Speaker 1: From UFOs to psychic powers and government conspiracies. History is
Speaker 1: riddled with unexplained events. You can turn back now or
Speaker 1: learn this stuff they don't want you to know. A
Speaker 1: production of iHeartRadio.
Speaker 2: Hello, welcome back to the show. My name is Matt,
Speaker 2: my name is Noah.
Speaker 3: They call me Ben. We're joined as always with our
Speaker 3: super producer Ball, Mission Control Deck, and most importantly, you
Speaker 3: are you.
Speaker 4: You are here.
Speaker 3: That makes this the stuff they don't want you to know.
Speaker 3: Skirt Skirt. Today's episode is about something a lot of
Speaker 3: people might find boring. It's a peculiar type of product.
Speaker 3: It's something you buy out a necessity instead of for fundsies,
Speaker 3: something that mainly just adults get. It's something everyone worries about.
Speaker 3: And the weird thing is it's one of the it's
Speaker 3: one of the only things that the more you use it,
Speaker 3: every single time you use this thing that you paid for,
Speaker 3: it gets more expensive.
Speaker 4: Oh I know, this one's from the Lord of the Rings.
Speaker 4: This is a Gollum riddle.
Speaker 5: It's the wind, It's time Wait, it's a timeshare silence,
Speaker 5: It's it's.
Speaker 4: It's a million.
Speaker 3: Nelson's on the road again. Uh yeah, it's you nailed
Speaker 3: it No, uh sort of, it's it is. It's like
Speaker 3: a ridiculous situation because it does feel like a riddle,
Speaker 3: doesn't it? Like how the hell could this one thing
Speaker 3: have all these attributes we described? Who wants to do it?
Speaker 3: For anybody who hasn't read the title? What are we
Speaker 3: talking about?
Speaker 2: Insurance? But specifically insurance for your your stuff, your house.
Speaker 5: Your house and all the stuff contained within it. Yeah,
Speaker 5: around it, you know, out out buildings, whatever, you know,
Speaker 5: all that.
Speaker 2: Stuff any one that happens to come on to your property.
Speaker 3: Right yes, now in most cases that is, that is true.
Speaker 3: But I mean think about how weird that is. Like
Speaker 3: these are cold open I want to go too long.
Speaker 3: But you know, if you went to a shoe store,
Speaker 3: you bought a pair of shoes, you wore out the
Speaker 3: shoes over time, you went back to the shoe store
Speaker 3: and they said beat me here, Paul, They said, hey,
Speaker 3: you buddy, now your next pair is twice as expensive.
Speaker 3: You would never go to that shoe store again. But
Speaker 3: that's exactly how home insurance works.
Speaker 4: Right. I wish I.
Speaker 2: Could do they sell shoe insurance. I would do that.
Speaker 5: It's technically covered. It's technically covered if it's in your closet.
Speaker 3: That's why you park your car and a house during
Speaker 3: a storm.
Speaker 5: We'll get to it in a bit, but Ben, I
Speaker 5: think that metaphor, I guess is more appropriate than you
Speaker 5: might even think the idea of, like dang, well, if
Speaker 5: that were the case, I guess I'd never wear those shoes,
Speaker 5: would I?
Speaker 3: So home insurance in particular, this is going to strike
Speaker 3: a chord with a lot of us listening tonight. There
Speaker 3: is a storm on the way, both metaphorically and literally, and.
Speaker 2: We'll take a ride on that storm when we get
Speaker 2: back from a word from our sponsor.
Speaker 3: Here are the facts writers on the storm. What is
Speaker 3: home insurance?
Speaker 4: We described it.
Speaker 3: It's a sub category of property insurance, and you guys
Speaker 3: nailed it because full disclosure. You know, homeownership can be
Speaker 3: tough for a lot of people in our generation and younger,
Speaker 3: especially these days. And some of us are homeowners. In
Speaker 3: the audience tonight, many and some of our hosts rough homeowners.
Speaker 3: And it's kind of pain in the butt, but it
Speaker 3: does make sense, right, Like you know, a small a
Speaker 3: small mistake can be very expensive, very quickly.
Speaker 2: It can. It can be devastating too, especially if it's
Speaker 2: not even a mistake if it's an act of God
Speaker 2: or nature or the universe, however you want to think
Speaker 2: about it.
Speaker 3: Yeah, we've known each other for a while, and you guys,
Speaker 3: I've both been homeowners at various times, and when we're
Speaker 3: just hanging out or chatting before after a show or
Speaker 3: even not work related, we hit on some of the
Speaker 3: same things. For most people in the US, if you
Speaker 3: were a homeowner, your home is your largest financial asset.
Speaker 3: That's simply the stats, and repairs are inevitable over time.
Speaker 3: Your water heater goes out, I'm like, I'm trying not
Speaker 3: to point fingers at this one, but I remember, yeah,
Speaker 3: Matt's Okay, can I say it. Matt's water heater went.
Speaker 3: It was a whole.
Speaker 2: It didn't go out, it started leaking, and I didn't
Speaker 2: know it was leaking, and it leaked water in black
Speaker 2: nastiness all over my floor and into my crawl space,
Speaker 2: and I didn't discover until way too late, And thankfully
Speaker 2: I had some pretty good homeowners insurance.
Speaker 4: You know.
Speaker 5: As funny as I moved in to this place and
Speaker 5: almost immediately my sump pump, which is another expensive piece
Speaker 5: of equipment, just basically exploded and just leaked foul you know,
Speaker 5: poop water. Basically a some pop if anyone doesn't know,
Speaker 5: is a thing that you know, pumps the stuff from
Speaker 5: a downstairs bathroom or drain or whatever, like I've got
Speaker 5: laundry stuff in the basement to the upstairs where it
Speaker 5: then goes out, you know, and drains with the rest
Speaker 5: of the stuff from the house. I tried to make
Speaker 5: a claim for this and it was denied, so I
Speaker 5: just paid for it out of pocket, and it kind
Speaker 5: of established a pattern for me where rather than filing
Speaker 5: an insurance claim anytime something goes wrong up to a
Speaker 5: certain point it's like catastrophic and I couldn't afford it,
Speaker 5: I just paid for it myself and then take a
Speaker 5: tax right off, because you could take a tax right
Speaker 5: off for improvements to your house. And it's a lot
Speaker 5: easier to do that than it is to contend with
Speaker 5: the insurance companies because it's a lot of stuff that
Speaker 5: you have to file, a lot of you know, boxes
Speaker 5: you have to tick, and chances are you're gonna get denied.
Speaker 3: And there's a lot of waiting and do you have
Speaker 3: to always remember, look, we've got a private insurance is
Speaker 3: a huge employer in the US. We're not attacking the individuals.
Speaker 3: We are describing some problems with a broken system. One
Speaker 3: of the questions I had in another life when I
Speaker 3: worked in what you could call insurance, was who do
Speaker 3: the adjusters serve? Yeah, it's not you, that's the company, right,
Speaker 3: I mean water, heater roof replacements, which inevitably happen over time.
