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Thursday, August 31st, 2023

Climate change raising risks of financial disaster for homeowners, insurers and bankers

Author:     SAUL ELBEIN
Source:     The Hill
Publication Date:     08/30/23 | 6:09 PM ET
 Link: Climate change raising risks of financial disaster for homeowners, insurers and bankers
Stephan:  

Exactly as predicted in SR, insurance companies are bailing out of areas and states where climate change has created crises that make it impossible for them to make their usual profits. We are going to see more and more of this and it is going to create an internal migration of people who can’t get insurance. But even worse they won’t be able to sell their property because anyone who has to have a mortgage will also have to be able to get insurance. As this article also describes this is going to have an enormous impact on banks since the majority of mortgages are held by banks. If you own property in a coastal area I would begin to think about selling it before your area faces an insurance crisis.

 A road is completely filled with a tall pile of debris from destroyed beachfront homes and businesses, two days after the passage of Hurricane Ian, in Fort Myers Beach, Fla., Sept. 30, 2022. Florida’s home insurance market was already on shaky ground. It now faces an even mightier struggle after the damage caused by the hurricane. Credit: Rebecca Blackwell / AP Photo

The rising weather-related risks from climate change, from coastal hurricanes to western wildfires, are increasingly pinching insurance companies, which are raising rates and pulling back from parts of the country in an effort to stay in business.

Just this summer, two major insurance companies left Florida, adding to the long list of companies that have left the state. 

In July, Farmers Insurance announced it would no longer write policies in the state; in August, United Property and Casualty went bankrupt, leaving 22,000 of Floridians high and dry and all Florida residents having to foot the bill to bail it out. 

Banks could be next, said Dennis Kelleher of public interest […]

Read the Full Article

1 Comment

  1. Albus Eddie on Friday, September 1, 2023 at 5:39 am

    As the article states: “In July, Farmers Insurance announced it would no longer write policies in the state; in August, United Property and Casualty went bankrupt, leaving 22,000 of Floridians high and dry and all Florida residents having to foot the bill to bail it out. 
    Banks could be next, said Dennis Kelleher of public interest nonprofit Better Markets.” Insurance Companies are in the business of evaluating risk. That’s their job. they are supposed to be professionals, but they have failed, and therein lies the rub. The expectation that the tax payer will bail out the private corporation. Corporate socialism. Part of the time worn Reagan era doctrine, “privatize the profits, socialize the costs”. Let me suggest another alternative – capitalism. We have spent far too much time and money bailing out private corporations over the past twenty years with the citizens having nothing to show for it. Corporate officers and boards of directors do not have their wealth stripped from them. It’s business as usual.

    As the article continues: “It’s unclear how many uninsured properties exist in the United States, which itself is a danger. “While you would think that state insurance regulators would have created such a database and series of reports through the National Association of Insurance Commissioners, this is unfortunately not the case,” Carly Fabian, a specialist in insurance and climate change at nonprofit Public Citizen, told The Hill.”

    Government fails and corporations profit. There is a name for this unholy alliance between Corporate Power and the Government – fascism. Who will defend such a system except those who benefit from it?