State Farm ceasing new applications in California for property insurance, other policies

[GON]

I agree in theory. But this is like where I live. Places that sell motor oil refuse to accept it in return.

NYS has a law they must accept. I believe when actors don’t act right, govt needs to step in.

Btw—a little different. I have never met a single person, regardless of their politics, who said they miss the pre existing conditions clause. Even as a healthy 30 yo that was a pita to me (job changes). Insurance always dragged their feet in producing the proof of creditable coverage cert. I’m not making it up…the govt helped all of us with it

You are the person that can solve the used motor oil situation in your area. One idea is to find a business that will take the oil, and tell the owner all of your family, friends, neighbors, and associates will exclusively use that store for all their parts needs, in support of the store taking the used oil .

Another is for you to open a business to accept the oil. Find a market for the used oil. Maybe even charge for accepting the used oil, and then selling it
.

Free enterprise can solve almost any problem or challenge.

 

[John105]

You are the person that can solve the used motor oil situation in your area. One idea is to find a business that will take the oil, and tell the owner all of your family, friends, neighbors, and associates will exclusively use that store for all their parts needs, in support of the store taking the used oil .

Another is for you to open a business to accept the oil. Find a market for the used oil. Maybe even charge for accepting the used oil, and then selling it
.

Free enterprise can solve almost any problem or challenge.

In reality if I get a normal joe, they accept the oil. A management type will say tank full.

 

[Kestas]

When you have a condo in Florida, you are only liable from the walls inward. I opt to have no insurance on my Florida condo. Haven't had insurance for 20 years. Haven't had a mortgage for 20 years. When I first insured the condo 40 years ago, insurance cost $77 per year. Now my neighbor is paying $3400 per year! I'm trying to tell her that self-insuring is an option.

If any disaster happened, I can draw from the money I saved over the years. The unit needs a complete remodel anyhow.

Our association, on the other hand, is have conniptions over the cost of insurance. Our monthly association fees have gone through the roof!

 

[c502cid]

Fire insurance anywhere is the same too. Farmers wont write fire insurance policies in the Colorado mountains.

 

[ripcord]

Government should stay out of it, with the exception of removing barriers to entry into this and any other business.

Exactly. Buying health insurance is mandatory in Switzerland (the gov subsidizes premiums for low income people), but there are over 1500 health insurance companies competing for customers so prices are low.

 

[Vern_in_IL]

When you have a condo in Florida, you are only liable from the walls inward. I opt to have no insurance on my Florida condo. Haven't had insurance for 20 years. Haven't had a mortgage for 20 years. When I first insured the condo 40 years ago, insurance cost $77 per year. Now my neighbor is paying $3400 per year! I'm trying to tell her that self-insuring is an option.

If any disaster happened, I can draw from the money I saved over the years. The unit needs a complete remodel anyhow.

Our association, on the other hand, is have conniptions over the cost of insurance. Our monthly association fees have gone through the roof!

I would like to see reforms in the Insurance field. For one, instead of a deductible, I would like a system where you only pay deductible for the first five years.

Like say a 10k deducible, once you pay insurance bill until that 10k has acumilated, then that 10k is put into a 5-10 year bond, and there on if you have no claim you can cash the bond at maturity and collect the interest... but if you do have a claim after the initial 10k is met, you forfeit your bond to them, in lieu of a claim.

On the Healthcare front many dentist in the area are not accepting our dental plan, cause the prices have gone up, a free cleaning has turned into a 120 dollar bill for the insured. I have no ideal how to fix.

 

[CKN]

Here in Utah we have seen major increases in Home Owners Insurance this year-and have had no reasons for widespread claims. I was able to get my car insurance to go down about $200.00/year.

 

[spackard]

Not really helping things when the homeless have at least 1 fire a week in the LA area that makes the TV news.
In 2021Q1 it was an average of 24 fires per day in the LA area

 

[SC Maintenance]

Government is not the solution. One only need look at the flood plain insurance.

FEMA flood insurance was working pretty good. The hurricane that hit the Jersey short almost bankrupt it. They were charging people $100 a year to insure ocean front property - pure stupidity. There now starting to fix the rebuild stupidity. That would be easy - one sentence - total loss on a 100 or less year floodplain and we will pay out, and that property is no longer insurable. Problem solved.

The problem we have currently is were beholden to the re-insurance industry, which is almost 100% offshore companies. So we outsourced insurance like we outsourced our factories. Neither work for us now. Who would have guessed.

I agree, the deductible of $25K would stop a lot of fraud and lower everyone's rates.

