Good points!
It is very obvious to actuaries that there is no point in building in flood planes, in areas that are in the paths of hurricanes. Yet local governments want as much revenue and “growth” as possible. Governments encourage the situation.
As people have noticed, there is very little private insurance that provides coverage in the case of hurricane. This is mostly because it is not possible to produce a salable product. If anyone tried to charge for the real expected cost of business interruption coverage for floods in Houston, for example, business owners would laugh, because the premiums were so high.
Some limited flood insurance is sold by the federal government. This is sold at give-away rates, but most buyers still consider the rates too high. With these rates, there continues to be building where it makes no sense to build. The US government has been in good enough shape to provide bailouts in the past. The assumption is that these bailouts will continue forever. They really can’t however, and this may be part of the coming collapse.
Posts
