One of my main roles as an investor was trying to assess the difference between what companies said and what they were actually telling you with their actions. Company scripts for investor calls rarely directly answered your questions. I had to read between the lines or listen for what was Continue Reading
The Dangers of Owning A Home In California
I’ve previously written why one should never live in Seattle. The risk of an unprecedented earthquake is too high and you can’t diversify the risk. While California obviously has significant quake risk as well, thankfully, the potential magnitude is less and the tsunami risk is not concerning, so you have Continue Reading
How Man Exacerbates Man Made Climate Change
There are two types of man made climate change. We’re all familiar with one – the impact of human activities on the climate due to rising carbon levels. The second though is often overlooked. It’s how humans take actions that make the effect of a warmer climate worse. When it Continue Reading
Will The FHCF Survive 2023?
Last year, I wrote after Hurricane Ian that the FHCF may collapse due to the size of the loss. While the Fund has not gone bust yet, it is perilously close. What follows is an update on the FHCF’s financial condition, its ability to handle further losses, and a projection Continue Reading
Hurricane Season Begins, The Hard Market Ends
Today is the first day of hurricane season, but it may also mark the last day of a hardening reinsurance market. While market discipline was very impressive in January, it has started to wobble in May. A month ago, I would have said pricing would remain flat to up next Continue Reading
The Case For Dynamic PML Limits, Revisited
The very first topic I wrote about when I launched the blog was catastrophe risk management. In the original post, I made the case that a company’s cat risk tolerance should be a function of market conditions and their capital position, not just a measure of amount at risk such Continue Reading
Why You Shouldn’t Live (Or Sell Insurance) In Seattle
In the early days of the blog, I wrote about why Seattle quake is the scariest and most underestimated cat risk in the US (if not the world). It is a peak zone that isn’t treated like one. If you haven’t read that piece before, I suggest you start there. Continue Reading
This Cat Market Cycle Is Not Like The Others
Reinsurance prices were up ~50% at January 1. While most observers would tell you my hurricane is responsible, I think that’s a myth. What we are now experiencing is a market hardening unlike previous cycles, except one. It is acting like the oil market of last year. What do I Continue Reading
Florida Fails To Avert the Imminent Insurance Crisis
Florida held a special legislative session last week to try to save the homeowner’s insurance market. While they accomplished some positive long term improvements, unfortunately, they did little to address the looming capacity crisis. This means a lot of Floridians are going to find themselves either a) without insurance or Continue Reading
Can The Florida Insurance Debacle Be Solved?
Florida is holding another special legislative session this week to address the failed home insurance market. With FHCF wobbling, the future of many private insurers in the balance, and many residents being priced out of the market, the need for a solution has never been more pressing. Currently, nearly every Continue Reading