« Pity my dentist | Main | Thank-you note »


Feed You can follow this conversation by subscribing to the comment feed for this post.

silly things

"healthy customers" are analogous to residents with homes in areas that are not hurricane-prone; do we think they are carrying hurricane insurance?

The above is not an issue for a good disaster insurance co for 2 reasons.

1. disaster insurance companies operates over both space and time (not just space).

2. disaster insurance insures against different uncorrelated disasters. Places without hurricane may have earthquake.


ST: Good comment. The problem for a hurricane insurer is to find customers who won't need payouts when a hurricane hits, otherwise it will go bust every time. This spatial concentration is unique to the hurricane (natural disaster) insurance business.
Insurers do not put premiums collected from hurricane policies in the same risk pool as those collected from earthquake policies. In fact, some even ring off Florida policies into its own risk pool precisely because other states that are not as exposed to hurricanes do not want to be in the same pool as Florida.
The book discusses all this in greater detail. The point is that in reality, you can only put people into the same risk pool if they feel like they are "fairly treated".
There is something called reinsurance that pools together policies from uncorrelated disasters. I think those structures are a disaster waiting to happen. Will write more about that in the future.


I frankly hope that not repeat disaster from previous hurricanes.


Insurance Claim Help Florida

The next major hurricane to hit Florida should answer all your questions.

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Your comment could not be posted. Error type:
Your comment has been posted. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.


Post a comment

Your Information

(Name is required. Email address will not be displayed with the comment.)

Marketing and advertising analytics expert. Author and Speaker. Currently at Columbia. See my full bio.

Spring 2015 Courses (New York)

Jan 26: Business Analytics & Data Visualization (14 weeks) Info

Feb 23: Statistics for Management (10 weeks) Info

Mar 28: Careers in Business Analytics & Data Science (one-day seminar) Register

Apr 7: The Art of Data Visualization Workshop (6 weeks) Register

Next Events

Sep: 28 Data Visualization New York Meetup, New York, NY

Oct: 5 Andrew Gelman’s Statistical Communications class, Columbia University

Oct: 13 AQR ProSeminar, NYU Sociology

Oct: 22 Leading Business Change Through Analytics, Columbia Business School

Oct: 30 Ray Vella’s Designing Infographics class, NYU

Past Events

See here

Junk Charts Blog

Link to junkcharts

Graphics design by Amanda Lee


  • only in Big Data