Proposal: Universal flood, earthquake. and hurricane insurance

Industry Observer

The Affordable Care Act hinges its success potential on the requirement that everyone must have health insurance.  The logic behind a broad risk pool is clear.  All Americans, rich, poor, healthy, unhealthy, young and old, must be part of the pool to eventually see more affordable health care costs.  We can argue the way the act was constructed and forced into existence, but the fact remains that there are some foreseeable benefits.

Going a step further, there are other perceived "injustices" in the insurance industry that negatively impact the lives of Americans.  Some specific perils such as floods, hurricanes, earthquakes, avalanches, etc. can be extremely expensive for some homeowners to insure.  Why is flood insurance so expensive?  Simply because only residents of buildings most likely to flood have insurance.  Same is true for earthquakes and hurricanes.  The solution is to get everyone into the pool and make the coverage more affordable.  If we can require a sixty-four old woman to carry maternity insurance, we can certainly require people in North Dakota or Minnesota to have hurricane coverage.  It's only fair.

Most if not all states require auto insurance as a condition of owning a vehicle.  There is little voiced objection to the state mandates.  Granted, there is a bit more choice in the fact that nobody is required to own a car, so technically not all people are required to have auto insurance.  There are some questions arising out of things like no-fault coverage, where ones own insurance may cover an injury, even when riding as a passenger in someone elses vehicle.  Perhaps states may want to consider mandatory limited auto insurance coverage for everyone, even non-auto owners.  That's another topic for another day.

Posted by

 Mike Carlier  Lakeville, MN





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William Feela
Realtor, Whispering Pines Realty 651-674-5999 No.

It is just plain stupid in my opinion. 

AS fo the Auto ins.  I remember when Minnesota required a minimum coverage.  The screaming was heard all over and loud.  I never did see my rates go down because the pool increased.

Oct 30, 2013 02:47 AM #1
Sondra Meyer:
Star View Real Estate - Colorado Springs, CO
See It. Experience It. Live It.

Hmm... I'm not sure what I think on this one. 

Unfortunately, a lot of tenants in commercial buildings that are in flood zones don't purchase flood insurance simply because they can not afford it. 

I've read some stat on the FEMA website that said 20% of flood insurance claims are from people that are not in a floodplain.  Yet, at the same time, cheap flood insurance not deter people from building in flood plains.  If they could get cheap insurance, why would the not build on that gorgeous spot by the lake, river, or ocean? 

I'm not convinced that Obama Care is going to drive down the costs of medical care.  If anything, I think there is a good chance it will go up due to the limited number of doctors that are available.  Supply and demand.....

Nov 12, 2013 12:50 PM #2
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Mike Carlier

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