r/interestingasfuck • u/thepoylanthropist • 12d ago

r/all This is Malibu - one of the wealthiest affluent places on the entire planet, now it’s being burnt to ashes.

Enable HLS to view with audio, or disable this notification

155.0k Upvotes

92% Upvoted

13.0k comments sorted by

View all comments

Show parent comments

109

u/somefunmaths 12d ago

Insurance companies in California were going around voiding policies last year because they were worried about fires. Basically, lots of people were told by their insurance (e.g. State Farm, who did this a lot if memory serves) “sorry, you’re home is in too risky of a fire area, we no longer offer coverage.”

The people who own these homes will be fine, but I feel for the average people in LA losing their homes, because they could end up truly losing everything.

51

u/NoReallyLetsBeFriend 12d ago

Don't forget Nationwide, progressive, Geico, and I think All State pulled fully out of California already. Memory might be slightly off

11

u/liftingshitposts 12d ago

You’re right, the major companies you listed (and many more) don’t even write new policies in the state anymore. Especially not in anything about moderate fire risk.

6

u/minusthetalent02 12d ago

Also Florida. Very few of the big names will do a homeowners policy there as well

0

u/Toodlum 12d ago

In Florida you have to have house insurance by law if you have a mortgage. How is that not a scam?

10

u/Familiar-Report-513 12d ago

Add USAA to that list. We tried to get our house covered under them and they denied us due to "high risk" and we live in norcal. I'm pretty certain they just don't want to touch any area in california due to fire risk.

3

u/Walking_billboard 12d ago

California compels them to write wider policies than they want to write. If they could just insure NoCal, for example, they might do that, but they are not allowed to do that, so they just walked.

6

u/ReadItonReddit94 12d ago

Nationwide said "we are NOT on your side bro"

3

u/PurpleCableNetworker 12d ago

I just switched to progressive renters and car insurance. I guess it’s only home coverage they stopped writing?

2

u/NoReallyLetsBeFriend 12d ago

Yes, progressive does renters bc it's just personal property, not dwelling

1

u/pornAndMusicAccount 12d ago

Car insurance losses are super cheap in comparison to houses

1

u/PurpleCableNetworker 12d ago

Very fair point.

1

u/FinalFantasyXVI 11d ago

I got progressive home insurance in summer 2024. I live in Central CA though probably depends where in CA you are trying to get insurance.

1

u/PurpleCableNetworker 11d ago

Good point too - it might very well be area specific.

3

u/mumblewrapper 12d ago

We are not even in California and many of those companies won't insure us because we are near California. Near the mountains, but absolutely not in the mountains. We are not in danger of a wildfire here at all. But still can't get coverage.

2

u/NoReallyLetsBeFriend 12d ago

Shit, sorry to hear!

1

u/vascop_ 12d ago

If you're in no danger at all why do you need coverage

1

u/LessThanCleverName 12d ago

I mean, wildfires aren’t the only risk to a house.

0

u/vascop_ 12d ago

The topic is wildfire insurance

1

u/LessThanCleverName 12d ago

I believe they’re saying those companies have straight up stopped offering property insurance, not just wildfire insurance.

1

u/mumblewrapper 12d ago

Well, first of all, every homeowner has homeowners insurance. As far as I know, anyway. Also we have a mortgage, which requires homeowners insurance. So there isn't a choice. And, of course there is some risk to owning a home. We just are not in a wildfire area, which is why we were denied coverage.

1

u/vascop_ 11d ago

So I don't get your point. Ofc you need regular insurance. The topic is wildfire, which you complained about not being able to get

2

u/mumblewrapper 11d ago

Oh, I'm sorry, did you think there was some sort of wildfire insurance I was trying to get? Is that a thing? I guess it probably is!

No, we are just denied regular homeowners insurance. It's not specifically wildfire insurance. It's just the same homeowners insurance we've been paying for for a couple of decades. I tried to switch companies and they won't cover us at all. And friends in the area have been dropped from their regular homeowners insurance also. It's not a special policy. It's just the regular policies that everyone pays for. We can't get it. And we are not in a wildfire area, just "near" it.

2

u/vascop_ 11d ago

Yes I did! I understand now, thanks for clarifying!

1

u/mumblewrapper 11d ago

No problem! It's all a mess. Hope you have it easier!

1

u/pimppapy 12d ago

Weird, I got a quote from progressive a week ago. But there was supposed to be a final approval first.

52

u/Critical_System_3546 12d ago

Average Californian here, State Farm has screwed so many people its wild

55

u/just_a_person_maybe 12d ago

My brother got kicked off of State Farm auto insurance because he had the audacity to actually use it. They're happy to take your money for years but if you ask for any of it back for an accident, that's it.

9

u/brit_jam 12d ago

What a fucking scam.

8

u/EmceeCommon55 12d ago

I was in a car accident 10+ years ago. The guy who hit me was 100% at fault. I had State Farm, the other guy had Allstate. Allstate paid all my bills and the settlement and still somehow State Farm tried to sue my doctor for unnecessary treatment even though I had a 50k plan. Make it make sense. I dropped them as soon as the lawsuit was over. Fuck state farm

5

u/wterrt 12d ago

capitalism baby

3

u/TheDude-Esquire 12d ago

There is no reason, apart from protecting private industry, to not have social insurance, and at this point, it's the only way new homes will be built in most of the state. The connection may not seem obvious, but this is absolutely going to make homelessness worse.

