to democratize the tools to understand and address it. Glendon argues that climate stability “underpins all of civilization.”
What reinforces that stability is insurance: pooling capital to protect individuals from the risk of low-probability, high-consequence events. Just as health insurers need healthy clients to subsidize the costs of the sick, property/casualty insurers need robust models that keep premiums affordable and the company profitable.
Thus begins a tug of war between regulators who want insurance to be widely available at affordable prices and insurers who to price premiums to reflect the real risk—and maximize profit. That’s hard to do in California, Kevelighan says, because of proposition 103, a 1988 law that effectively caps rates and limits insurers’ ability to model for risk.
While Gov. Ron DeSantis recently signed a bill to reduce those lawsuits and fees, many Floridians find themselves unable to afford expensive insurance against floods, hurricanes and natural disasters. And so, in a state where homeowners already pay more than three times the national average to insure their homes, Floridians face the prospect of higher prices or potentially no coverage at all.
Click above to get Kevelighan’s comments. And below is a video interview with Columbia University climate economist Gernot Wagner on the real cost of wildfires.