, we have to have some ability to predict / evaluate risk.

In the face of climate change, places that have been safe for a very long time are becoming unsafe. But I don't see a reason these shifts won't happen over and over as climate change unfolds. It might be worse than mass migrations... migrations to locations which later become dangerous, turning into recurring mass migrations.

How well can we predict where it will be safe in the coming decades and where it won't. Coastal land at or below current sea level (plus storm surge) is fairly predictable, especially where there isn't the population density (and money) to support building sea walls. But with things like rivers changing course (e.g., https://en.wikipedia.org/wiki/Alsek_River), it might become very difficult to predict what's going to be safe down the road. Today we talk about things like 100-year flood plains, but how will we establish flood probabilities when the river that might flood in 10 or 20 years doesn't even exist today?

Are the people who get unlucky with predictions just screwed because their home equity is gone? Or are we going to decide to shoulder the burden together? We're going to find out a lot about humanity, the role of government, etc. as we go through all of this.

replies(1): >>42736036 #
117. gunian ◴[] No.42734776{6}[source]
but people always talk about how insurance is guaranteed in europe something must be working if gunning down a CEO is pro the people wouldn't copying one of the European countries be even more pro the people?

what makes senators hate something that is pro the people? wouldn't that give them better ratings? I come from a dictatorship so sorry if this is a dumb question

replies(3): >>42737474 #>>42738148 #>>42738180 #
118. Panzer04 ◴[] No.42734781[source]
Why is the burden on insurance companies to make up for individual poor decisions?

In some cases it makes sense to socialise the losses, but I'm not convinced this is one of them.

replies(1): >>42739313 #
119. Panzer04 ◴[] No.42734795{5}[source]
The people are risk pay less, all of the other people forced to participate in your general insurance pay more.

If I live in the middle of a city in an apartment block should I pay the same rates to insure against wildfire as someone in the middle of a dry forest? Probably not, but govenrment-mandated insurance programs force me to.

replies(1): >>42734889 #
120. matwood ◴[] No.42734815[source]
Since you mentioned FL, we have mostly solved hurricane level wind resistant building codes. Hurricane ties are cheap and they work. Anything built post hurricane Andrew has these. There's also materials like Hardi Plank siding, which does add a bit more cost, but effectively surrounds the house in a thin layer of concrete. Flooding is a mixed bag. My house is built substantially up and off the ground above the '100 year flood line'. Even if a flood didn't enter the dwelling proper, it would still be devastating.

The problem is storms are getting bigger and more frequent from climate change and hitting areas they normally don't.

replies(1): >>42734911 #
121. Panzer04 ◴[] No.42734817{5}[source]
Your seem to be under the misapprehension the problem is insurers charging usurious prices. The reality is Paul in the forest got used to paying whatever 5kpa to insure against a 100 year fire, not 50kpa to insure against a 10 year fire.

It sounds like a lot, but if the risk is actually that high then the prices will be too. Houses aren't cheap. Insurance is a very competitive market, it's easy to comparison shop. The root problem is the high risk, not "unfair" private profit.

(Numbers picked out of thin air to make a point)

replies(1): >>42735428 #
122. Panzer04 ◴[] No.42734835{5}[source]
Because from a moral standpoint most people agree that we shouldn't allow people to go without treatment, regardless of their poor choices. From a national standpoint it also doesn't make sense to allow people to become cripples for lack of money, reducing their economic value.

Injuries also hurt, so it's not like people don't have other disincentives to avoid injury aside from the price. This isn't the case in other areas, where it's purely a monetary penalty and thus removing that penalty results in way more of that thing taking place.

123. hnburnsy ◴[] No.42734844{3}[source]
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?

124. hnburnsy ◴[] No.42734857{5}[source]
>They don't, but they have the courtesy of giving myself and thousands of others a proper heads up. Perhaps any heads up? They quite literally just dropped me, no email, no letter, no nothing. This type of thing should be given 3 months minimum.

No way that happened, the state would not allow it.

https://ktla.com/news/california/state-farm-to-non-renew-720...

>It’s important to note that nonrenewal is not canceling. Customers affected by the decision will retain coverage until their current contract is up. The company said those impacted will be notified between July 3 and Aug. 20.

replies(1): >>42734920 #
125. Ekaros ◴[] No.42734874[source]
I think apt comparison would be collision coverage. How much would you charge from someone that collides a car each year. Probably more than cost of those collisions on average.
126. mgiampapa ◴[] No.42734889{6}[source]
Premiums should be based on risk, not flat. I don't know where you are drawing that line of reasoning from. Just because the government is providing coverage doesn't mean it's all the same rate. Every insurance product has a risk model to set prices. I was just advocating that we have a non profit minded entity with deep pockets do it vs private companies motivated by maximizing profit.

Public benefit corps fit this model as do regulated utilities.

replies(1): >>42735566 #
127. umanwizard ◴[] No.42734890{5}[source]
> To answer your utterly moronic question

I don’t think it was moronic at all; the point is to get to the bottom of what assumptions and axioms you’re using. What is the moral framework according to which you claim State Farm has wronged you. Only then can we judge whether your claim is in fact correct.

> because they aren't in the business of insurance

So, if I understand your implicit argument correctly, it seems to be that anyone who sells a product be forced to sell it to anyone, no matter how costly it is to them.

