Huge losses from national disasters prompt industry to jack up prices and pull back from some markets; ‘worst possible scenario’ for consumers
After Allstate suffered billions of dollars in losses and failed to get the rate increases it wanted, it resorted to the nuclear option.
The insurance giant threatened last fall to stop renewing auto insurance for customers in three states that hadn’t given in to its demands, which would have left those policyholders scrambling for coverage. The states blinked.
In December, New Jersey approved auto rate increases for Allstate averaging 17%, and New York, a 15% hike. Regulators in California are allowing Allstate to boost auto rates by 30%, but still haven’t decided on its request for a 40% increase in home-insurance rates after the insurer refused to write new policies.
For many Americans, getting insurance for both their cars and homes has gone from a routine, generally manageable expense to a do-or-die ordeal that can strain household budgets.
The core of the issue is people shouldn’t live in these places.
Insurance companies provide insurance. It’s like people in this thread don’t know what insurance is.
What it isn’t: making a poor financial decisions and someone giving you money because you make a stupid decision.
Insurance is about risk. Insurance costs more than you gain, that’s how it’s designed. On average people lose on insurance, but the way people work is they would rather guarantee losing small amounts than risk losing a big amount. Insurance doesn’t work any other way.
Your group needs to pay small amounts each to cover occasional large expenses. If the system is full of large expenses then the group needs to pay large expenses each and then there is no point of insurance.
Christ. People just want feel good answers rather than living in reality. Climate change is coming. It’s been well known since the 80’s at the latest. You have been signing cheques and now the bill is due, you could have gotten out 40 years ago.