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Re: [TowerTalk] Insurance for Tower

To: towertalk@contesting.com
Subject: Re: [TowerTalk] Insurance for Tower
From: "Roger (K8RI) on TT" <K8RI-on-TowerTalk@tm.net>
Date: Thu, 28 Nov 2013 22:22:58 -0500
List-post: <towertalk@contesting.com">mailto:towertalk@contesting.com>
On 11/28/2013 11:36 AM, Kenneth Goodwin wrote:
Jim has hit the nail on the head.  Another area that all of the major
insurance carriers departed from after Hurricane Ike was the Texas coast
(one mile from any body of water was the State Farm cancellation policy).  I
wouldn't file a claim today unless the entire house was damaged so
essentially I am only insured against a total loss.  Even then if you read
the details of an insurance policy, the claim rules change significantly.
Most of these changes (e.g., change in the deductible for peril against a
named storm)

Named Storm: Does that now mean the new policy of naming winter storms removes them as well?

73

Roger (K8RI)

are beginning to be clearly spelled out in the policy.  So to
file a claim for just a tower is an invitation to cancellation and with a
recent claim on record (publically available data), you will find out what
expensive insurance really means.  I would highly suggest the ARRL equipment
insurance.  It is a marine policy, no questions asked, solely based on the
insured value in dollars and you can specifically pick what you want
insured.  Again recent claims may result in a denial from the ARRL
subcontracted insurance company.  Personally I can't wait until all of this
hits New Jersey/New York and I can listen to them scream and cry foul.
Obviously they were not paying attention to the Katrina, Ike and Florida
insurance policy holders.  Ken K5RG
------------------------------

Message: 7
Date: Thu, 28 Nov 2013 07:15:29 -0800
From: Jim Lux <jimlux@earthlink.net>
To: towertalk@contesting.com
Subject: Re: [TowerTalk] Insurance for Tower


On aspect, not specific to Kimo's anecdote, is that experience with
insurance companies before 2007 may not be relevant today.

The market and banking system anomalies hit insurance companies hard.
In school you learn about the idealized scheme where the sum of all the
premiums collected from all policy is slightly more than the sum of all the
loss payouts for the year.

However, in reality, what happens is that the money that is paid in, and not
yet used to settle claims, is invested in various speculative instruments
ranging from T-bills/T-bonds to Credit Default Swaps and other exotic
investments.  In "good times" the profits from these investments allows the
insurance company to charge lower premiums for a given loss experience (e.g.
they only need to collect enough that
premiums+investment profits is > loss payouts).

AIG, for instance, was making money hand over fist by taking the counter
side to mortgage defaults: e.g. they were betting that the mortgages
wouldn't default, and they could collect premiums and never payout.
This allowed them to offer very competitive rates in their other lines of
business.  OOps, that didn't work so well when the laws of probability went
against them.

So, now, insurance companies in general have to charge higher premiums:
the investment income isn't there, the loss payouts are still there, so
premiums have to go up.  Or, they can manage the future loss payouts.

And the latter is being manifested in a variety of ways:
Here in Southern California, it is becoming VERY hard to get new policies
written on existing houses, because large swathes of subdivisions are now
deemed "high fire risk"; essentially you draw a boundary some X hundred feet
from the boundary to undeveloped land, an everything in there is in the
hazard zone.  Whether they are or aren't in real life is irrelevant  (There
are lots of cases where the concern is legitimate.. urban/wildland interface
is a big problem).  The problem is that anything that triggers a
re-evaluation is a potential cause for your insurance going away.

I think this is similar to the problem in Florida with hurricanes.  The big
players have decided it's not worth it to insure houses in FL any more.

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