Anthropogenic Global Warming ... how hot is it ?

[Shiftless2]

After the Dog Head fire in New Mexico, where hundreds of homes were destroyed, State Farm just almost immediately canceled thousands of fire insurance policies all over the state.
There were no refunds, inspections, or any sort of reasonable actions.

Not that I blame State Farm for stopping writing in the state but I don't see how they could simply cancel mid-term (i.e., before the policy period had expired) without a refund. But I expect you mean they "non-renewed" your policy which simply says that won't issue you a policy for another year. That's totally different from cancelling.

I had to go to the local fire department to get advice, and they told me that Farm Bureau was about the only alternative left.

And that's why I think you're confusing "cancelling" a policy with "non-renewing" it.

 

[Shiftless2]

With something like health insurance, you start paying in during your 20s, at something like $1000/month for a family.
You have been paying in close to half a million by the time you are 60 years old, and then when you are likely to actually need medical care, then can just drop you and keep that half million.

Health insurance works like auto insurance. Your premium pays for your coverage for the policy period and is not some sort of "deposit" against future losses. The insurance company does not have an account labelled "Rigby".

 

[sear]

"Health insurance ... The insurance company does not have an account labelled "Rigby"." S2 #462

BUT !
It does have an account labelled "insureds". It's not Rigby alone, but all policy holders, pooled into one.

Right?

 

[sear]

"... they told me that Farm Bureau was about the only alternative left." R5 #460

Concrete & steel !

 

[Shiftless2]

BUT !
It does have an account labelled "insureds". It's not Rigby alone, but all policy holders, pooled into one.

Right?

And that account will be used to pay this year's claims with nothing left over for future years.

 

[sear]

"... with nothing left over for future years." S2 #465

"Nothing left" for the policy holders I imagine. BUT !

I doubt insurance companies are run as $break-$even charities. Which means they $profit within what government regulators allow.

Right?

xxxxxxxxxxxxxxxxxx & xxxxxxxxxxxxxxxxxxxx

New York State law requires licensed automobiles operated on public roadway to be liability insured. BUT !!
An exception exempts vehicles the driver / owner self-insures.

I forget the $details, but:


How could we not be magnificent? Our State exclamation is also a packing material.

 

[Shiftless2]

"Nothing left" for the policy holders I imagine. BUT !

I doubt insurance companies are run as $break-$even charities. Which means they $profit within what government regulators allow.

How could we not be magnificent? Our State exclamation is also a packing material.

You're missing the point - this year's premiums pay this year's losses and expenses. They are not used to set up some sort of bank for future years. [Whole life insurance and pensions are a completely different matter.]

 

[sear]

"You're missing the point -" S2 #467

My specialty?

" this year's premiums pay this year's losses and expenses." S2 #467

My intended meaning precisely. [But insurance premiums still cover both claims plus insurance administration costs. ]

I can't think of a more sensible approach. Asbestos underwear?

nah

 

[Rigby5]

Not that I blame State Farm for stopping writing in the state but I don't see how they could simply cancel mid-term (i.e., before the policy period had expired) without a refund. But I expect you mean they "non-renewed" your policy which simply says that won't issue you a policy for another year. That's totally different from cancelling.


And that's why I think you're confusing "cancelling" a policy with "non-renewing" it.

I do not remember well enough since it was a couple years ago.
It could be cancel or non-renew.
But it still seems wrong to have people pay in for over 20 years, and then get dropped with nothing returned from all that money paid in.

 

[Rigby5]

Health insurance works like auto insurance. Your premium pays for your coverage for the policy period and is not some sort of "deposit" against future losses. The insurance company does not have an account labelled "Rigby".

That makes no sense because the charge is the same whether you are 20 or 70, and yet their risk obviously is very different.
It should be illegal to cancel a person from health insurance simply because they finally need some health work done.

 

[Rigby5]

You're missing the point - this year's premiums pay this year's losses and expenses. They are not used to set up some sort of bank for future years. [Whole life insurance and pensions are a completely different matter.]

And that is the point, that it is immoral and should be illegal to not track pay-ins and pay-outs over a lifetime, since no one normally needs any health care when young, but everyone needs health care when older.
It is immoral to force people to pay-in when young and then cancel people as soon as they get old enough to need pay-outs.

 

[Rigby5]

You're missing the point - this year's premiums pay this year's losses and expenses. They are not used to set up some sort of bank for future years. [Whole life insurance and pensions are a completely different matter.]

That is deceptive.
It should be obvious that if you knew the policy could be cancelled, you never would have even considered buying the property in the first place.
It is totally inappropriate to allow someone to have a policy for health, home, or auto, and then for no reason related to the customer, simply cut them off and not allow any further coverage.

 

[Shiftless2]

But it still seems wrong to have people pay in for over 20 years, and then get dropped with nothing returned from all that money paid in.

Not at all - the premium you pay this year is to cover this year's exposure. Nothing more. There is no "bank" to return.

 

[sear]

"Not at all - the premium you pay this year is to cover this year's exposure. Nothing more. There is no "bank" to return." S2 #473

I understand that.
I think R5 does too.

My understanding of his position isn't a purely dollar style investment, but a broader principle of business partnership which some perceive to strengthen over time.
The insurance company's liability may have changed, or become clearer, or for other reason, increased the policy premium.

FINE !
If the cost of the policy leaps 50% shouldn't the insurer simply inform the policy holder that upon renewal, and then let the policy holder decide?

Unilaterally severing ties with a reliable bill payer is not optimal business practice. My apology R5 if I've misrepresented your position.

 

[Shiftless2]

If the cost of the policy leaps 50% shouldn't the insurer simply inform the policy holder that upon renewal, and then let the policy holder decide?

That often happens but what tends to happen in that case is that the policy holder shops around and looks for a less expensive option.

That said, why the cost increase by 50% unless there's a problem of some sort. That's not just "inflation"

And then there are cases where the insurer doesn't want to do business in a particular region anymore. Or doesn't want to write a particular class of business anymore.

 

[Rigby5]

Not at all - the premium you pay this year is to cover this year's exposure. Nothing more. There is no "bank" to return.

Wrong.
If your insurance is going to be dropped, you never would have ever even started buying insurance at all.
To encourage purchasing the policy and then dropping it later for no reason is essentially fraud.