There’s no McDonalds in Barrow, Alaska, presumably because running a McDonalds there would be prohibitively expensive. Is that immoral? Should they have an obligation to open a store there?

replies(1): >>42734930 #
128. theultdev ◴[] No.42734911{3}[source]
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.

replies(1): >>42735603 #
129. rewgs ◴[] No.42734920{6}[source]
I can assure you that I received nothing of the sort. In fact, I only found out because I called about transferring my policy to a new house. And yes, I read all email/snail mail sent by them. I was given zero heads up.
130. rewgs ◴[] No.42734930{6}[source]
> So, if I understand your implicit argument correctly, it seems to be that anyone who sells a product be forced to sell it to anyone, no matter how costly it is to them.

That is clearly, clearly not my argument, but I have a feeling that you're one of those bad faith "and yet you participate in society, curious!" guys, so I'm done here.

131. inferiorhuman ◴[] No.42734992{3}[source]

  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.
Or they see that as a cute bit of misdirection. Profits are capped as a percentage of healthcare costs, sure. Healthcare costs are not capped. Drive up the cost of care, drive up the profits.

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

replies(1): >>42737894 #
132. refurb ◴[] No.42735042{3}[source]
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?

133. inferiorhuman ◴[] No.42735064{7}[source]

  In this list, I couldn’t find a single for profit BCBS licensee
  other than Elevance.
Keep in mind Anthem/Elevance absorbed a bunch of licensees. So, for instance, Empire BCBS was for-profit but as of 2024 is part of Elevance.

At a quick glance Highmark and Wellmark are for-profit. And I believe the South Carolina licensee is as well. Mind you a few of the "non-profit" BCBS licensees have been sued over claims that they ought not be considered not-for-profit.

replies(1): >>42737508 #
134. ◴[] No.42735138{4}[source]
135. inferiorhuman ◴[] No.42735139{9}[source]

  And FWIW, US Medicare spending alone is shaping up to grow to almost
  as much as some EU nations on a % of GDP basis
Your source puts Austria, France, and Germany at the top, or roughly 11–13% of GDP.

https://www.bea.gov/news/2023/gross-domestic-product-fourth-...

https://crsreports.congress.gov/product/pdf/IF/IF10830

The U.S. Bureau of Economic Analysis puts the 2022 GDP at $25.46 trillion ($25,460 billion). Congress puts 2022 spending on private health insurance at $1,290 billion (5%) and Medicare at $944 billion (3.7% of GDP).

replies(1): >>42735172 #
136. spease ◴[] No.42735140{6}[source]
If the grocery store decides to remove the prices from everything, and require its shoppers to first call its billing department only open until 5pm to receive a set of numbers, then call their third party subscription service only open until 6pm to receive a non-binding estimate, for every item in their grocery list, then wait weeks or months for the grocery store to have its cashiers take time away from checking customers out to petition the third-party subscription service to allow its customers to buy any item deemed to require prior authorization…

You can typically endure hunger for 15 minutes for the time it takes to go to another food store.

On the other hand, if you are bleeding out in the ER, no such luxury exists.

Insurance executives have a fiduciary duty to maximize the profit of the company.

If the company makes a profit off of treating patients, then it has a financial incentive to not approve treatments that would make patients better.

If the company loses money treating patients, then it has a financial incentive to deny treatment as much as possible.

Unless a legal structure is found which scales profit with quality of care, ethical choices will be at odds with the fiduciary duty of the company officers. Having an AI say “no” and putting someone on hold is a lot less expensive than paying out for a cure that cost billions to develop.

In the case of government-run healthcare, the government at least sees the consequence of poor health outcomes in decreased productivity, competitiveness, gdp, and/or tax revenue, as well as increased use of social services.

In other words, if the insurance company refuses to treat you, it costs the government money to pay for welfare indefinitely, not the insurance company.

There are lots of perverse incentives at work, and vanishingly few people even try to understand them, I think because most people simply don’t believe it could possibly be as bad as it is. And by the time they learn otherwise, they care more about getting healthy again than overextending themselves trying to solve a massively complex problem.

replies(2): >>42740238 #>>42744039 #
137. forgetfreeman ◴[] No.42735148{4}[source]
How does offering a deductible ranged well outside what the majority of households in the US can actually pay hurt anyone? If that isn't self-explanatory I'm not sure what to tell you.
138. mgh95 ◴[] No.42735172{10}[source]
Yes, we are tracking to grow to as much as some not all or most. Emphasis on tracking to grow which you should see the source for 2033 forecast.

The fact that one program (Medicare) is growing to be as large as the NHE should be cause for pause.

replies(1): >>42736289 #
139. consp ◴[] No.42735189{4}[source]
Higher deductibles generally lead to a lower overall money pool raising overall prices. They allowed that here in a far more regulated market and the effect was about 4pct higher prizes across the board. Effectively the people who cannot afford the higher deductibles are subsidizing the ones who can as the end result.
140. inferiorhuman ◴[] No.42735195{5}[source]

  mineral wool insulation aren't regarded as carcinogens
A quick look turned up one mineral wool SDS with a Prop 65 warning for formaldehyde.

https://www.jm.com/content/dam/jm/global/en/MSDS/20000000205...

replies(1): >>42735232 #
141. bawolff ◴[] No.42735221{5}[source]
Isn't that a bit misleading? Salaries wouldn't be included, but a lot of compensation at the very high end is based on owning stock, and dividends i assume would be part of that profit margin.
replies(2): >>42737548 #>>42738069 #
142. defrost ◴[] No.42735232{6}[source]
From your link:

SECTION 11. TOXICOLOGICAL INFORMATION

  IARC No component of this product present at levels greater than or equal to 0.1% is identified as probable, possible or confirmed human carcinogen by IARC.

