06-07-2024, 07:50 PM
"So there are insurers that are starting to nonrenew some policies in certain areas, but it’s not a significant amount and I think in the homeowners market there’s still sufficient capacity to cover those nonrenewals.”
Dams don't break all at once, they start with the water barely seeping through.
The thing about Dungbu is that they are only cancelling policies they deem to be worth under 400k, even if the market value is higher than that. So they are shedding properties because they can. If it was due to risk aversion, wouldn't replacing the higher priced properties cost them more? Riskier policies have higher premiums because "the market" will cause policyholders to change on their own. They didn't get people to leave them voluntarily by jacking up their premiums, they fired their customers. They are probably dumping customers because they have a limited number their reinsurer will allow them to keep. They believe their $400k+ customers have the financial capacity to absorb a big upcoming rate hike the sub $400k ones don't, and they don't want to waste their time canceling policies due to non-payment, contacting lenders, dealing with customer disservice issues, etc. Getting rid of the Puna Peasants now will save them time and money later.
Dams don't break all at once, they start with the water barely seeping through.
The thing about Dungbu is that they are only cancelling policies they deem to be worth under 400k, even if the market value is higher than that. So they are shedding properties because they can. If it was due to risk aversion, wouldn't replacing the higher priced properties cost them more? Riskier policies have higher premiums because "the market" will cause policyholders to change on their own. They didn't get people to leave them voluntarily by jacking up their premiums, they fired their customers. They are probably dumping customers because they have a limited number their reinsurer will allow them to keep. They believe their $400k+ customers have the financial capacity to absorb a big upcoming rate hike the sub $400k ones don't, and they don't want to waste their time canceling policies due to non-payment, contacting lenders, dealing with customer disservice issues, etc. Getting rid of the Puna Peasants now will save them time and money later.