 

[zzyzzx]

I understand that if you even live in a country that has some coastline, even if you are 20 miles inland, you still get hit with higher insurance rates for being "near the coast". This was told to me by someone who lived near Bluffton SC, more than 10 years ago.

 

[Owen Lucas]

I can draw from the money I saved over the years.

Theoretically this would work if you actually put the money into a fund and didn't have any claims for 40 years but when starting out it would be a hard choice. For those willing to take the risk maybe some type of individual investment vehicle designed for self insuring would be an interesting idea.

A broker could whip up some marketing for a "Self Insured Home Protection Fund" where the money you would normally put into insurance would be set aside and invested rather than staying in your general savings account. This is basically what insurance companies do.

 

[SevenBizzos]

My parents are in a fire prone area of CA (not a matter of "if", it's "when") and while their company has been fair (35 years with no claims) his neighbors are getting hit with $20k-$25k/year premium renewals. Not kidding. What are you supposed to do?

95% of any type of insurance payers are going to be a net loss. That's how it works.

 

[alarmguy]

So typical. Here’s where I believe there should be govt oversight. Insurance is notorious for cherry picking and denials and cancellations.

I remember when my dad lived in MA I was surprised he wasn’t shopping for insurance rates on his car. He said it’s all the same, regulated by the commonwealth. And as such? Many carriers didn’t offer insurance in MA as they wanted more.

There was mention lately how poor are treated differently. While people on Medicaid are provided with health benefits, it doesn’t mean that a doctor has to take it. And most places that people with “normal” insurance go, do not accept Medicaid.

There should be a revolution where en masse nobody buys insurance anymore and insurance cos are squeezed.

In my career, I had one claim. A $3000 one on a bmw loaner car 13 years ago. And how long have I had full coverage on cars, home, and my body? That’s six figures of premiums, to pay out $3k. I guess I’m not good with math.

So government is the savior again huh? Force companies to do business where they dont want to. Makes a lot of sense.
I think the old Soviet Union used to do that, didnt work out so well, this is who you are asking to further regulate?

http://usdebtclock.org

I would strongly suggest State Farm regulate the government, not what you suggest and have the government further regulate private business.

You either want to be free or have other people pay your way. If people could not afford to live in CA costs would not be so high and if the day comes that people cant live there, costs will come down. Furthermore you dont have to buy insurance on a home if you can afford it and dont want to. If you cant afford it move to a place one can.

 

[alarmguy]

Free markets can solve this. One idea is a $25k reserve by the insured for claims. The first $25k comes out of the insured pocket. And the insured has two years to replenish the reserve.

With the first $25k coming out of the insured pocket, homeowners insurance rates would collapse.

Government is not the solution. One only need look at the flood plain insurance. Homeowners typically don't move after a loss from flooding, they just rebuild, again and again.

I Agree with your posts, I am a strong believer in free markets. (jsut read my previous posts I here)
Hey, in a free market if insurance costs go so high people cant live there, guess what? Home prices will come down. Forcing companies to insure homes is ridiculous.

Fact is people complain when there is a solution or they move and let someone who can afford it to move in.
I am in one of those areas, 15 minutes or less from the ocean. New home and being near the coast its expensive, compared to my last home almost double the size not near the coast. Insurance is double the cost or more here. So what, it's to be expected but funny thing is, with some determination I mange to slice the cost in half and pay the same as I did in the other home now.

Either way, as free people you can afford it or not that determines market price. If you own your home you dont even need to buy insurance and many people can afford not to buy it. Many owners of beach homes, ocean front homes, even homes on large islands such as Gilgo Beach area are not even (or at one time) insurable, even though they are expensive, there was no fire department out there, you bought cash as no mortgage company would lend. Im not sure since those days if a FD was ever developed.

I am a bit surprised at the low deductibles people are mentioning in here. I see your 25k solution but I am seeing people with 1 to 2k deductibles.
Im not sure why, it's a house, I carry a 5k deductible and to insure a home that is nothing in the mist of things.

 

[researcher]

The BIG question is.. (besides greed, of course) Why is State Farm not writing new policies in California? Do their actuarial tables tell them something BIG and BAD is going to happen there? And they don't want to be having to pay out?? Makes ya wonder..

 

[alarmguy]

My parents are in a fire prone area of CA (not a matter of "if", it's "when") and while their company has been fair (35 years with no claims) his neighbors are getting hit with $20k-$25k/year premium renewals. Not kidding. What are you supposed to do?