Speaker 3: Not to mention like you were describing Matt so called
Speaker 3: acts of God, natural disasters, bad weather, even non catastrophic
Speaker 3: bad weather like falling trees, flooding, vandalism, a thousand other things.
Speaker 3: It's tough for a lot of people to have that
Speaker 3: much liquidity, that much cash in hand with a snap
Speaker 3: of their fingers. And that's where insurance comes in.
Speaker 5: And you know, and like the afore mentioned sump pump situation,
Speaker 5: that's a two thousand dollars replacement, which is right on
Speaker 5: the edge of what.
Speaker 4: I could afford to pay out of pop.
Speaker 5: And rather than deal with it, you know, it can
Speaker 5: can test the denial of the of the of the claim.
Speaker 5: I just went ahead and dealt with it and ate it.
Speaker 5: And then again you can like get that back in
Speaker 5: the form of a tax ride off at the end
Speaker 5: of the year, so it does kind of balance out,
Speaker 5: But it really makes me think about how insurance isn't
Speaker 5: really you can't just feel. They say insurance is selling
Speaker 5: piece of mind, but I don't buy that. I don't
Speaker 5: think it gives me any piece of mind at all.
Speaker 5: Maybe for like a catastrophic thing like you're talking about,
Speaker 5: being like a tree falling on your house or an
Speaker 5: active god, but even that piece of mind is just
Speaker 5: somewhere down the line. Maybe you'll get some money back
Speaker 5: and you'll get some coverage for what you've paid into
Speaker 5: that system. And I guess we should really quickly to
Speaker 5: summarize a couple of the different types of insurance that
Speaker 5: apply to homeowners here.
Speaker 3: Yeah, and a big part of this is the window
Speaker 3: of time. It's something you've been familiar with if you've
Speaker 3: ever worked freelance, and invoice can take as long as
Speaker 3: ninety days, but all your other living expense is don't
Speaker 3: pause for ninety days.
Speaker 5: And while you might get reimbursed for some of that,
Speaker 5: it's not going to happen immediately.
Speaker 3: So often there's new Often people don't have the wherewithal
Speaker 3: to wait a full year right for that advantage and
Speaker 3: I love that you point out types of homeowner insurance
Speaker 3: so the industry calls it HOI. There's actual cash value
Speaker 3: policy that factors in depreciation, inflation, all that stuff. So
Speaker 3: like if you have an old water heater, then you
Speaker 3: get paid some percentage of that original cost. Then there's
Speaker 3: a replacement cost policy just says hey, if your water
Speaker 3: heater goes out, then you get a new one that
Speaker 3: is about the same for this current era or this
Speaker 3: current year or whatever. You also have to get different
Speaker 3: types of coverage for your home right Like when Hurricane
Speaker 3: Katrina hit, a lot of people found their insurance claims
Speaker 3: denied because they didn't explicitly have have protection for floods
Speaker 3: or flooding, which is just the terrible thing to hear.
Speaker 3: You've got to assume that anything in your policy that
Speaker 3: is not specifically covered may not be covered at all.
Speaker 5: Well, and a lot of that stuff's buried in the
Speaker 5: fine print. And we're not lawyers, we don't always know
Speaker 5: exactly what we there's a certain assumption that these organizations
Speaker 5: are there to help you out and we're not here
Speaker 5: to completely malign the insurance you know industry a little bit,
Speaker 5: but I mean, you know, there is an expectation of like, well,
Speaker 5: surely they tell me if I need that, but no,
Speaker 5: they surely will not.
Speaker 2: Well and as an individual, add ons to insurance like
Speaker 2: flood protection, specific types of fire protection or whatever, you know,
Speaker 2: that fine print stuff that can be so cost prohibitive
Speaker 2: when you're looking at different home insurance policies and when
Speaker 2: you're already especially if you're in the process of buying
Speaker 2: a home, which is a laborantine thing that your mind
Speaker 2: has to navigate through, hopefully with the help of somebody
Speaker 2: that kind of knows what they're doing. When you get
Speaker 2: to the home insurance part of that, it is it
Speaker 2: reminds me of the funeral game a little bit, where
Speaker 2: you're you're already kind of broken down, You're pretty vulnerable
Speaker 2: in that state already, and you just kind of want
Speaker 2: to get it done. And you also you almost all,
Speaker 2: I don't know in my in my experience, you go
Speaker 2: for the minimum, like, Okay, I think I'll be okay
Speaker 2: with this because it's it's expensive no matter where you are, and.
Speaker 5: At that point, you're just trying to get your monthly
Speaker 5: payment down because you know, typically it gets factored into
Speaker 5: your monthly payment, and most people can't afford to pay
Speaker 5: that full premium in one fell swoop, so you factor
Speaker 5: it into escrow or whatever. Where you're it adds a
Speaker 5: couple hundred dollars a month, and you're already house poor
Speaker 5: from making a massive down payment, so you want that
Speaker 5: monthly payment to be as low as possible.
Speaker 4: Therefore, you're much you're willing to overlook.
Speaker 5: Well, surely I don't need the the volcano insurance, right,
Speaker 5: there's no man, I mean, there's no active volcanoes near
Speaker 5: my house.
Speaker 4: Right.
Speaker 3: Most people listening tonight do not have a Honda Odyssey
Speaker 3: add on to their home insurance policy, and that leads to.
Speaker 4: Things ascess though you probably should.
Speaker 3: Yeah, just look at the stats. But then also, you know,
Speaker 3: I'd love that you mentioned Escro account without getting two
Speaker 3: in the weeds. For most homeowners, you're going to have
Speaker 3: a mortgage, and your mortgage and these associated costs like
Speaker 3: homeowners insurance that goes into an Escro account that your
Speaker 3: lender pays all the stuff out through that through that account. Look,
Speaker 3: there are a lot of people, you know, to that's
Speaker 3: point about having the lowest possible denominator or the bare minimum.
Speaker 3: There are people who would prefer to have no insurance whatsoever.
Speaker 3: You know, they're like, I don't have a case on
Speaker 3: my iPhone. I live, you know, by the code of God, playing.
Speaker 2: Dice, dude. But see, I always thought Ben that it
Speaker 2: was a requirement for like for I thought, just if
Speaker 2: you own a home, you have to have homeowners insurance.
Speaker 2: The way if you have a vehicle and you want
Speaker 2: to drive with a driver's license, have to have auto insurance.
Speaker 5: Well, but the only requirement is for the bank. The
Speaker 5: bank is protecting their investments. You don't have to have
Speaker 5: it if you own your house out right. I don't
Speaker 5: believe you do have to have it. It might very state
Speaker 5: in the state, but okay, you do not.
Speaker 3: There is no in the United States. There is no
Speaker 3: state nor federal there's neither state nor federal law requiring
Speaker 3: you to have homeowners insurance. But if you have a mortgage,
Speaker 3: you don't totally own your home yet, so the banks
Speaker 3: or the lenders will require you to get that insurance
Speaker 3: as part of the deal. And that's all, like you
Speaker 3: guys said, that's all so that the bank can be
Speaker 3: made whole if your home is destroyed or if something
Speaker 3: bad happens. All right, folks stap in our fingers.
Speaker 4: Wake up. That's it.