  ACGIH No component of this product present at levels greater than or equal to 0.1% is identified as a carcinogen or potential carcinogen by ACGIH.

  OSHA No component of this product present at levels greater than or equal to 0.1% is identified as a carcinogen or potential carcinogen by OSHA
> warning for formaldehyde.

Trace amounts can possibly sweat out in specific conditions .. which is why you might choose to install with a vapor barrier.

replies(1): >>42736278 #
143. bawolff ◴[] No.42735237{6}[source]
Using absolute numbers here doesn't really make sense. 23B sounds big but its impossible to say if its a high or low profit margin without context.
replies(1): >>42736845 #
144. ◴[] No.42735260[source]
145. mgiampapa ◴[] No.42735428{6}[source]
Yes, I'm advocating people pay appropriately for risk. The issue is with high risk, insurers pad profits to compensate for excessive risk or leave the market with no option other than some last resort insurers. Having government step in with regulation around profits over time keeps the rates in check. You can have a Lloyd's of London, but they need to have open audited books. Otherwise you can have a not for profit, ie government entity run the book.
146. titzer ◴[] No.42735484{6}[source]
Oh yes, these things are exactly equivalent. Problem is, nothing about the health system's incentives aligns with consumer benefit. The most profitable outcome for an insurer is that everyone pays premiums and never uses any services. The most profitable outcome for hospitals is that they charge maximum prices for every service and yet don't really fix underlying problems or prevent future problems. Hospitals profit the most off patients that need a ton of care and have deep pockets. They lose money on giving care to people who cannot afford it and won't pay. They lose money in the long run when preventive care prevents later catastrophic (and expensive) conditions later. Pretty much all of the profit-maximizing forces in the for-profit system are deeply unethical.

If you're going to tell us that because health care providers and health insurance companies are some kind of magic counterbalance against each other that benefit consumers, uh, nope.

replies(2): >>42735766 #>>42737759 #
147. donavanm ◴[] No.42735566{7}[source]
Edit: i think were talking past each other until agreeing that risk/cost/rates are being intentionally suppressed by or on behalf of the public. Kind if like this other housing related mortgage thing Ive heard if that may be mispriced/misstructured in favor of many at the expense of all.

I dont get it. Your argument is that if everything was priced accurately and aggregated "fairly" insurance would work. Ok, totally true statement. Very much the case that's not what is happening now for any of the example markets or gov programs.

You appear to believe "profit" is the problem, which is true in that negative profit is known as "loss" which is what has and will be occurring even with the public "last resort" rates. The private insurers are not withdrawing because their "fantastic" 6-15% margin on disaster insurance isnt enough. Using CA as an example they withdrew because 1) the state required they dont use risk based modeling for individual rates and 2) they dont include reinsurance costs as a rate signal. Shockingly their CA insurance pool turned upside down on costs/losses in a decade or two and they bailed.

FAIR is exactly the sort of or youre talking about; non profit government mandated insurance pool, open to all residents, with proportional policy/loss assignment, rates set based on regulated-interpretation-of-risk-exposure + costs, regulated by the CA Dept of Insurance. And yes, their policies are risk adjusted, but theyre not _accurate_. And yes, insurance should accurate according to risk and (payout) costs but basically none of the public last resort issuers can!

See again florida, national flood, etc. In every case 1) risk & cost modeling (accurate pricing) is suppressed on behalf of the public 2) risk prices/costs soon exceed private risk markets 3) private insurers withdraw 4) public "last resort" insurers emerge 5) risks/costs continue to grow, private insurers withdraw, the "last resort" insurer becomes the risk aggregating insurer 6) last resort insurer shockingly cant meet its commitments 7) public funds and/or backdoor insurance taxes socialize losses due to unprices disk.

148. matwood ◴[] No.42735603{4}[source]
Great article, scientifically written. I wish it was as confident as you are in your conclusion.

> No, we cannot confidently detect a trend today in observed Atlantic hurricane activity due to man-made (greenhouse gas-driven) climate change. Some human influence may be present

> The importance of this distinction between potential causes of AMV for future hurricane projections is clear: if strong man-made aerosol forcing and volcanic forcing were responsible for most of the “quiet period” of Atlantic major hurricane activity from the 1970s through the early 1990s, then a return to this more “quiet” regime in the coming decades may not occur. But if the “quiet period” of the 1970s through early 1990s (as well as the earlier quiet period of the early 20th Century) was caused mainly by internal climate variability, one would expect to return to relatively “quiet” conditions in the coming decades as the climate swings back and forth between more active and inactive Atlantic hurricane periods. This is an important research question that does not yet have a clear answer.

Meanwhile we continue to see stronger storms.

> Another hurricane metric, the fraction of rapidly intensifying Atlantic hurricanes, was reported to have increased since around 1980 (Bhatia et al. 2019), and they found that this change was highly unusual compared with simulated natural variability from a climate model, while being consistent in sign with the expected change from human-caused forcing. Even so, however, their confidence was limited by uncertainty in how well the single climate model used was representing real-world natural variability in the Atlantic region.