95% of any type of insurance payers are going to be a net loss. That's how it works.

Sadly the only solution is move to a more affordable place or drop the insurance on the home. One cant expect others to pay for them to live in fire prone areas right?
Its just life, no guarantees and cant expect others to pay the way.
For many decades people live in areas with no insurance, nor are the properties mortgageable. But some are large expensive beach homes that people buy with cash are in high demand.

 

[John105]

So government is the savior again huh? Force companies to do business where they dont want to. Makes a lot of sense.
I think the old Soviet Union used to do that, didnt work out so well, this is who you are asking to further regulate?

http://usdebtclock.org

I would strongly suggest State Farm regulate the government, not what you suggest and have the government further regulate private business.

You either want to be free or have other people pay your way. If people could not afford to live in CA costs would not be so high and if the day comes that people cant live there, costs will come down. Furthermore you dont have to buy insurance on a home if you can afford it and dont want to. If you cant afford it move to a place one can.

Whaddya think about the govt forcing away the pre-existing conditions clause? And I am directly asking you, with respect to your personal situation. Today, and 35 years from now? It’s ok to get personal. For me, I was against it when I was 20, 30, today, and 30 years from now. Because if the govt hadn’t stepped in, it would have never been remotely fair for what myself and what employer would pay.

Suddenly the Soviet Union is folded in. There was a reason why their red army team was so good and why we rejoiced when we beat them.

 

[alarmguy]

Whaddya think about the govt forcing away the pre-existing conditions clause? And I am directly asking you, with respect to your personal situation? Today, and 35 years from now? It’s ok to get personal. For me, I was against it when I was 20, 30, today, and 30 years from now. Because if the govt hadn’t stepped in, it would have never been remotely fair for what myself and what employer would pay.

Im confused as to your last part of your question but to answer directly, I understood the pre-existing clause, it was to protect people who dutiful paid health insurance their whole lives from people who didnt pay, then once they get sick apply for insurance. I was 100% ok with pre existing clauses because I was always mature enough and responsible to make sure I took care of my family and buy insurance, it made insurance affordable, now you can pay $12000 a year for health insurance for just ONE person because of government intervention to cover for those who are irresponsible.
15 years ago family insurance was dirt cheap on the private market, now you can add another $7000 to the above price tag of $12000. I COULD pick and choose the coverage I wanted and only paid $450 a month for private insurance for my ENTIRE family.

Honestly I think I underestimated the above prices. a close family member of mine in New Jersey now pays $26,400 a YEAR for health insurance, never in her life did she pay so much but ... we can call that the ACA.
This thread is about home insurance though.

 

[John105]

Im confused as to your last part of your question but to answer directly, I understood the pre-existing clause, it was to protect people who dutiful paid health insurance their whole lives from people who didnt pay, then once they get sick apply for insurance. I was 100% ok with it, it made insurance affordable, now you can pay $12000 a year for health insurance because of government intervention for those who are irresponsible. 15 years ago family insurance was dirt cheap on the private market, now you can add another $7000 to the above price tag. I COULD pick and choose the coverage I wanted and only paid $450 a month for private insurance.
This thread is about home insurance though.

All I meant was to say I have a bad heart. I can’t take that higher paying job because if I did, I wouldn’t be covered for 1 1/2 years, DESPITE HAVING COVERAGE AND PAYING FOR IT. So I keep my old job. Everybody knows this makes no sense. But until the govt forced away with that clause, insurance would not do what makes sense.

I feel this is a good example where no matter what you stand for politically, almost all of us will agree the pre existing conditions clause made no sense.

I just think insurance doesn’t play fair and they do need to be forced to act right. If they don’t feel they are being treated right, then leave. But I doubt it’s the case. The case is they can’t afford the margins they want.

 

[JHZR2]

Free markets can solve this. One idea is a $25k reserve by the insured for claims. The first $25k comes out of the insured pocket. And the insured has two years to replenish the reserve.

With the first $25k coming out of the insured pocket, homeowners insurance rates would collapse.

Government is not the solution. One only need look at the flood plain insurance. Homeowners typically don't move after a loss from flooding, they just rebuild, again and again.

How is that going to work when the median income in the USA is like $55k?

For profit insurance is the problem. That doesn’t mean I’m for government insurance necessarily.

Some scenarios make no sense to rebuild, others not so much. In a flood plain? Maybe not such a great idea unless you can self insure. An entire state surrounded by water, with millions of people? That’s a harder scenario.

Thieving contractors don’t help. Nor do actual rising prices.