Is the world becoming uninsurable?

American, living in area prone to natural disasters: "Is the WHOLE WORLD becoming uninsurable?"

The answer is obviously "no" since there are other parts of the world that don't live on a hurricane highway nor build houses made from firewood in an area prone to wildfires.

Do we know why the insurance companies can't simply raise the insurance price to match the risks in those areas that are prone to natural disasters? I mean in general, not as in California where the government imposes strange policies. Speaking of the policy, why wouldn't California allow the insurance company raise the premium by region? Doesn't such policy benefit the rich at the cost of the poor as the rich love to live by the hills, lakes, or beaches, which is very much against the ideology of California?

It's more complicated than that, as always. Here's some (incomplete) background on Florida:

https://www.civilbeat.org/2024/03/how-floridas-home-insuranc...

Re: California, I don't understand the context for your question, or why you would think the California government is more strange than any other US state government. There's no universally-accepted "ideology of California." It's a big state with a huge, diverse population.

tl;dr, though: California does allow insurers to do that, but is using currently an antiquated set of rules that don't allow for modern risk management approaches. It's been rewriting those rules recently to fix this; I think the new rules are supposed to be in effect starting this year.

California's insurance policies are more strange, due to proposition 103, passed in 1988.

It creates a condition where the state can prohibit insurers from selling to residents, if it doesn't like their prices, which has recently lead to a lot of insurers no longer selling in the state, as construction prices in the state have risen significantly faster than inflation, leading to insurance premiums that the state doesn't like.

Residents who no longer have any insurers available can buy insurance from the state, but its far more expensive than the plans it rejected from private insurers.

> Residents who no longer have any insurers available can buy insurance from the state, but its far more expensive than the plans it rejected from private insurers

Sounds like a state-run racketeering business

No, it's likely running at a loss.