Should people be forced to buy insurance?

#1
lawgator1

lawgator1

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#1
Quite apart from the tragedy of the flooding in the midwest, there is a town where people didn't think they needed flood insurance because they had levees and now apparently some are complaining that they weren't told they needed it. Some lawmakers appear ready to contemplate requiring such insurance in certain areas.

Insurance not required, FEMA told flooded town - CNN.com

I live in Florida. Here, everyone is told over and over that their homeowners' policy does not cover water damage from rising waters, i.e. from storm surge. It covers a window breaking and water coming in, or roof damages and leaks, but not floods.

The insurer will tell you that you can buy flood insurance. People make their own decisions. Some lenders may require it in flood prone areas.

Not sure I think that the government ought to be in the business of mandating what insurance you buy. Then again, they do mandate certain coverages be included in some type of policies.

Maybe the solution is to require flood coverage in all homeowners' policies? Would be just like every other mandated benefit, and there are tons of them out there.
 
#2
#2
lawgator1 said:
Quite apart from the tragedy of the flooding in the midwest, there is a town where people didn't think they needed flood insurance because they had levees and now apparently some are complaining that they weren't told they needed it. Some lawmakers appear ready to contemplate requiring such insurance in certain areas.

Insurance not required, FEMA told flooded town - CNN.com

I live in Florida. Here, everyone is told over and over that their homeowners' policy does not cover water damage from rising waters, i.e. from storm surge. It covers a window breaking and water coming in, or roof damages and leaks, but not floods.

The insurer will tell you that you can buy flood insurance. People make their own decisions. Some lenders may require it in flood prone areas.

Not sure I think that the government ought to be in the business of mandating what insurance you buy. Then again, they do mandate certain coverages be included in some type of policies.

Maybe the solution is to require flood coverage in all homeowners' policies? Would be just like every other mandated benefit, and there are tons of them out there.
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I am not big into making everyone pay for some peoples coverage. I for one do not need flood coverage. My home sits on top of a ridge about a mile from the Cumberland River/Cheatham Lake. If our house gets flooded we need not worry about rebuilding it, everyone in Nashville along with most of TN would be wiped off the map. We did however buy fire ,earthquake and all other insurance that was a possibility as far as disasters go.
 
#5
#5
One also wonders to what extent the insurance lobby is in favor of this. They don't like the added risk, I'm sure. but they sure don't mind the prospect of government-required premiums.
 
#6
#6
normally i would say no, but since FEMA bails out every idiot that builds on a flood plain, or fire or slide zone, yet doesn't buy insurance, those of us that are responsible are essentially paying for the uninsured. obama would be proud.
 
#7
#7
lawgator1 said:
One also wonders to what extent the insurance lobby is in favor of this. They don't like the added risk, I'm sure. but they sure don't mind the prospect of government-required premiums.
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why wouldn't they? They get to rake in the premiums with limited chance of catastrophic loss, which in the case it does happen, will probably trigger a government bail out. It's win/win for them.
 
#8
#8
No but I shouldn't be forced to pay when they are cheapskates. I'm not in a real danger in my house but still have it because of being very close to the coast.

I feel a better idea would be to buy them all TV's since they obviously missed the whole Katrina thing.
 
#9
#9
crazyguy said:
why wouldn't they? They get to rake in the premiums with limited chance of catastrophic loss, which in the case it does happen, will probably trigger a government bail out. It's win/win for them.
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Yeah, I've always kind of laughed about that. Whenever they have a hurricane down here, they go to the Legislature and get the okay to raise premiums, and that is always approved after some manufactured posturing by the industry and the lawmakers.

In the end, an increase is approved. In essence, they are guaranteed to make a profit. Its a pretty nice scam when you think about it.
 
#10
#10
I think the less government is involved the better. People need to make their own choices. And live with the consequences if they make a bad one. The insurance company should inform the buyer and the buyer make the call. There should be stats available to the buyer about the chances of it happening in his area and if/when it last happened.
 
#11
#11
I agree superdave, but it is a media problem. You get all these pictures on CNN/foxnews and interviews with people who lost their homes and the politicians look like major douches if they don't do SOMETHING. can you imagine if fema didn't bail out katrina victims? the calls of racism just itself would kill any presidents chance of reelection. it's not the polticians money and they wont risk a public backlash by not giving federal aid.
 
#12
#12
crazyguy said:
why wouldn't they? They get to rake in the premiums with limited chance of catastrophic loss, which in the case it does happen, will probably trigger a government bail out. It's win/win for them.
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Not true. They absolutely hate it because they don't want the government mandating where they have to take on risk. Go try to buy insurance in Florida where the FAIR Plan has made it completely unprofitable for companies to do business in the state.
 
#14
#14
Working in a related field I can tell you that flood insurance is required through the lending institutions. If federally insured money is loaned out on a house then it must be established if any improvements on that property are within the FEMA designated SFHA. (Special Flood Hazard Area) If that is the case, flood insurance will be required to close the loan. No insurance, no money. Actually, a lender can require flood insurance even without the presence of a SFHA. Let's face it, most loans use the improvement(s) as part of the collateral so it's the lender's risk not to have flood insurance in place. Where it gets sticky is when property that is NOT stated to be in a SFHA floods anyway and you have a bunch of damage to inunsured property.

Anyway, read up on The Flood-Disaster Protection Act of 1973 and the National Flood Insurance Reform Act of 1994 if you want more info.
 
#15
#15
MG1968 said:
we should have insurance against lawyers and frivolous lawsuits.
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doctor have malpractice insurance but depending on the state you live in, it's so expensive, many doctors have left that state. take for example obgyns, there is a shortage of those doctors in nevada and mississippi because the insurance for malpractice is just too high. not sure if it's change by now
 
#17
#17
joevol320 said:
doctor have malpractice insurance but depending on the state you live in, it's so expensive, many doctors have left that state. take for example obgyns, there is a shortage of those doctors in nevada and mississippi because the insurance for malpractice is just too high. not sure if it's change by now
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100% correct. I have heard most OBGYNs in Mississippi have moved out. I hear the premiums are $250K each year.

As for flood/hurricane insurance, have the government re-insure it.
 
#18
#18
The government should force every one to give their earned money up to redistribution for the collective good.
 
#19
#19
I dont mean it like that... I mean they should do the same with flood/hurricane/terrorits insurance as they do with student loans and home loans. Freddie Mac, Sallie Mae part publicly traded company part governemt.
 
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