Speaker 3: That's all the background getting to the other stuff. You
Speaker 3: need to know this, and please do send us your
Speaker 3: home insurance war stories as well. The price you pay
Speaker 3: here's why this is on a conspiracy show. The price
Speaker 3: you pay for home insurance depends upon where you live.
Speaker 3: And now, to steal the line for Fox News, more
Speaker 3: than ever, those prices are changing. They are not going down.
Speaker 3: Everything shows us that the strangeness dare we say a
Speaker 3: bit of conspiracy here, is only going to accelerate. It's
Speaker 3: only going to get worse, and much sooner than we
Speaker 3: would all perhaps like to think.
Speaker 4: So let's put a pit on that.
Speaker 5: Think about that for a second, only take a quick
Speaker 5: ad break, and then we'll come back and get right
Speaker 5: into the weeds, but not too weedy.
Speaker 3: Here's where it gets crazy. It's been an open secret
Speaker 3: in the industry for years. Costly climate catastrophes have driven
Speaker 3: up the cost of home insurance across the United States,
Speaker 3: specifically in certain areas, and in some of those areas,
Speaker 3: they've driven these insurance companies out of the market completely.
Speaker 3: The industry already has a euphemism for this. These moves
Speaker 3: are called insurance corrections.
Speaker 5: Mmmm.
Speaker 2: Wherever we heard that before? That time correction? Yeah.
Speaker 5: Stock I mean it's the same thing, dude. It's currency,
Speaker 5: it really is, and there's a market for it, and
Speaker 5: it's based on conditions, you know, much like the stock
Speaker 5: market is, and sometimes things are underassessed and or their
Speaker 5: speculation that has.
Speaker 4: To do with certain weather events. It's all predictive.
Speaker 5: It's like betting on futures in the stock market. It's
Speaker 5: very interesting that that same term is used, but I
Speaker 5: think very appropriate.
Speaker 2: Well, lest we forget Ben already said this in the episode,
Speaker 2: these are for profit companies every time, no matter what,
Speaker 2: they are for profit. And if they can't make more
Speaker 2: money with you paying them every month for nothing happening,
Speaker 2: then they're having to shell out because stuff's actually happening.
Speaker 2: Then the there's no business.
Speaker 4: Yeah.
Speaker 3: And in June of twenty twenty three, sixty million Americans
Speaker 3: in just California and Florida found themselves scrambling for protection
Speaker 3: because they would imagine this. You buy a house and
Speaker 3: your bank says, okay, congratulations, you're in the homeownership class.
Speaker 3: Welcome to Florida, California. You need to get homeowners insurance
Speaker 3: until you're done with your mortgage and you can't find
Speaker 3: a company that will give you a policy, or even worse,
Speaker 3: you've lived in California, you've lived in Florida for a
Speaker 3: number of years, you still have your mortgage, and you
Speaker 3: get a you get that annual letter from your insurance
Speaker 3: company and they say, hey, we're not going to renew
Speaker 3: your coverage. You had a good run. Go try someone else,
Speaker 3: but not Farmers, cause we're we're getting out of dodge.
Speaker 2: Like that's nuts. And there are also stories of people
Speaker 2: being handed a what like a forty percent increase or
Speaker 2: or even way higher than that.
Speaker 4: Eighty.
Speaker 2: I think I didn't I didn't see eighty. But I
Speaker 2: think you're we're talking where all of a sudden you're
Speaker 2: gonna just renew your homeowner's insurance and now it's it's skyrockets,
Speaker 2: and you realize, oh wait, I actually can't afford that.
Speaker 2: What do you do?
Speaker 3: Yeah, it's not better either, You're not paying more for
Speaker 3: something better.
Speaker 5: Well, no, And and I think I maybe have mentioned
Speaker 5: in the past that I had a bit of a conundrum,
Speaker 5: and I'll get to what ultimately the resolution that was
Speaker 5: a little later. But my homeowner's insurance policy was canceled
Speaker 5: because I didn't receive or acknowledge some notification that probably
Speaker 5: came in the US mail. And again, I mean, it's
Speaker 5: my own fault and consider it, like chalk it up
Speaker 5: to an experience as a you know, relatively new homeowner.
Speaker 5: But you have to interact with them because the terms
Speaker 5: can change, because if you don't like acknowledge the terms
Speaker 5: of change, then they cancel it. So I mean, maybe
Speaker 5: I'm misunderstanding the way that works, but that's my understanding
Speaker 5: is that because I didn't reach out with this renewal period,
Speaker 5: they just canceled it, you know, unilaterally. And then my
Speaker 5: mortgage company took it upon themselves because it's a term
Speaker 5: of my mortgage to have homeowners insurance, and they signed
Speaker 5: me up for a policy of their choosing that was
Speaker 5: a good four hundred dollars extra a month and I
Speaker 5: just like totally ate that for way too long because
Speaker 5: I was just so frustrated with the whole process.
Speaker 3: Yeah, and that's unfortunately a very common story for a
Speaker 3: lot of people, even before these climate crises started driving
Speaker 3: people literally out of house and home. And in defense
Speaker 3: of these insurance companies, you know, getting mad at them
Speaker 3: for being for profit is kind of like getting mad
Speaker 3: at dogs for barking and pooping. It's part of what
Speaker 3: they do. It's arguably why they're around.
Speaker 2: It's how the system works. It's it's why they will
Speaker 2: cover when your entire roof blows off during tornado, because
Speaker 2: there are enough other people also paying for that tornado
Speaker 2: insurance and it's expensive.
Speaker 3: Yeah, and it's all a numbers game, you know. Some
Speaker 3: of the most I think some of the most high
Speaker 3: up intellectual mathematicians are underwriters. They're the ones who figure
Speaker 3: out how much your premium is. A premium is just
Speaker 3: sort of the dumb word the industry uses for those
Speaker 3: payments you make monthly or annually or bi monthly or whatever.
Speaker 3: They don't want to turn people away if they can
Speaker 3: help it, because that's their business model. They need customers,
Speaker 3: so they don't want to say no, but sometimes for
Speaker 3: their own survival as a company, they do have to
Speaker 3: say no. The numbers. It all goes back to the numbers.
Speaker 3: The numbers are inarguable. Maybe we talk a little bit
Speaker 3: about just how crazy things have gotten in California and Florida.
Speaker 4: Correct.
Speaker 5: In California, there were eight disaster events from twenty twenty
Speaker 5: to twenty twenty four that caused between twenty billion with
Speaker 5: a B and fifty billion in damages can buy. I
Speaker 5: think wildfires, y'all think of like total loss of property
Speaker 5: in like Malibu. For example, a good friend of ours,
Speaker 5: I'll just keep them private, but a very close friend
Speaker 5: and colleague of ours had a family member who entirely
Speaker 5: lost their home in Malibu that they'd lived in, you know,
Speaker 5: for I don't want to say a generation, if not longer.