We do know for a fact that the ocean temperatures are rising. Also from your article,

> Global surface temperatures and tropical Atlantic sea surface temperatures have increased since 1900 (by around +1.3 ˚C [+2.3 ˚F] and +1.0 ˚C [+1.8 ˚F], respectively), unlike the reconstructed hurricane counts or U.S. landfalling hurricanes. Finally, a number of studies have found that several Atlantic hurricane metrics, including hurricane maximum intensities, hurricane numbers, major hurricane numbers, and Accumulated Cyclone Energy have all increased since around 1980.

But climate science is about studying a complex system, and finding direct causations is hard.

> However, in a 2019 tropical cyclone-climate change assessment, the majority of authors concluded that the recent hurricane activity increases mentioned above did not qualify as a detectable man-made influences (meaning clearly distinguishable from natural variability).

Another study linked recently from climate.gov (near the bottom) https://www.climate.gov/news-features/blogs/beyond-data/2024...

>[R]ecent studies in attribution science show that climate change is causing an increase in the frequency and/or severity of tropical storms, heavy rainfall, and extreme temperatures.

So at the end of the day, it's fine to say there is no smoking gun, but it is absolutely not 'obviously false'. I think your biases are showing.

replies(1): >>42737737 #
149. EraYaN ◴[] No.42735759{6}[source]
I think the point is more that the insurers are not the real target for your wrath. You should not motivate your congress person to do something about the insurance necessarily. It's probably better to look at a level further up the chain for example.
150. umanwizard ◴[] No.42735766{7}[source]
> Oh yes, these things are exactly equivalent

A: All men are tall, therefore Giannis Antetokounmpo is tall.

B: Your proof is wrong: see this man here, he isn’t tall!

A: Clearly he has nothing in common with Giannis. He’s not even in the NBA!

151. snacksmcgee ◴[] No.42736036{3}[source]
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".
replies(1): >>42737967 #
152. umanwizard ◴[] No.42736228{5}[source]
Why?
153. inferiorhuman ◴[] No.42736278{7}[source]

  Trace amounts can possibly sweat out in specific conditions
Nah, it's pretty well documented heat and humidity will release formaldehyde. In paperwork filed with the EPA arguing against new limits, an insulation manufacturer trade group cited California's (OEHHA) exposure limits on formaldehyde as reasonable.

Those limits are:

  recently manufactured products contribute no more than 9 µg/m3 of
  formaldehyde into the indoor air
So the Prop 65 warning certainly seems reasonable from here.

https://downloads.regulations.gov/EPA-HQ-OPPT-2023-0613-0230...

replies(1): >>42744479 #
154. inferiorhuman ◴[] No.42736289{11}[source]
So your argument is that Medicare spending might potentially approach the same proportion of the GDP as a European country that doesn't spend a lot on its healthcare?
replies(1): >>42741983 #
155. davemp ◴[] No.42736524{3}[source]
> 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.

replies(2): >>42737725 #>>42737817 #
156. lordnacho ◴[] No.42736788{8}[source]
That's huge isn't it? $800 bucks in profit per customer? What does Apple make? Or Unilever?
replies(1): >>42737309 #
157. onemoresoop ◴[] No.42736845{7}[source]
It’s profit and it’s very large.
replies(1): >>42737301 #
158. gruez ◴[] No.42737301{8}[source]
That's going to be true for any nation wide insurance company.
159. gruez ◴[] No.42737309{9}[source]
Why compare to Apple, when the healthcare is arguably more complex and expensive?
replies(2): >>42737814 #>>42738861 #
160. selimthegrim ◴[] No.42737474{7}[source]
Senators have to spend $$$ to get elected
161. lotsofpulp ◴[] No.42737508{8}[source]
Highmark is non profit:

https://projects.propublica.org/nonprofits/organizations/821...

Wellmark is a mutual insurance company (profits go back to policyholders, seems not comparable to a for profit insurance business, and for this discussion, is not going to have a profit margin that results in higher costs to policyholders):

https://en.wikipedia.org/wiki/Wellmark_Blue_Cross_Blue_Shiel...

https://en.wikipedia.org/wiki/Mutual_insurance

>Mind you a few of the "non-profit" BCBS licensees have been sued over claims that they ought not be considered not-for-profit.

I see no successful lawsuits, though. Still seems like Elevance is the only for profit BCBS licensee.

>In 2014, BC/BS of Illinois (Health Care Service Corporation) was sued over its nonprofit status. The lawsuit was dismissed, with prejudice, and the dismissal ruling was upheld on appeal.[62] Similar suits occurred with similar results in other states such as Oregon.[63]

replies(1): >>42737736 #
162. lotsofpulp ◴[] No.42737548{6}[source]
Compensation, even in the form of equity, has an equivalent cash price that is owed at the time it is awarded. The receiver has to pay income tax for this compensation, even if it is not cash, and the business has to record it as an expense.

>and dividends i assume would be part of that profit margin.

Dividends and share buybacks are not expenses. They are not money spent for the purposes of operating the business, they are awards to the shareholders. As such, they are not an expense. Dividends and share buybacks happen with the profit, so they will never be included in expenses used to calculate profit margin.

There are lots of highly qualified people at the SEC and FASB working to ensure some semblance of accountability. There is a reason why people from all over the world want to invest in a developed countries’ public equity markets, and that is a belief that most of the time, the numbers are very close to the truth.

163. rafram ◴[] No.42737582{4}[source]
No. Forest fires should be allowed to spread to prevent fuel buildup. It’s bad when they cross into developed areas, though, so you want to prevent that.

