Is the World Becoming Uninsurable?

As tail risks increase greatly, insurance costs should rise very non-linearly because how actuarial risk calcs work. Basically, to simplify the work of actuaries greatly, a 10x or greater increase in tail risk¹ means that most areas are no longer insurable.

We’ve reached that now with recent disasters in the North Carolina and with the LA fires.

Soon, I’d expect many places to have no insurance available at any price. And yes, that has everything to do with climate change.

1. Rather, the unpredictability of likely tail risk costs.