Ahhhhh, California. The Golden State. The state where you need a helluva lot of gold to live.

I dug into the notice we recently received about our homeowner’s insurance premium increases, and what I found isn’t pretty.

The last couple of years we’ve paid $6700/year for homeowner’s insurance with a $1000 deductible. That’s a lot, given that the national average is about $1400/year. That price is/was way up from five years ago, when we had to go shopping for insurance after being dropped by our carrier because of wildfire risk. At that time we found that Traveler’s would insure us if (a) we paid their big price increase, and (b) we consolidated all our insurance (homeowner’s, auto, umbrella, etc.) with them. We did that, as being able to get homeowner’s insurance is one of the things that keeps your property valuable. And of course, the hedge against catastrophic events.

That was five years ago. Fast forward to today, and insurers are taking a much harder line on wildfire risk. After years of big fires, almost all in northern CA, they’re moving to a computer-modeled risk scale that depends on satellite photos of your property. The software analyzes photos and assigns a risk rating to your property, and that’s used to decide if the company will insure your property and/or for how much. You cross their computer-generated risk score threshold, they’re not going to insure you. No discussion.

What I’m finding is that (a) most companies will now not even give us a quote, and (b) Traveler’s is doing us a favor with a quote refactored with the industry’s new models. Our $6700 premium / $1000 deductible policy is now renewable as a $23,000 premium / $10,000 deductible. A 400% cost increase.

What the insurance industry is saying is that they’re getting out of CA homeowners policy business, or if they stay, you’re going to have to be wealthy to afford their coverage. That may be a rational business decision, but it creates an irrational situation. Without insurance, your property value is essentially zero – you can’t sell it. And of course if it burns down and you have no other savings, you’re homeless. There are hundreds of thousands of homes and homeowners in this situation, maybe millions if you include Oregon and Washington.

I predict there will be some kind of regulatory relief for those in our situation. You just can’t let hundreds of thousands of homeowners’ equity drop to zero. But that will take time, probably years. So in the meantime I’m either (a) going to pay the usurious premiums for a few years, and/or (b) try to find another insurer who will write a true catastrophic coverage policy, something like a $5-10K premium with a $100K deductible, or even $200K. I would be OK with that. We don’t use our homeowner’s insurance for any small claims – in 18 years here, we’ve never actually made a homeowner’s insurance claim. We’re the perfect customer, other than the fact that we live in a semi-rural area with trees. In the Golden State.

It’s a slow day today. Just hanging around reading and doing minor chores. Feeling very retired…here are a few observations about the world today.

• Kanye West has lost his mind. I know it’s a story, but media needs to just ignore him. And someone needs to commit him for treatment.
• Georgians need to prove to the rest of the US that they’re sane by NOT electing Herschel Walker to the Senate.
• Trump continues to lose legal decisions, one after another. Couldn’t happen to a nicer guy.
• Alex Jones declares bankruptcy to avoid paying legal fines. Shocker.
• An official CA committee is recommending that CA pay $223K per person in slave reparations, to each of about 2.5 million people who identify as black or African American in CA. I don’t think that’s going to go over well in either political party.
• I have my final board meeting as a 211 San Diego board member next week. Not happy to be leaving the board, but those are the rules. Term limits.
• The FCC has released a national broadband map, showing what options are available for any US address. Pretty cool.
• The rain forecast for today in Socal is not happening. Another shocker.
• Our 2023 homeowner’s insurance quote is 4x higher than last year. We haven’t made any claims, so I’m not sure why. Gotta love the insurance business; it’s basically the Mafia with a lot of paperwork.

Like I said, a slow day. Happy Friday.

Casey Handmer, big thinker, strikes again. He and I arrived at the same solution to the western US’s existential water problem (desal plus large scale PV), but Handmer has put some high-level numbers on the idea and added the refill the rivers twist. Back of the envelope, it all pans out. This should be the future.

The number that sticks with me is that we could solve the water problems of southern CO, AZ and CA with less capital than Elon Musk spent for fucking Twitter. That’s…amazing. And sad. Our national priorities are so screwed up.

Spend capital on gigascale PV and desal. Pump fresh water upstream and use the natural river systems and gravity to distribute the newly-created fresh water to all the places it needs to go; to the places it used to go. And mine the waste brine for badly-needed elements like lithium and rare earth elements. Genius. Think of the jobs these investments would produce. A generation’s worth of construction jobs, project management jobs, engineering jobs, safety and inspection jobs, legal and accounting jobs….on and on. And it doesn’t have to be a government program, for you let’s-drown-government-in-a-bathtub types – all this could be done by the private sector, with guaranteed rates of return on capital spent, just like we provide utilities.

I would join this project. I might even commute to the office to be a part of this.