If anyone ever implements your drone-based surveillance-state wildland fire suppression system, please let me know so I can avoid hiking in the area.

replies(1): >>42738329 #
164. carlosjobim ◴[] No.42737585{3}[source]
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?

165. ◴[] No.42737666{6}[source]
166. joshuaissac ◴[] No.42737725{4}[source]
I hear the same thing about supermarkets. Their margins are razor thin (1-3%), and yet people look at the overall profits and complain, ignoring the fact that the company had to deploy 50-100 times that capital to make that profit.

An alternative is to split these companies into smaller companies, which will each have much lower profits but also higher costs due to lost efficiencies, but people will not be happy with that either.

167. inferiorhuman ◴[] No.42737736{9}[source]
To be clear if Elevance is the only remaining for-profit BCBS licensee it's because they bought the others.

Highmark got labeled as for-profit on its Wikipedia entry likely because they own a variety of for-profit companies including e.g. Highmark BCBSD Inc. and Celtic Hospice LLC.

https://projects.propublica.org/nonprofits/organizations/453...

replies(1): >>42738000 #
168. theultdev ◴[] No.42737737{5}[source]
Ofc they hint towards it, it's climate.gov. But the actual data shown, shows no increase at all.

You won't find a "smoking gun" because it's not happening.

Your biases are in-fact showing that you don't realize you went from claiming it was true to "well we have no smoking gun".

169. gruez ◴[] No.42737759{7}[source]
>Pretty much all of the profit-maximizing forces in the for-profit system are deeply unethical.

Are you talking about healthcare specifically or businesses in general? AMD wants to make the best CPUs for the most amount of money. Is that "unethical"?

replies(1): >>42737801 #
170. titzer ◴[] No.42737801{8}[source]
> healthcare specifically

Yes, it is deeply unethical that someone can be bankrupted and become homeless because of a treatable condition because the "market" has decided a price for the service that is astronomical without insurance, while at the same time tying insurance to employment, dividing up insurance markets, and making coverage subject to inscrutable, unappealable decisions made by people sitting behind desks in a completely different part of the country, while the leadership of said organizations and investors make higher profits than ever. It is deeply unethical that a CEO can make tens of millions of dollars--which for most regular people is several lifetimes worth of earnings--in a single year, while dealing in a market that regularly denies coverage to people who then suffer, are financially ruined, and die.

It's not the same as making a better CPU for more money. Not. At. All.

replies(1): >>42743048 #
171. chii ◴[] No.42737814{10}[source]
the original OP is claiming that the healthcare industry is too profitable. So you have to compare it to something to see if it is too profitable.
replies(1): >>42738157 #
172. gruez ◴[] No.42737817{4}[source]
>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 federal government will pay you $4.4 billion a year[1] if you lend them a trillion dollars, no "shuffling money around" required.

[1] current 5-year treasury yields

replies(2): >>42738829 #>>42745399 #
173. gruez ◴[] No.42737850{6}[source]
> Whereas UK and Canadian politicians have to answer to their constituents.

Yeah, and "politicians have to answer to their constituents" is how we got the failed insurance markets in California and Florida. This thread has now gone full circle.

replies(1): >>42737920 #
174. gruez ◴[] No.42737894{4}[source]
> Or they see that as a cute bit of misdirection. Profits are capped as a percentage of healthcare costs, sure. [...]

You know what else is "a cute bit of misdirection"? Mentioning that profits are capped without mentioning why it's that way in the first place.

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

...because the government low-balls healthcare providers?

replies(1): >>42739049 #
175. lotsofpulp ◴[] No.42737920{7}[source]
That is the problem with conflating insurance and subsidy.

To buy votes, politicians sell “insurance”, but in reality it is a subsidy to a specific group of taxpayers.

When a government directly pays for healthcare, it can’t be called insurance, and so limits to the subsidy are easily attributed to the government leaders.

Whereas, if a government has the population buy “insurance” from non governmental entities, then it can pretend (for the layperson) that it isn’t a government subsidy and so the laypeople can blame limits of the subsidy on someone else.

Obviously, health insurance in the US is far from health insurance and premiums are closer to taxes being paid rather than premiums for one’s own health risks.

That isn’t so true in property and casualty insurance, at least not until governments like California step in.

176. gruez ◴[] No.42737930{4}[source]
>Health Insurance IS a huge racket. Insurance profits are only a small slice. Executive compensation isn't part of profits.

"Executive compensation" is even a "smaller slice" than profits, orders of magnitude smaller.

177. gruez ◴[] No.42737967{4}[source]
>Soon, people will realize that the entire economic system that caused climate change in the first place will not save us.

Disagree. "the entire economic system that caused climate change in the first place" is also responsible for the green transition, including cheap electric cars and renewable energy.

>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".

Alright, what's your solution to "the entire economic system that caused climate change in the first place" that aren't just "lol just stop capitalism"?

178. hb-robo ◴[] No.42737995{5}[source]
I get that we're on a tech forum but the vast, vast majority of people in this country don't have the financial ability to just move wherever they want. I'm not saying that means that Floridians shouldn't worry about this, but this bootstraps narrative is ridiculous. Everyone here makes substantially more money than the average Joe.
replies(1): >>42741978 #
179. lotsofpulp ◴[] No.42738000{10}[source]
But Highmark, the parent organization, is still a non profit. Based on their revenue and expenses on their 990 going back a decade, the entire organization is not delivering profit to any owners, it’s just spending money earned in its for profit subsidiaries elsewhere in its org.

