Of course they should be covered. My issue is more with the fact that we shouldn't be subsidizing million dollar homes so they can have insurance. Apparently, according to some of the people here, oceanfront property in nj is inexpensive. That's b.s. of course. Earthquakes/forest fires/tornadoes can happen over a HUGE area.(entire states!) So of course they should be covered. Their not building in some super high risk area. People who build multi-million dollar homes on stilts on the beach should not be getting bail outs from tax payers. Current law subsidizes their insurance. It shouldn't.
FEMA operates under the department of homeland security, an extension of the patriot act, the brain-child of war criminals like GW Bush and **** Cheney. By association alone I don't trust FEMA. The resources preparedness act...check that one out if you want to have nightmares.
FEMA used to be a pretty good operation before it was absorbed by DHS. DHS grabbed a lot of FEMA's resources and never paid much attention to it or it's mission. They're too busy collecting emails and harassing journalists.
I understand what you are saying... I know you're only talking about the beachfront property that is extremely vulnerable... I was replying more to Pinkstink's commenting on people living on the coast.
Because in an overwhelming amount of cases insurance company's will not insure coastal homeowners, specifically because of the risk of hurricane damage.
Earthquakes typically affect much smaller regions than hurricanes and I believe Cali may have a requirement for Quake insurance that has some gov't subsidy. Quake prone zones are pretty well understood and could be avoided if you wanted. The reason that we have had so many fire fighter deaths recently in forest fires is that people also like building nice houses (both millionaires and not) in the forest near mountains. Now the gov't has to prevent fires that in many cases should and could be allowed to burn themselves out naturally and restart a natural cycle. At least in hurricanes, the majority of the damage is property. We dont have people out in boats trying to block the waves!! Although it costs alot to rebuild bridges, roads, sewers, etc. Upshot is that we have lots of people and the places that are the nicest to live often have risk. Either we all cross cover each other through the gov't (FEMA, Cat fund, etc) or allow the private markets to do it through insurance. In all cases there is a transfer of risk and money that the beneficiaries will like and the others will not. And to be sustainable, it will have to be expensive because the risk is high and real. If the subsidy is removed, the rest of the coast will look like the Hamptons where only people who can afford to rebuild their houses or pay $30k+ per year in insurance can live. Population density will certainly go down which would be a pretty interesting process... In terms of the high cost of coastal or prime mountain real estate, that is the much bigger issue of wealth dispersion which I am not going to touch. But the fact is that whatever your views on it, lower income people will be priced out of many areas that perhaps they used to be able to afford. Personally, I think it unfortunate but thats what our societal priorities are. may Bill be the model for all future Hurricanes (with apologies to anyone in the Carrib who had their house wrecked and their insurance not pay for it or anyone else who finds this offensive...)
Coastal windstorm is a non-diversified risk with high severity of loss with a difficult to project occurence. This means that an insurance company would have to price the insurance very high due to high uncertainty and risk of a storm requiring a payment that would make them insolvent. VERY simple math: $1mm house that could be expected to be destroyed in a 50 year event - allowing for costs and profits (from investing the premiums) you are going to be looking at $20k per year as your starting point. With non-correlated risk you get a benefit from the diversification of your policies across different locations, holders and risks. This does not exist for coastal windstorm.
Are you still going on about GW Bush and Cheney? They are no longer relevant. I thought this was a surfing forum.
Cheney don't surf! on a completely random note, anyone notice the banner add for the TYR Hurricane Freak of Nature suit for $1,079.95!!! The perfect suit for a 150k board from a $3mm house.
This thread is dead... a bunch of depressing and bothersome facts and reality. On to the next subject, like when is the next Sharknado predicted, or something else important.