Speaker 5: And that is a common story, you know. Yeah, you're
Speaker 5: running a little bit of a risk living in California,
Speaker 5: a place where wildfires thrive like that and their rock
Speaker 5: slides and things like that and erosion. Certainly, so that
Speaker 5: makes sense that it would maybe cost a little more
Speaker 5: because the damages and potential events are much likelihood is
Speaker 5: a little higher there, but still in Florida. On the
Speaker 5: other hand, thirty severe storms or hurricanes from twenty twenty
Speaker 5: to twenty twenty four caused between one hundred billion and
Speaker 5: two hundred billion dollars in damage.
Speaker 4: One of these, of course, was.
Speaker 5: Hurricane Ian, the third most just catastrophic costly storm in
Speaker 5: United States history so far, and again, this a lot
Speaker 5: of this has to do with the fact that these
Speaker 5: things are becoming more and more common because of climate change.
Speaker 3: And this is coming from our good friends at NOAH.
Speaker 3: So this is a nonpartisan, non political source. This is
Speaker 3: just a bunch of boffins and eggheads.
Speaker 2: And that's the National Oceanic and Atmospheric Administration. And this
Speaker 2: is just one extra thing.
Speaker 4: Be guys.
Speaker 2: I want to throw Texas in here too, because I
Speaker 2: found some interesting stuff on them. And as we were
Speaker 2: going through the research, I kept thinking back to twenty
Speaker 2: twenty one. Do you guys remember when there was a
Speaker 2: big storm in twenty twenty one and power was out
Speaker 2: for a long long time. I think it was Ury
Speaker 2: was like a winter storm Ury, and the Texas grid
Speaker 2: failed basically and there was like it was only I
Speaker 2: think it was ten billion dollars worth in losses like
Speaker 2: insurance losses for that one storm across all of Texas.
Speaker 2: And if you look at the numbers again from NOAH
Speaker 2: with Texas, there are an average of four natural disasters
Speaker 2: in that state that occur every year, but between twenty
Speaker 2: nineteen and twenty twenty three they suffered an average of
Speaker 2: eleven over one billion dollar events every year. Like that's
Speaker 2: imagine as a state shelling out eleven billion dollars a
Speaker 2: year knowingly because of natural disasters, and then as an
Speaker 2: insurance company, you know that you've got all of these
Speaker 2: people that you now have to serve to repair all
Speaker 2: of these homes. I don't know that. It just seems
Speaker 2: unsustainable to me.
Speaker 3: It reminds me how recently we encountered the hottest day
Speaker 3: ever recorded on Earth. It was a Sunday in July,
Speaker 3: and it was only the hottest day ever for about
Speaker 3: twenty four hours because the next day was hotter. So
Speaker 3: the two hottest days on the planet, number one and
Speaker 3: number two, happened consecutively this year, which shows us the
Speaker 3: pattern is escalating. It's untenable, as many people in California,
Speaker 3: Texas and Florida can agree even just looking at their
Speaker 3: home insurance bills. You know what I mean, Like, no
Speaker 3: matter what your political ideology is, the money moves and
Speaker 3: you can tell what the mathematicians are thinking by looking
Speaker 3: at the bill.
Speaker 2: Well, yeah, and all they have to do is pay
Speaker 2: a little bit of attention and go, oh, we guys,
Speaker 2: we need to raise our rates by a lot. And
Speaker 2: when I say a lot, I mean a lot.
Speaker 4: Yeah.
Speaker 3: Twenty twenty three, the average homeowner insurance premium then Florida
Speaker 3: is six thousand dollars a year, not thick thousand dollars.
Speaker 3: That would be.
Speaker 2: Fair, Robin, thick thousand dollars dollars.
Speaker 3: I mean, but that's that's way above average right in
Speaker 3: the US. I mean, it's definitely higher than Georgia.
Speaker 4: Correct.
Speaker 2: Yeah, think about that being the average. That means some
Speaker 2: people are paying way more than that.
Speaker 4: Right, Yeah.
Speaker 3: And then just this year twenty twenty four, the average
Speaker 3: went up two thousand, seven hundred and seventy dollars. The
Speaker 3: average home insurance in Florida now is eight thousand, seven
Speaker 3: hundred and seventy dollars a year, and it'll probably be
Speaker 3: higher in twenty twenty five.
Speaker 2: Yeah, it'll have to be until it just goes away
Speaker 2: in twenty twenty eight. I'm just joking Florida, I mean,
Speaker 2: not homeowners and sure, okay, let me you know.
Speaker 5: Says by everybody remembers that tool song about sea you
Speaker 5: down in Arizona Bay. I mean, Florida and California are
Speaker 5: two of these locations that they're beautiful and they are
Speaker 5: lovely places to live but there are some somewhat apocalyptic future,
Speaker 5: you know, kind of doom saying things associated with them.
Speaker 3: One hundred percent one hundred percent. And you know, as
Speaker 3: more and more private companies exit these areas, more and
Speaker 3: more people enter state run alternatives. Kind of like how
Speaker 3: if you can't afford private medical insurance, you may have
Speaker 3: you may live in a part of the country that
Speaker 3: allows you to participate in a government plan. And California
Speaker 3: has something called the Fair Plan Association. Florida has something
Speaker 3: called the Citizens Property Insurance Corporation, And as of just
Speaker 3: last year, that Florida state run company alone held the
Speaker 3: homeowner policies for one out of eight of every household
Speaker 3: in Florida.
Speaker 2: That's a lot more than I would have expected. But
Speaker 2: it does make sense, man, watching just watching the news,
Speaker 2: watching the weather recently, especially when you see the kind
Speaker 2: of storm that we just had. And I can't tell
Speaker 2: you the name of it because I'm I didn't keep
Speaker 2: up that well with it. But the storm that formed
Speaker 2: in the Atlantic pretty swiftly became a hurricane and then
Speaker 2: swept across and then went all the way up the
Speaker 2: eastern seaboard of the US, and people from Florida all
Speaker 2: the way up to Upstate New York got flooding, like
Speaker 2: terrible flooding. When that kind of thing is feeling more
Speaker 2: and more like a regular occurrence, it's not good. It's
Speaker 2: not good for anybody who's gonna have to pay homeowners
Speaker 2: insurance agreed.
Speaker 3: Yeah, and it's not good for the companies either. I mean,
Speaker 3: there are it's such a headline. It's such red meat
Speaker 3: for a headline, right to divide people or to alarm people,
Speaker 3: to say climate change is pushing home insurance. But there
Speaker 3: are other factors at play. The story is not as
Speaker 3: simple as headlines might imply. So one of the big
Speaker 3: things that people hadn't thought about. I don't know if
Speaker 3: we all thought about this as well before we started
Speaker 3: researching is the role the pandemic played, But maybe not
Speaker 3: in the way we think. There was a great interview
Speaker 3: with a guy named David Blades, which first off, is
Speaker 3: a really cool name.
Speaker 4: Like a magician or something. I mean game.
Speaker 2: He's like a he's a bouncer.
Speaker 3: I picture of talking. Yeah, I picture he's like specializes
Speaker 3: in knives and butterfly knives and switchblades. So he's talking
Speaker 3: to NBC. Yeah, he's talking to NBC, and he's just
Speaker 3: like he's got his hand on a desk and he's
Speaker 3: popping the knife in between his spread out fingers or something.