Specifics aside, I think it is conclusively shown that no health insurance / managed care organization earns a ton of profit margin. No one is going to become billionaire rich by starting up a managed care organization, because they will spend almost all they earn.

It’s such a low profit margin business, that Buffett, Dimon, and Bezos abandoned it:

https://www.healthcarefinancenews.com/news/haven-disbands-en...

replies(1): >>42739027 #
180. gruez ◴[] No.42738011{6}[source]
The point is that the costs (to build the dikes) are fully internalized by the people who live there, rather than being cross-subsidized by people far away.
181. PaulDavisThe1st ◴[] No.42738042{9}[source]
> If we can't afford the current system,

What we can and cannot afford is a choice, not some immutable fact of nature.

A cynical, if realist, version of this would be: if we choose to not spend any more ...

But that's still better since it acknowledges that we, as a nation, have agency in this.

182. hbosch ◴[] No.42738069{6}[source]
>Isn't that a bit misleading?

In practice yes, but technically no. If a "non-profit" brings in 100 million dollars, and pays all 100 employees a million dollar salary, then that "non-profit" has made no profit. But when someone hears that a "non-profit" made "100 million" dollars, they think it is some kind of scam or something.

183. hb-robo ◴[] No.42738148{7}[source]
There is an unlimited amount of potential financial gain from American politics, both in lobbying and campaign financing. It is also widely true that the candidate with the most money spent in a campaign is heavily favored to win the election, with the exception of the presidency which is more contested. Now consider that in the 2020s the richest people now have more money than God.

The short of it is that you can get anyone you want in office, to do anything you want even if it directly opposes their constituency, as long as you spend enough money on them to get them in office, buy their vote, and keep their PR afloat.

Gilens and Page (2014) found that "average citizens and mass-based interest groups have little or no independent influence" on American government policy: https://www.scienceopen.com/document?vid=e4797592-9d73-4f2b-...

Worth noting that this paper saw pushback for many years after the fact but measurably, its conclusion has been true since its release.

184. gruez ◴[] No.42738157{11}[source]
Right, but why use Apple ($800 phone every 2-4 years) compared to say, an automaker ($40k in depreciation over 10 years) or a REIT ($2000 in rent every month)? Moreover, why focus on absolute profits? If the healthcare industry split into 3 (eg. doctors, dental, drugs) but with the same margins, does that mean they're suddenly not "too profitable"?
185. hb-robo ◴[] No.42738175{4}[source]
I'm all for this, lol.
186. mercutio2 ◴[] No.42738180{7}[source]
Murdering people is not pro anything.

The answer was already given: it was politically infeasible to pass a single payer variant in the US. And it’s not clear it would have been good even if it had been feasible.

replies(1): >>42745009 #
187. EGreg ◴[] No.42738329{5}[source]
That seems incredibly dangerous. As you said the wind can pick them up and cause an inferno.

If you want to do controlled fires IN ADDITION to the fire suppression system, you can. If fires are the only way to neutralize the fuel, at least control them, and don’t allow any uncontrolled fire to spread and get out of hand. The controlled burns would be planned in advance, done on good days and isolated from spreading too far. Of course those burns would be excluded from the fire suppression system.

But it seems reckless to just “let the fires spread”. You need actual control over fires if you want to have any chance of avoiding disasters.

Imagine you did this in any other area where you're in charge of a system. For example you run a forum and refuse to implement any sort of moderation or spam control. You claim we shouldn't put anything in place to clamp down on it and need to let things run their course naturally, because sometimes risking spam is necessary to get really good updates about stuff by experts. The proper thing to do, then, is to intercept spam from spreading as much as possible but then carve out a whitelist of exceptions. Not to simply not have an anti-spam system at all.

replies(1): >>42743314 #
188. jobs_throwaway ◴[] No.42738537[source]
> With no price caps, no one will be able to buy insurance even if required by law

I very strongly doubt that say Elon Musk or Jeff Bezos wouldn't be able to afford market-rate insurance costs. They would just choose not to because its too expensive. Which is the point of letting the market set the rate

189. marcosdumay ◴[] No.42738829{5}[source]
Those people are not collecting the profits by moving their own money around.
190. lordnacho ◴[] No.42738861{10}[source]
They are just other things people commonly spend money on
191. inferiorhuman ◴[] No.42739027{11}[source]

  But Highmark, the parent organization, is still a non profit.
So? The Mozilla Foundation is non-profit but Mozilla Corporation is for profit. They're delivering profit, just with an added layer of indirection. In this case the Highmark parent is technically a non-profit but e.g. Highmark BCBSD, the Delaware arm, is a for profit BCBS licensee.
replies(1): >>42739580 #
192. inferiorhuman ◴[] No.42739049{5}[source]

  ...because the government low-balls healthcare providers?
And yet Medicare is widely accepted. Go figure.
193. marcosdumay ◴[] No.42739136{4}[source]
Place a piece of wood inside the hot environment of a fire and it will burn down releasing more heat than it absorbs, adding to the fire. It doesn't matter what stuff you add to it.

You can make wood not burn on the kind of environment where it would be the only or main object releasing heat. That is still a completely different category from non-flammable materials.