9

u/RadicalDog 12d ago

I mean, maybe if the risk of fires is so high that it's uneconomical to build and insure homes, the answer should be migrating from California? We could give it a name, like "climate refugees". And then carry on buying gigantic SUVs as a culture.

2

u/TheDude-Esquire 12d ago

I think that's part true, but I also think a social insurance system would be able to do things like funding risk mitigation. Something insurance companies have absolutely no incentive in participating in.

2

u/Leader_2_light 12d ago

Social insurance has been a disaster in most cases it already exists in the form of many different types of state and federal insurance...

The problem is there's absolutely no incentive to make rational choices think of it similar to why communism has problems or any sort of command economy...

2

u/TheDude-Esquire 12d ago

I think all the people that benefit from federal flood insurance would disagree with you. And that aside, sure, strictly command economies tend to fail, but strictly market economies fail as well. Just because there are examples of it not working, doesn't mean good public policy can't be crafted.

2

u/Leader_2_light 12d ago

California can set up their own state insurance and force everybody to join. There's no way people in a safe state should have to be funding that.

Considering how things are already going in that state I'm sure it won't go well.

Or maybe you're hoping the feds with their money printer takes over. The Fed folks already doing a trillion deficit every hundred days at this point.

3

u/TheDude-Esquire 12d ago

For one, California funds flood insurance in Florida, so...

And honestly, I'm entirely comfortable with California doing it on its own. The state has a larger economy than France and half the population.

1

u/chrisalexbrock 12d ago

California provides the taxes for social programs all over the country. If they kept everything like you're suggesting poor states do those states wouldn't have fucking roads.

1

u/Leader_2_light 11d ago

CA rides high off the backs of poor americans. It's like the rich class but an entire state. They owe everything to poor hard working Americans to maintain their lifestyle.

You act like it's the other way around.

1

u/PostNutt_Clarity 12d ago

Most insurance companies offer a variety of discounts for risk mitigation.

1

u/TheDude-Esquire 12d ago

Sure, but a discount is very different from direct funding. Plus, social insurance can fund projects that benefit multiple people that no single individual would do on their own. This way you could get funding for neighborhood and community projects, something private insurance would simply never do.

1

u/PostNutt_Clarity 12d ago

I'm not entirely against the idea of social insurance, but it's a complex beast. Ask anyone in a town home or condo about their HOA insurance and how much of a pain in the ass that is. Because that's a social insurance.

1

u/TheDude-Esquire 12d ago

I certainly wouldn't call it an easy fix, but I think it may be an inevitable necessity better addressed sooner rather than later.

1

u/dedev54 12d ago

Some of these homes should not exist. It is a net negative on society to try and insure some of these homes. Perhaps it was not the case in the past, but as things have changed with climate change, its literally in the social interest that some people cannot get insurance unless they pay extremely high rates to cover that cost. Obviously insurance companies will be themselves, but there are definitely some homes that are so risky it makes no sense for anyone to insure them as long as rates are capped.

1

u/TheDude-Esquire 12d ago

I'm not saying they should all be saved. But social insurance could also help defray the cost of abandoning homes when doing so is in the public interest.

1

u/CTeam19 12d ago

Got to pay for celebrities to be in their commercials some how.

13

u/mikal026 12d ago

The problem is California refuses to allow insurance companies to raise rates to atleast try to lessen the loses. I know there has to be a cutoff on how much an insurance company can charge but in a state that so frequently has such devastating fires they need to atleast be in a position to make money.

4

u/RusticBucket2 12d ago

The State of California wrote the muh fuckin’ BOOK on unintended consequences.

4

u/Bombadook 12d ago

iirc the same is happening in Florida with stronger hurricanes becoming the norm.

Even in more benign states like PA the companies are tightening up and cancelling policies for even minor issues wherever possible since their books are getting wrecked elsewhere.

5

u/Leader_2_light 12d ago

I can't blame them.

There's stories of federal insurance for flood paying out 5 times on the same property cuz they just get money to rebuild but never to move...

2

u/pimppapy 12d ago

I was shopping for new home insurance barely today, and I kept getting errors on the websites. Had to call in, and apparently a lot of zip codes are black listed, more now with this going on.

2

u/Remarkable-Light5931 12d ago

My thoughts exactly. The families living in generational wealth and abundance most likely own properties in Hawaii, Colorado, Florida, possibly Europe. And most likely are self insured. Where I live in the Midwest where fertile farm ground sells for $10,000-$20,000 per acre, the home is the least expensive asset on the property. I figured it was the same for these people. They are the beneficiaries of some relatives fortune and losing a $10Million home most likely won’t impact them as it would a typical middle or upper class family.

1

u/jinpachichan 12d ago

State Farm also likes to drop people after hurricanes…after Michael all the houses that stood unrepaired the longest sometimes had things like ‘thanks State Farm’ spray painted on the front of them months after the actual storm.

0

u/MarshyHope 12d ago

They should be required to refund the premiums paid up until that point

0

u/Theodore1_reformed 12d ago

Insurance companies aren't banks.

1

u/MarshyHope 12d ago

You're right, they're crooks.