Speaker 3: But he he said that we need to look at
Speaker 3: us construction cost because before the pandemic, from twenty sixteen
Speaker 3: to twenty twenty, those costs increase between like one and
Speaker 3: three percent, which seemed very reasonable, moderate what you could expect.
Speaker 3: But let's give the let's give a quote directly from
Speaker 3: David Leads.
Speaker 2: Okay, this is a direct quote, and I'm just gonna
Speaker 2: put this here because I think I accidentally made a
Speaker 2: skip over his actual credits. He's the associate director for
Speaker 2: Industry Research and Analytics at am Best, which is a
Speaker 2: global credit agency in data group. Okay, so he said,
Speaker 2: with this increase, you're talking about a very moderate amount
Speaker 2: of inflation. He says, Yet during and after the pandemic,
Speaker 2: supply chains were disrupted, real estate prices skyrocketed, and interest
Speaker 2: rates surged. As a result, construction costs soared thirteen point
Speaker 2: four percent in twenty twenty one and nine point three
Speaker 2: percent the year after. So combine that's twenty two point
Speaker 2: seven percent. I think, if I'm doing my math correctly,
Speaker 2: I may not be, but that amount of construction cost
Speaker 2: increase is that makes so much sense?
Speaker 4: Ben?
Speaker 2: Why why would construction costs increase homeowners insurance?
Speaker 3: Ooh yeah, that's or Dennis Reynolds moment. That's the thing
Speaker 3: where like we haven't thought about that. When construction costs rise,
Speaker 3: so does the cost of literally any repair. So a
Speaker 3: home prices surge in the beginning, but then anytime you know,
Speaker 3: the water heater breaks, anytime you've got to replace the roof,
Speaker 3: anytime a Honda Odyssey hits the side of your house,
Speaker 3: it's going to cost at least twenty something percent more.
Speaker 3: And this means that the insurance companies have to start
Speaker 3: jacking up their rates to a certain threshold. But they
Speaker 3: don't have infinite tolerance. At a certain point, they have
Speaker 3: to ask themselves, well, it's not just a matter of
Speaker 3: whether or not we can turn a profit here, but
Speaker 3: can we act? Can we literally afford to do business
Speaker 3: at all in these areas where we know hurricanes are
Speaker 3: not a possibility but a certitude, you know, a certainty.
Speaker 2: Too, that is that is indeed nuts. And I'm just
Speaker 2: gonna take it really quickly to my water heater situation
Speaker 2: because that was right in pandemic times, and that's when
Speaker 2: construction costs were going way up because the prices of
Speaker 2: wood were going way up, and they had to replace
Speaker 2: quite a bit of wood in the floor of my house,
Speaker 2: and it costs them way more than they expected the
Speaker 2: insurance company to even do the job. So I ended
Speaker 2: up having to I don't even know how I navigated it,
Speaker 2: but I had to pay extra money basically at that
Speaker 2: time because of my deductible or whatever it was I had,
Speaker 2: plus some other thing and I can't even remember, but
Speaker 2: it was. It was because of those construction costs.
Speaker 5: And the interesting thing too, is, like I think, I
Speaker 5: see you guys are linked to this YouTube video on
Speaker 5: building integrity, just a YouTube channel, and the guy that
Speaker 5: I think runs that, he's like a consultant in cases
Speaker 5: of insurance fraud, but you know, in terms of fraud
Speaker 5: perpetrated by insurance companies. And one thing this dude pointed
Speaker 5: out that I definitely verified is relatively common. Is this
Speaker 5: idea that you know, since these are for profit organizations,
Speaker 5: their money that they receive that are profits, they don't
Speaker 5: necessarily even have to like put those aside in the
Speaker 5: hopes that you know, like this is this is held
Speaker 5: for you right where it's not like the same as escrower.
Speaker 5: That's money that you pay through your mortgage company they
Speaker 5: hold on to for you, and that then is you.
Speaker 5: So the money that you pay your insurance company, they're
Speaker 5: not like tucking that away. And there could come a
Speaker 5: time where maybe so many claims are coming through that
Speaker 5: the insurance company isn't profitable that year, but they only
Speaker 5: apparently have to like balance the books in years where
Speaker 5: they don't make their bottom line. So it's just a
Speaker 5: really interesting balancing act because of this whole for profit
Speaker 5: nature of it, and the fact of the matter is
Speaker 5: it really just isn't designed to protect you. And there
Speaker 5: were all these video clips I was watching of like
Speaker 5: insurance adjusters coming out and hanging out with a roofer
Speaker 5: who shown them that this roof needs to be replaced
Speaker 5: by ripping out these shingles seeing see look the nail
Speaker 5: holes here is all warm, and the insurance just is like, no,
Speaker 5: you're being too aggressive with that. That's not how you
Speaker 5: do that. You don't pull it, you don't rip the
Speaker 5: nail out like that. You're not even trying.
Speaker 2: Guy.
Speaker 5: He's basically telling this professional roofer that he is not
Speaker 5: approaching this with the desire to repair. Is he is
Speaker 5: basically saying, you already have your mind made up. But
Speaker 5: what the reality is is that the insurance just already
Speaker 5: has his mind made up as to the fact that
Speaker 5: this we will not repare replace this roof, even if
Speaker 5: it's within the timeframe of when a roof should be replaced,
Speaker 5: which is I think twenty five years or something like that.
Speaker 5: And it's just fascinating because the point that the guy
Speaker 5: on the YouTube channel made is that you could argue that, well,
Speaker 5: they knew how old the roof was when they insured
Speaker 5: the house, and if they weren't going to replace it
Speaker 5: due to this storm damage, then that was what this
Speaker 5: was relating to. Then they shouldn't have insured it in
Speaker 5: the first place. But the fact is, when people in
Speaker 5: sure you're home, they ask very vague questions. They want
Speaker 5: that plausible deniability, right, They don't want to know everything
Speaker 5: that's wrong with the house. That way, when something really
Speaker 5: does go wrong, they can say, well, I wasn't really
Speaker 5: covering of the terms of our agreement.
Speaker 3: Could you describe your foundation in terms of vibes?
Speaker 4: It really is that way more or less, because like
Speaker 4: you know they ask you, these guys.
Speaker 5: I literally applied for a new policy today because of
Speaker 5: that issue I was talking about. I finally dealt with it,
Speaker 5: and they're like, how old did your roof? I'm like, oh,
Speaker 5: I could look it up. It and I just give
Speaker 5: us a ballpark. I'm like, really, a ballpark that'll work
Speaker 5: for you. That's a little sus isn't it. Because the
Speaker 5: point is they'd prefer a ballpark, and they're doing almost
Speaker 5: over the phone.
Speaker 4: They haven't come to my house.
Speaker 5: You'd think that they would inspect the home before agreeing
Speaker 5: to ensure it. But that is a feature for them,
Speaker 5: not a bug. The less they know, the better.
Speaker 3: Honestly, a lot of ballparks don't even have roofs, to
Speaker 3: be honest.
Speaker 4: A lot of ballparks burned down.
Speaker 2: Can you imagine the insurance on owning a ballpark, That's.
Speaker 4: What I'm saying.
