Thread

1. sib · 1790706977 · focus · HN ↗

   "Did you know that home insurers use aerial drones to study your rooftop? If the conditions signal neglect, they might cancel your coverage before an accident."

   While there are certainly some issues of concern in the article and the reviewed book, the above seems like exactly what insurance companies should be doing: pricing (or making available) coverage based upon risk.

   This is not much different from an auto insurance company raising your rates (or cancelling coverage) because you've received a number of speeding tickets, which implies increased future risk of loss.

   In fact, I received a letter from my homeowners insurance company a couple years ago stating that they would not renew our coverage due to conditions that they'd observed (clearly from aerial imagery) including overgrown bushes touching the walls of the house and some larger tree branches growing over the house.

   I had a landscaping company come and fix the issues, sent my own drone up to take new pictures, sent the company the pictures, and they agreed to continue coverage. And now my house has less future risk of damage. This seems like a win-win for both of us.

   1. darth_avocado · 1790712042 · focus · HN ↗

      > pricing (or making available) coverage based upon risk.

      The whole point of insurance is to manage risk by spreading it across all consumers. If my insurance rates go up based on my usage or individual risk factors, it’s just an elaborate money making scheme. It should be like “everyone has to pay x to get insurance to get covered and if the claims start going up, everyone has to pay more”.

      1. sib · 1790716233 · focus · HN ↗

         >> The whole point of insurance is to manage risk by spreading it across all consumers.

         Yes, but this does not imply that customers with (potentially vastly) different risk profiles should pay the same rates.

         The canonical example is that 18-year-old single males with previous speeding tickets pay more for auto insurance than married 40-year-old women with clean driving records.

         1. darth_avocado · 1790719173 · focus · HN ↗

            So does that mean the minute you have a cancer diagnosis, the insurance company gets to charge you $20k/month or drop you?

            If the same argument is to be followed why does a person with potentially large medical bills not pay a disproportionately larger premiums than a healthy person?

            1. sib · 1790732367 · focus · HN ↗

               In general, health insurance is not insurance but (frequently subsidized) prepaid medical coverage, exactly because it is not underwritten with respect to risk.

               It's clearly the case that people who are overweight, smoke, or consume alcohol heavily should pay more for health insurance based on massively increased risk of loss.

               Fortunately, other forms of insurance (e.g., homeowners, automobile) are not regulated in this uneconomical fashion.

               1. howard941 · 1790801121 · focus · HN ↗

                  As a practical matter medical underwriting didn't make decisions based on lifestyle, the decisions were made by way of broadly excluding pre-existing conditions. An an example, pre ACA my insurer (whimsically named "Golden Rule Insurance Co") made everything cardiovascular-related excluded from coverage due to very mild hypercholesterolemia.

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