194. jmclnx ◴[] No.42739313{3}[source]
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.

replies(1): >>42744963 #
195. gordian-mind ◴[] No.42739326[source]
"With no price caps, no one will be able to buy insurance even if required by law."

Burden of proof?

196. lotsofpulp ◴[] No.42739580{12}[source]
> They're delivering profit

To who? Are there shareholders profiting? Employees on the take?

> Unlike the non-profit Mozilla Foundation, and the Mozilla open source project, founded by the now defunct Netscape Communications Corporation, the Mozilla Corporation is a taxable entity. The Mozilla Corporation reinvests all of its profits back into the Mozilla projects.

https://en.wikipedia.org/wiki/Mozilla_Corporation

It’s the same with Highmark, assuming there isn’t massive fraud happening.

197. bytwhytyte ◴[] No.42739590[source]
Let's not forget insurance company greed. They are traded on the stock market and must provide returns to their investors. Let's not pretend they are not also part of the problem. Same with health insurance, it should never be for-profit, IMHO.

But I do agree they should be able to set the premiums, otherwise they just go bankrupt. People should not live in idiotically constructed neighborhoods in danger zones if they can't afford it. But they shouldn't be gouged.

replies(1): >>42740187 #
198. frinxor ◴[] No.42740187[source]
Insurance companies are for profit. They run the analysis of how much they need to charge to break even, and aim to charge above that. If they charge too high, customers will look at the alternatives and switch to a competitor.

You can replace "insurance" with any other business, the whole of capitalism is built upon this. Every stock on the stock market is trying to "provide returns to their investors" - each one is as guilty as the next - theres nothing special about insurance companies.

If the argument is that insurance should be a federally provided service, then we must have a different conversation. Look at the FAIR plan. They are government created, and will get wiped out because of these fires, possibly because they weren't charging enough to begin with (and taxpayers will now need to bail them out). The math doesn't change whether its state backed or privately backed. If a home, on average, gets burned down every X years, then the insurance premium needs to be adjusted to be able to cover that.

And here is the crux of the problem - if you take away the free market aspect of being able to adjust prices, and get forced to sell a product/service for less than what you need to, there will be a loss somewhere, in this order of operations:

1. loss at the insurance company --> insurance company goes broke or leaves the state

2. loss at the FAIR plan --> FAIR plan reserves get wiped out

3. loss at the state level --> taxpayers need to bail the situation out.

Id argue that letting the free market work (at layer 1 above) is the proper way about it. If a house burns down every 10 years, let insurance charge 10% of that cost, because that is the actual risk involved in the system. House prices will naturally come down to reflect that reality of risk.

199. zie ◴[] No.42740238{7}[source]
> Insurance executives have a fiduciary duty to maximize the profit of the company.

Probably not. Many insurance companies are not "for profit" companies(not a 501c3, something else). Certainly some are, but most of the giant ones, State Farm, etc are not. Most are Mutual Insurance companies: https://en.wikipedia.org/wiki/Mutual_insurance which handily includes a list of them.

I.e. they are operated more like Vanguard, the investment firm than they are Fidelity(a private for profit company) or Schwab a public for-profit company.

Also, this fiduciary duty thing is not really true, but people think it's true. They do have a duty to work in their shareholders best interests. Lately that's been taken to mean profit above all else, but that's a recent(last few decades) interpretation.

> If the company makes a profit off of treating patients, then it has a financial incentive to not approve treatments that would make patients better.

It depends on if they share the cost(s) of keeping patients healthy or not. Incentives matter. If they are incentivized to keep people healthy, instead of just treating X disease today, it would be a different conversation.

> In other words, if the insurance company refuses to treat you, it costs the government money to pay for welfare indefinitely, not the insurance company.

> There are lots of perverse incentives at work

Agreed. But mostly it's just excess waste as far as I know. I'm not an expert in healthcare, so I'm at best a armchair quarterback here.

200. stkdump ◴[] No.42740487[source]
This logic makes absolutely zero sense. If a house is uninsurable, people will choose to live there without insurance. But if the house is insurable for a high cost people will not? They can still choose to not buy the expensive insurable and be in the same boat as inunsurable home owners.
replies(1): >>42743434 #
201. therealdrag0 ◴[] No.42740795{3}[source]
If you’ve actually done the calculations with real numbers share the math. Otherwise stop assuming the conclusion.
replies(1): >>42744672 #
202. qeternity ◴[] No.42741138{6}[source]
Which effectively means that anybody in a less risky area of California is just subsidizing those who live in the risky areas. Premia across the board will increase as a result.

Typical California redistribution...but this is from the bottom to the top.

203. ikrenji ◴[] No.42741749[source]
why not have a 100 feet buffer clear of vegetation around housing? seems like an easy fix.
204. elevatedastalt ◴[] No.42741978{6}[source]
Agreed in general, but is it reasonable to say to people living in multi-million dollar houses on some of the world's most coveted real estate that they are should assume the risks of it? Or move?
205. mgh95 ◴[] No.42741983{12}[source]
Pretty much. And that's just one program that services a small portion of the population. The issue is we can't make this level of spending work, why should we believe spending more money will be successful?
206. cryptonector ◴[] No.42742138[source]
The governments know this and yet set the insurance premium price ceilings anyways.

At some point you have to consider that as indistinguishable from having a policy to drive people out: deny them insurance, wait for natural disaster, redevelop the now-very-cheap land however the government and its developer friends wants. Whether such a policy is adopted on purpose may not be possible to tell. You'll get called a conspiracist if you even hint that you wonder about it. But you know these people know -it's hard to believe that they don't- what happens when you set price ceilings.