Speaker 3: That's where you start to just think seriously about buying
Speaker 3: the insurance company.
Speaker 2: You know, yeah, yeah, yeah, But this.
Speaker 3: Is and you know, another great example I think, to
Speaker 3: a great comparison to Knowle's point, a terrifying one is
Speaker 3: anybody who works in the medical industry, you've seen something
Speaker 3: simpler when doctors or nurses say this person needs this
Speaker 3: treatment and the insurance company comes back and says, ah,
Speaker 3: that sounds like a luxury.
Speaker 4: They don't really need that second long do they?
Speaker 2: Oh, they they can totally pay for that if they
Speaker 2: want to.
Speaker 4: Yeah.
Speaker 3: Yeah, they did describe the vibes of their kidney when
Speaker 3: they signed up, so it's really on them. This is
Speaker 3: I think this goes to another issue, and this is
Speaker 3: a factor that is also a prime mover of the
Speaker 3: home insurance crisis which we are entering. It's the obfuscation
Speaker 3: because the scope of the problem was a big open
Speaker 3: secret in the industry. But for a long time, it
Speaker 3: was hard for the public to get information about this,
Speaker 3: to get the full lay of the land, because insurance
Speaker 3: companies were purposely hiding a lot of it. For a
Speaker 3: very long time. It was a herculean effort to get
Speaker 3: a look at the cost of insurance, the same insurance
Speaker 3: policies in different parts of the United States, because the
Speaker 3: private insurance companies didn't disclose that the same way like
Speaker 3: a lot of streaming places won't give you their exact numbers.
Speaker 3: That's their secret sauce, right, and you don't want you know,
Speaker 3: you don't want Johnny Blue Jeans in Enied, Oklahoma or
Speaker 3: wherever to learn that somebody else across the river somewhere
Speaker 3: is paying much less for the same product.
Speaker 5: Not to mention that some of these big players in
Speaker 5: the insurance space, like the State Farms of the World
Speaker 5: or whatever, they pretty much fall into that too big
Speaker 5: to fail category. So if they ever did have a
Speaker 5: bum year or maybe they had to pay out too much,
Speaker 5: they're going to get a bail out, and then it's
Speaker 5: like rinse and repeat kind of.
Speaker 2: You know, So, how do we even know what we
Speaker 2: know about how much insurance premiums cost on average, per state,
Speaker 2: per region, per you know, even town. Well, we didn't
Speaker 2: have There wasn't some group putting all those numbers together.
Speaker 2: Kind of like how remember we when we looked into
Speaker 2: murders and homicides and deaths in national parks and we
Speaker 2: were trying to find in the missing like the number
Speaker 2: of people. Nobody's out there collecting that data and putting
Speaker 2: it in a spreadsheet and publishing it online somewhere or
Speaker 2: in an article or journal. Nobody was doing that for
Speaker 2: homeowners insurance either until a dude named Benjamin Keys. Oh
Speaker 2: it's a ben it's one of the good ones. And
Speaker 2: Benjamin Keys comes along. He was a professor of real
Speaker 2: estate at the University of Pennsylvania's Wharton School. And another
Speaker 2: person named Philip Moulder. Oh my god, a Molder too, right,
Speaker 2: that's awesome. Good to be Trio, Moulder and Keys got together.
Speaker 2: Philip Moulder is a professor at the University of Wisconsin
Speaker 2: School of Business. They got together and said, hey, let's
Speaker 2: figure this stuff out, and we're going to tell you
Speaker 2: what they figured out right after a word from our sponsor.
Speaker 3: And we've returned. So we've already i think established just
Speaker 3: objectively hear the facts level, there are dangerous things on
Speaker 3: the horizon climate wise, both metaphorically and literally. And we
Speaker 3: learned about the study by Keys of Molder that you
Speaker 3: can read in full online thanks to a journalist named
Speaker 3: Christopher Flavelle writing for the New York Times. And they
Speaker 3: were saying, wait, why are home insurance rates distorted across
Speaker 3: this grand country of ours? And they said, all right,
Speaker 3: climate change drives it, right, it's me the heat, the
Speaker 3: wildfires you were talking about, and old the flooding we're mentioning,
Speaker 3: Matt the tornadoes. Of course, because part of this country
Speaker 3: is called Tornado Alley. And in a previous conversation we
Speaker 3: established how Tornado Alley is growing at a breakneck base
Speaker 3: again literally, and this is a well established trend, but
Speaker 3: it's not the whole story because it doesn't explain why
Speaker 3: a small town like Enid, Oklahoma, would be one of
Speaker 3: the most expensive places in the country to have home
Speaker 3: insurance relative to the actual value of your house. This
Speaker 3: is where we see what Keys and Molder do. They
Speaker 3: teamed up with a group called core Logic. Core Logic
Speaker 3: is another like hardcore and I say this with great
Speaker 3: respect nerd outfit. You know, they're math wizards. Their Property
Speaker 3: Information and Analytics group, and they get a lot of
Speaker 3: info from mortgage servicers. So if you own a home,
Speaker 3: you pay, you know, into your ESCRO account, and groups
Speaker 3: like core Logic get the information about what you're paid.
Speaker 3: And they got the data for about twelve point four
Speaker 3: million what we call owner occupied households, so not people
Speaker 3: flip in airbnbs, you know, none of the black rock stuff,
Speaker 3: people who live in the homes that they own. And
Speaker 3: then Keys and Malta did some really clever They went
Speaker 3: into these Escro accounts. They did some fancy financial forensics,
Speaker 3: and they managed to estimate what each household paid for
Speaker 3: property insurance. And then they found that, yes, there's a
Speaker 3: relationship between climate risk and what companies charge, but it's
Speaker 3: not all the same. It doesn't explain the discrepancy. Higher
Speaker 3: premiums are charged in every state where regulators don't ask
Speaker 3: as many questions from the company. Oh in other words,
Speaker 3: and oh is right. In other words, states with rubber
Speaker 3: stamp regulators serve the customers up to these private industries
Speaker 3: on a platter. And I would pose it that it's
Speaker 3: not going to be tough for us to find some
Speaker 3: revolving door situations where you know, you might work as
Speaker 3: a regulator and then later you get a plumb job
Speaker 3: for some of the prior.
Speaker 2: Yeah, yeah, dude, that's that's exactly what was found in Texas. Look,
Speaker 2: it's kind of a known thing. Texas is a state
Speaker 2: where regulations are frowned upon a little bit in general,
Speaker 2: not fully, but you know, let's say they're minimized on
Speaker 2: purpose in Texas. Unlike especially in California, when an insurance
Speaker 2: company wants to raise a rate, they we kind of
Speaker 2: get to just do that and then they get to
Speaker 2: ask for forgiveness later rather than asking permission upfront. In California, though,
Speaker 2: if you want to raise rates as an all state
Speaker 2: or whatever you know company, you are a state farm.
Speaker 2: If you want to raise rates, you have to go
Speaker 2: to California to a government body and say, hey, here,
Speaker 2: for X, Y and Z, we need to raise our
Speaker 2: home insurance premiums, you know, on average or whatever.
