Originally Posted by Rain Dog
Marine insurance is so terrible. I have been waiting for some company to realize they can make a killing by selling insurance at lower rates to responsible boat owners. Marine insurance does not seem to have even a basic interest in evaluating risk. That seems insane to me when you sell insurance.
What? Where does this thought process come from?
Tell me, how does an insurer identify "responsible boat owners"? Is a "responsible boat owner" who has a claim due to a sudden, direct, accidental physical loss to the boat (the situation that insurance is designed for) not in the category of non-responsible?
We evaluate risk 24/7, and I think we do a pretty good job at it, especially given the volume of policies we have on the books. We have to ascertain and plan for not just the true claims, but the unforeseen claims such as storm events, as well as plan for fraudulent claims (yes, they do happen).
The shared risking pool that insurance is does keep costs down, despite rumors to the contrary. If one chooses to live in a CAT zone, part of that choice is the higher insurance costs based on the frequency and severity of storm events. Conversely, lower insurance premiums are realized in areas not subject to storm events, such as the Northeast or Northwest.