Who Should Bear the Cost? Socialized versus Market-Based Risk Management
Natural disasters are becoming more severe and costly—who should bear the financial burden? We explore the tension between socialized risk and market-based insurance.
Topics covered include:
The surprisingly large percentage of natural disaster losses that are uninsured
Why natural disaster severity is increasing
A deep dive into the complexity of the home insurance market, including state-run home insurance plans
How California has tried to update its home insurance regulations, leading to potentially greater coverage but higher premiums
How socialized insurance relieves the cost burden to consumers but can also lead to riskier behavior and adverse risk selection