Speaker 5: So you'd have to make your case with like the
Speaker 5: increased prevalence of natural disasters and certain areas and tie
Speaker 5: it to specific events and say this is why we need.
Speaker 4: To do this.
Speaker 2: Yes, but in Texas you've got something called the Department
Speaker 2: of Insurance that takes a look at stuff. It approves
Speaker 2: the rates, but it takes a look at about half
Speaker 2: of the rate increases that happen every year from homeowner's
Speaker 2: insurance companies.
Speaker 5: So that's the rubber stamping we were talking about, right, Yeah, Yeah.
Speaker 3: I don't want to again, as we said, I don't
Speaker 3: want tom malign people unfairly, but it's it's giving big
Speaker 3: golf game conversation energy out there in Texas.
Speaker 2: Yes, you know what I mean, Yes, and I misspoke.
Speaker 2: They don't look at half of them. They look at
Speaker 2: all of them presumably, but they approve roughly half of them.
Speaker 2: Just like, yeah, definitely, you guys can raise.
Speaker 5: Rates, And is there an appeal process from the consumers perspective? Like,
Speaker 5: I know, for example, you can dispute property tax increases.
Speaker 5: There is a whole system in place for that, at
Speaker 5: least here in Georgia. But what about with the insurance rates?
Speaker 2: Yes, yes, in Texas there is one thing, you guys.
Speaker 2: In nineteen ninety one, the Texas State Legislature made a
Speaker 2: thing called Public Insurance Council or the Public Insurance Council,
Speaker 2: and they represent the interests of consumers and they attempt
Speaker 2: to maintain a quote, at least according to this article
Speaker 2: written by Michael Hardy in Texas Monthly, they attempt to
Speaker 2: a balanced marketplace.
Speaker 4: You're saying it in a way or I don't know
Speaker 4: if you believe that that's what actually happened.
Speaker 3: I heard, well, I heard italics.
Speaker 2: Mike. Michael put it in quotations in his.
Speaker 5: Arr italics voice too, Matt to be fair, No, it's
Speaker 5: it does seem sure, it's a good cover story.
Speaker 4: It's good for optics to say.
Speaker 5: No, no, no, no, we have this sub committee or whatever
Speaker 5: that's looking out for the best interest in the consumer.
Speaker 5: But it would seem to me that they do a
Speaker 5: bit of rubber stamping themselves, or at least I haven't
Speaker 5: heard of any much coming out of this short of
Speaker 5: a couple of like publicity grabs.
Speaker 4: Maybe I don't know. Tell me what you guys think.
Speaker 3: Well, there are also valid points which I guess we're
Speaker 3: ethically required to mention, and those valid points would be
Speaker 3: from their perspective. There would be arguments like, hey, people
Speaker 3: do need home insurance, right, so let's work with these entities.
Speaker 3: And then another one would probably be the kind of
Speaker 3: iron hand and velvet gloves of argument that happens so often,
Speaker 3: which is, we bring a lot of business to this state, right,
Speaker 3: or we as an industry employ a lot of people,
Speaker 3: which can be true but can also be an implicit threat.
Speaker 4: Yep.
Speaker 2: And there's a third perspective, get on YouTube and learn carpentry, dude,
Speaker 2: except I would never follow that. I wish I could
Speaker 2: repair stuff. You can learn anything homeowners.
Speaker 3: Right, right, I don't know. It's I love that you're
Speaker 3: bringing up this example because the effects of these state
Speaker 3: by state regulatory differences. Right, You're in a California, and
Speaker 3: it asks and we're not saying California is perfect by
Speaker 3: any means, but you're in a state where regulation has teeth,
Speaker 3: and you are required to come with some facts, to
Speaker 3: come with some quantitative data that shows the necessity of
Speaker 3: a thing, right, because they don't want you to leave
Speaker 3: either as an insurance company. They don't want those companies
Speaker 3: to leave. But then if you go to places with
Speaker 3: much more lax or compromised regulation, then you see that
Speaker 3: there is a huge discrepancy. You can go into this
Speaker 3: New York Times article. You can see the discrepancy in
Speaker 3: these pretty clever infographics wherein you can plug in like
Speaker 3: you can look at your own zip code or your
Speaker 3: own county and you'll see how weird this stuff goes.
Speaker 3: That is the reason the average premium has jumped thirty
Speaker 3: three percent in just three years, much higher than the
Speaker 3: rate of inflation from twenty twenty twenty twenty three. The
Speaker 3: system is unfair. You could live in this place with
Speaker 3: the same amount of risk regents, with the same amount
Speaker 3: of weather, the same chance for you know, a disastrous event,
Speaker 3: and you might pay a wildly different rate because some
Speaker 3: you might be in a place where the regulator sometimes
Speaker 3: do their job or sometimes don't. Dang, we've got a
Speaker 3: little lag because I'm recording on the road here. But
Speaker 3: just to be clear, that pause was purposeful. I was
Speaker 3: going for like a.
Speaker 4: Dramatic thing, but pregnant pause a pp.
Speaker 2: Pp And Ben, you found another quote from that same
Speaker 2: New York Times article that is unfortunate.
Speaker 3: Yeah, yeah, it's a little long, but I think it's
Speaker 3: worth I think it's worth hearing. Should we round robin it?
Speaker 4: Absolutely? Across the more than nine thousand zip codes for
Speaker 4: which data was available, the typical American household last year
Speaker 4: paid about five hundred dollars in home insurance premiums for
Speaker 4: every one hundred thousand dollars of home value, or zero
Speaker 4: point five percent, the professors found.
Speaker 2: But in California, which suffered through more than seven thousand
Speaker 2: wildfires last year, good Lord, the typical homeowner in many
Speaker 2: zip codes paid premiums as low as point zero five
Speaker 2: percent of home value.
Speaker 3: By contrast, the quote concludes in parts of Alabama, Oklahoma, Louisiana,
Speaker 3: and Texas, the average homeowner faced home insurance premiums greater
Speaker 3: than two percent of the value of local homes. Now
Speaker 3: zero point five point h five two percent. They may
Speaker 3: sound like small numbers until we realize we're talking about
Speaker 3: percentages of hundreds and hundreds of thousands of dollars.
Speaker 2: Well, yeah, and think about the vast differences in average
Speaker 2: home value there that are represented in a ton of
Speaker 2: homes in Louisiana versus a ton of homes in California.
Speaker 2: I don't want to sparage any homes in Louisiana. It's
Speaker 2: just you imagine the amount of wealth and money that
Speaker 2: goes out into many parts of California and the types
Speaker 2: of homes that are built, and the price increases in
Speaker 2: home value that have been happening out there.
Speaker 5: Well, I know we're largely kind of during this conversation
Speaker 5: around the climate change angle, but I did just want
Speaker 5: to just give a tiny quick conclusion to my kind
Speaker 5: of home insurance odyssey. After looking at this research and
Speaker 5: preparing for this podcast today this morning, I kind of
Speaker 5: lit a little bit of a fire under me to
Speaker 5: take care of this and stop overpaying for my homeowner's
Speaker 5: insurance policy that my mortgage just took it upon themselves
Speaker 5: assign me up for. And I received quotes from four
Speaker 5: different companies, including the company that I get my.
