Sarah Blake LaRose (3kitties) wrote,
Sarah Blake LaRose

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hurricanes and insurance industry

Still browsing, just commenting as I find things to read...

From The 100 billion dollar hurricane:

"We haven't seen the worst case scenario by any stretch of the imagination," says Roger Pielke Jr., director of the Center for Science, Technology and Policy Research at the University of Colorado.

The immediate reason is not global warming, although that may have a long-term effect, but a cyclical change in the power and frequency of hurricanes being
generated over the Atlantic Ocean. The idea, put forth in a 2001 paper in Science by Stanley Goldenberg of the National Oceanographic and Atmospheric Association (NOAA), is that the Atlantic goes through decades-long stretches where it churns out extra hurricanes--and equally long lulls where the number of hurricanes is low.

The past few decades--when most of the officials learned how to prepare for and cope with hurricanes--have been one big lull. Says John Molinari, a professor at the State University of New York at Albany, "We were way below normal levels for hurricanes in the 1970s, '80s, and '90s." Now he says, it appears that Goldenberg and his colleagues were right, and that the east coast of the United States is in a period of increased hurricane activity that could last 20 years or more.

The costs of such storms could be huge. Pielke, who has made a career of studying how well society responds to hurricanes, says that if the great Miami hurricane of 1926 were to happen today, it would cost $110 billion in modern dollars. (The practice of giving hurricanes human names didn't begin until 1953.) Such costs are not merely determined by the storm's power, but also by where exactly they hit.

Couple that with the increased amount of development along the world's coastlines, and a pattern of insurers retreating from these areas, and you could see a new age of economic disaster brewing (see: Cursing Katrina).

The referenced article discusses the trend in insurance business to pull out of hurricane-affected areas. What does this mean in the real world? It means you have people who want to rebuild their homes and insurance companies who don't want to cover the cost. Insurance doesn't exist to help people. Insurance is strictly a money-making machine. It's true in health care, and it's true in homeownership. That's something that we as consumers need to get into our minds. It's good for the companies for us to buy the line that they are protecting us: it means we will buy coverage--and hopefully we won't really need it and the company will profit. That's why a person with disabilities or ongoing health care needs can't get health care, and it's why a person living on the coast can't get home insurance for a reasonable rate (assuming it can be gotten at all). Insurance is not our friend--unless we are the company owner. America is not a nice friendly country. America is a look-out-for-number-one country. America is in many ways an extremely selfish country. Certainly many of the people are kind, but on the whole we are a very very selfish society--and we are going to pay for it.

All of these things will affect the rebuilding of New Orleans--and any other city affected by a major hurricane. People are attached to their things, including their homes. For some, losing home will be a wake-up call that causes them to think about what they want out of life. Others will simply expect society to pay for the rebuilding of their million-dollar homes while they criticize the community "welfare bums." Even living without a home won't change their understanding of what it's like to live with little.

Sadly, on some points I have to side with the insurers on this one... If we were running out of land, that would be another story. But we aren't... My feelings on health care are quite different--people don't have a choice about whether or not to get treatment for a medical condition if they intend to live a life with the best health. People do have other living options--I had other living options; and even though I didn't want to leave, I also knew that it was best for my safety.


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