207. ◴[] No.42742291{3}[source]
208. epistasis ◴[] No.42742435{3}[source]
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.

replies(1): >>42745441 #
209. greenavocado ◴[] No.42742768[source]
The issue is not that people believe that insurance companies are not pricing risk correctly. It's that because there is so little competition in the market, people are aware that insurance companies can charge higher premiums because they operate as an oligopoly.
replies(1): >>42743707 #
210. nickff ◴[] No.42743026{5}[source]
I don’t think health insurance is actually insurance, but I have seen little evidence that it has “insane profit margins”. From what I’ve read, ‘health insurance’ has middling profit margins relative to other insurance specialties; where are you getting that view/data?
211. nickff ◴[] No.42743048{9}[source]
You can also become homeless because the market has decided that rent should cost more than you can afford (in a given area). This involves real estate, equity investing, home insurance, zoning, housing regulation, and banking. Is this equally immoral? How many types of business are similarly immoral?
212. rafram ◴[] No.42743314{6}[source]
Well, a lot of people at the Forest Service and other land management agencies used to think like you do. We focused on full suppression throughout the 20th century. Now, when a forest fire does start, it isn't controllable like it used to be. There's too much fuel lying around that we prevented from burning for over a century.

Prescribed burns make sense in certain high-risk areas, but there's no substitute for actual, natural forest fires. We can never artificially cover the same kind of area that a natural fire can cover.

> For example you run a forum and refuse to implement any sort of moderation or spam control. You claim we shouldn't put anything in place to clamp down on it and need to let things run their course naturally, because sometimes risking spam is necessary to get really good updates about stuff by experts.

That analogy has absolutely no bearing on anything we're discussing. Online forums and human behavior aren't a good analogue for forests and forces of nature.

213. e44858 ◴[] No.42743434[source]
Will banks give out loans for houses without insurance?
214. epistasis ◴[] No.42743707{3}[source]
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.

215. mym1990 ◴[] No.42743881[source]
Its interesting because the last 5 years in the US have seen a dramatic appreciation in housing prices, and also a seeming rise of risk of catastrophic events, and insurance companies are grappling with these 2 things. Ultimately maybe different insurance products could be provided that effectively offload some or all of the risk to the home buyer(which obviously is a not a good scenario for banks giving mortgages).
216. SilasX ◴[] No.42744039{7}[source]
>If the grocery store decides to remove the prices from everything, and require its shoppers to first call its billing department only open until 5pm to receive a set of numbers, then call their third party subscription service only open until 6pm to receive a non-binding estimate, for every item in their grocery list,

Good point (buying food would be a nightmare if it worked like American health care!) but that's a different argument from the one made above in the thread, that a profit motive in a vital good inherently creates perverse effects.

217. SilasX ◴[] No.42744063{3}[source]
>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!"

218. defrost ◴[] No.42744479{8}[source]
Vapor barriers limit human exposure, it has to travel into the occupied spaces to be an issue, then linger.

It also has to be the type of wool that has been treated, etc.

219. sadeshmukh ◴[] No.42744672{4}[source]
The calculation was done by the insurers who refuse to insure the area, or must subsidize all insurance with nearby policies.
replies(1): >>42744865 #
220. munificent ◴[] No.42744799[source]
But if they don't set a price ceiling, then insurance companies price gouge.

You can't get a mortgage without insurance, so if insurers were allowed to freely control the price, they'd charge an arm and a leg since buyers are forced to buy. If insurance companies are allowed to freely raise their prices, then they would certainly love to do so because any homeowner with a mortgage would be absolutely stuck and have to pay whatever they demand or risk the bank taking their home back.

I think you have an idea that the free market would naturally lead to an efficient insurance price that let's them cover disasters. But markets aren't magic, and insurance markets are anything but efficient. I don't think anyone really knows what the "right" price for homeowner's insurance is in places like Florida and California.

replies(1): >>42744895 #
221. therealdrag0 ◴[] No.42744865{5}[source]
Surely there are rates at which they’d would insure the area? And you have shared no data on who is or is not willing to pay those rates.
222. desmosxxx ◴[] No.42744895[source]
The right price is the market price. There are multiple insurance providers and sufficient competition. And certainly the time to raise the limits is when companies are leaving the state?
223. desmosxxx ◴[] No.42744963{4}[source]
> High rates will in a way prevent building in those areas.

good?

224. gunian ◴[] No.42745009{8}[source]
Sentiments on Luigi seem to put him on the same level as Rosa Parks or Jesus Christ if not higher both on HN and Reddit but that is ancedotal

Could you say a bit more about the politics? this is very fascinating idk much about insurance or politics

This may be super simplistic but Europe, if you look at it at a high level, is as diverse as US states if not more because a lot of places have multi party systems instead of a two party system with comparable diverse interest groups and comparable GDP etc

What did they figure out to have insurance that the US can't? Or doesn't want to?

225. jakeinspace ◴[] No.42745399{5}[source]
$44 billion
226. rewgs ◴[] No.42745441{4}[source]
Thank you, will do.
227. BobAliceInATree ◴[] No.42745848{3}[source]
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.
228. dweez ◴[] No.42745912[source]
Can't get insurance -> can't get a mortgage -> can't buy a house