Speaker 4: Car insurance through and they were just all over the place.
Speaker 5: And there's a formulaic way that they ask you these
Speaker 5: questions and it's like literally to dictate it, I'm sure
Speaker 5: by legal legal ees and regulations, and it ultimately the
Speaker 5: thing they tell you upfront is this is the cost
Speaker 5: that we assess it would cost to rebuild your home,
Speaker 5: and that number you guys from four different organizations, completely
Speaker 5: different number, completely different number, and the kind of boilerplate
Speaker 5: cover they thought that I needed also completely different, and
Speaker 5: the deductibles also completely different. And it was really eye
Speaker 5: opening for me, how like if I'm a total you know,
Speaker 5: nube with this stuff, and I definitely am not armed
Speaker 5: a little more so now, but not to the degree
Speaker 5: that maybe someone who does this stuff for a living
Speaker 5: with the right questions or and I honestly it's so
Speaker 5: mandatory that I just don't know how much that would
Speaker 5: even help. And I was just to MAT's point earlier
Speaker 5: in the episode, I was just satisfied with getting my
Speaker 5: payment down by a couple hundred bucks a month and
Speaker 5: just to move on with it, because they just browbeat
Speaker 5: you with this stuff and you're almost left like in
Speaker 5: this submissive state where you're.
Speaker 4: Like, please just make it go away, Please just make
Speaker 4: it go away.
Speaker 5: And that's how I'm honestly get a little choked up
Speaker 5: talking about it in a weird way, because it is
Speaker 5: like emotional abuse in a way, you know, because you're like,
Speaker 5: am I am I complying? Am I complying? As long
Speaker 5: as I'm complying, you know? And I just was left
Speaker 5: with yeah, And I ultimately went with State Farm. And
Speaker 5: you know why I went with because it was cheaper
Speaker 5: and the guy was kind of nice and didn't sound
Speaker 5: like a dead eyed robot. And I got a better
Speaker 5: car insurance rate too, so I bundled. But even that
Speaker 5: stuff we haven't talked about. They'll be like, oh, we'll
Speaker 5: give you thirty percent off on your homeowners if you
Speaker 5: bundle your car.
Speaker 4: What up with that, y'all.
Speaker 3: Whenever somebody gives you a margin that large off, they're
Speaker 3: also giving you a sneak into how big their profit
Speaker 3: margin is to begin with. And you should always this
Speaker 3: is very this very I don't want to come off
Speaker 3: be a stereotype of myself, but this is also part
Speaker 3: of the reason why you should always check your car insurance.
Speaker 3: You should check every bill you have to pay regularly,
Speaker 3: because if you don't, it will just continue to kind
Speaker 3: of hitch its pants up as a bigger and bigger
Speaker 3: slice of your budget because people are counting on you
Speaker 3: to not care. They're counting on you to not dive
Speaker 3: into that boring stuff. It's boring on purpose, you know
Speaker 3: what I mean. And again, it's the system, it's not
Speaker 3: the individuals. Look, we know here in the US alone,
Speaker 3: thirty nine million different properties are vulnerable to one or
Speaker 3: more types of disasters. We know that about ten point
Speaker 3: seven million Americans right now live in a county where
Speaker 3: one hundred percent of the homes are vulnerable to that
Speaker 3: insurance correction. And those places tend to be less wealthy.
Speaker 3: They're less equipped to fight for their rights, you know,
Speaker 3: to do something. We're talking about our group text, you know,
Speaker 3: to get the lawyers to be able to take something
Speaker 3: to court when things are getting shisty. I mean it's
Speaker 3: going to it's going to expand, just like Tornado Alley.
Speaker 3: And also a bit of empathy, as weird as it
Speaker 3: may sound, for those insurance companies, if they can't make
Speaker 3: a profit, they can't exist either. So from their perspective,
Speaker 3: this is not about necessarily screwing people over. It's an
Speaker 3: existential threat, you know what I mean. You can't sell
Speaker 3: flood insurance if you know for sure the entire place
Speaker 3: is going to flood several times a year.
Speaker 2: No, that's why. You know, what is it? The five
Speaker 2: hundred year Floodplaine or whatever is a thing because there's
Speaker 2: some risk there. Buzz, five hundred years come.
Speaker 3: On, right, by which time I'll be retired, you know,
Speaker 3: out in Sioux Falls. I don't know why I'm referencing
Speaker 3: Sioux Falls. I think it's a please don't destroy sketch.
Speaker 3: You guys don't.
Speaker 2: Oh yeah, I love those guys. I really quickly got
Speaker 2: I found this. Apparently Vermont has a super low homeowner's
Speaker 2: insurance average. It was like seven hundred and ninety nine
Speaker 2: dollars average or something in Vermont. And there are lovely
Speaker 2: homes out there. Let's go to Vermont, benas country.
Speaker 3: Why don't we go to the country.
Speaker 2: Yeah, I don't even know what's out there, leaves no.
Speaker 4: Name the other draft.
Speaker 5: It's probably a good, probably be good for our mental health, y'all.
Speaker 5: I don't even know they got the internet in Vermont, y'all.
Speaker 5: Everyone's so mentally healthy and spry out there and just
Speaker 5: noodling on a banjo on a front.
Speaker 4: Porch with a weed in their mouth.
Speaker 3: Sanders, is there still like.
Speaker 4: Kicking it on the regular? Yeah?
Speaker 2: Oh hey, quick breaking news. I know we were talking
Speaker 2: about Vermont, but just talking about climate change with talking
Speaker 2: about disasters. I'm reading right here on ABC News that
Speaker 2: as we were recording a four point four magnitude earthquake
Speaker 2: Los Angeles.
Speaker 3: Yeah, California happened.
Speaker 4: Yeah.
Speaker 3: Actually one of our what I learned about, one of
Speaker 3: our old colleagues or former colleagues reported it apparently very
Speaker 3: very scary stuff. Also, the you know, the ring of
Speaker 3: fire is awakening. Is the problem the tectonic it's a
Speaker 3: cool name for the tectonic plate sensitivity around the Pacific,
Speaker 3: rim typhoons, earthquakes, It's all happening. Stay safe, Yeah, stay safe,
Speaker 3: and also let us know this larger question. I'm glad
Speaker 3: you got the breaking news for us there, Matt, because
Speaker 3: this does bring to mind a larger question. Disasters are
Speaker 3: becoming more frequent, less predictable, expanding to touch places previously
Speaker 3: considered safe, while also growing in severity. So where can
Speaker 3: people go for safety? What will the world look like
Speaker 3: beyond insurance, right beyond the financial stuff. Existentially, what is
Speaker 3: this planet going to look like? Not just next year,
Speaker 3: but within the next decade. Let us know, and also
Speaker 3: tell us your homeowner war stories. If you are a contractor,
Speaker 3: we got a lot of contractors in the audience tonight.
Speaker 4: Tell us the.
Speaker 3: Weirdest conversations you've had with an adjuster. I love to
Speaker 3: hear from you. We try to be easy to find online.
Speaker 4: That's right.
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