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View Full Version : In case of nuclear war your insurance won't pay off



Drunk Vegan
2010-Mar-06, 09:58 PM
I just started working for one of the major U.S. insurance companies, as a claims processor.

I got a big giggle when I was going through the training material and found a section devoted to nuclear and conventional warfare.

Apparently, homeowner's insurance will not pay off in the event of a nuclear detonation, unless your house happens to be far enough away that it catches on fire but doesn't explode.

So if the house is in the blast zone and gets knocked down, no payoff; also no radiation exposure or damage is covered.

For conventional warfare there is no coverage at all, because it's "a random and unpredictable event." That puzzled me... isn't that what insurance is for, to cover random and unpredictable events?

BigDon
2010-Mar-06, 10:13 PM
Insurance doesn't cover "Acts Of War" since about the second year insurance was invented. ""I bet you a thousand sestercies we don't see than Hannibal guy again."

If the nuclear explosion was an act of negligence and not an at of war somebody might have a case.

ngc3314
2010-Mar-06, 10:32 PM
"No one will have the endurance
To collect on their insurance
Lloyd's of London will be loaded when we go."

- Tom Lehrer

SolusLupus
2010-Mar-06, 10:44 PM
I just started working for one of the major U.S. insurance companies, as a claims processor.

I got a big giggle when I was going through the training material and found a section devoted to nuclear and conventional warfare.

Apparently, homeowner's insurance will not pay off in the event of a nuclear detonation, unless your house happens to be far enough away that it catches on fire but doesn't explode. While that lowers the number of houses that would be affected, that's still a lot. I think that would bankrupt a company if a lot of their customers were in that area.


So if the house is in the blast zone and gets knocked down, no payoff; also no radiation exposure or damage is covered.

For conventional warfare there is no coverage at all, because it's "a random and unpredictable event." That puzzled me... isn't that what insurance is for, to cover random and unpredictable events?

I'm honestly surprised they even give a reason. Major events like that are not something I think insurance companies can handle, unless the war is a really small one.

TheHalcyonYear
2010-Mar-07, 01:22 AM
Insurance isn't designed to cover any event that might happen. It is designed to spread the risk for certain events that might occur in an area. No one is going to write a reasonable flight insurance policy that will pay off for accidents that occur while an unlicensed child is flying a commercial jet. However, since the average passenger would have to fly nonstop for something like 1000 years before they were involved in an accident while flying a commercial jet flown by an airline based in the U.S., it is easy to spread the risk and offer reasonable policies.

it doesn't surprise me that wars, or nuclear attacks, are not insured against. It is not easy to provide adequate spread of the risk when such events occur.

sarongsong
2010-Mar-07, 01:34 AM
There seems to be plenty of non-war related coverage available:
...Currently, there are 104 commercial nuclear power reactors in operation in the United States...effective January 1, 2010, the total amount available for third-party nuclear liability claims in the event of an accident at a commercial nuclear power reactor is approximately $12.6 billion––the largest amount of nuclear liability capacity of any country in the world...
amnucins.com (http://www.amnucins.com/Media%20Center.html#Limit)

Van Rijn
2010-Mar-07, 01:36 AM
I remember reading that in the home insurance policy back in the '80s, and got a few laughs when I mentioned it to people. There were jokes about the insurance company that would insure, and send a rep. to your cave with a check.

Van Rijn
2010-Mar-07, 01:41 AM
There seems to be plenty of non-war related coverage available:

That's not about nuclear bombs.

swampyankee
2010-Mar-07, 03:28 AM
iirc, my homeowner's insurance (and every policy I've ever read) specifically excludes acts of war and civil unrest, so not only are you toast if Berzerkistan attacks, you're claim is also invalid if it's because your neighbors decided to sponsor a riot.

I'm not sure acts of terror are covered; I believe that the policies written after 11 Sept 2001 exclude those, too.

HenrikOlsen
2010-Mar-07, 08:32 AM
... you're claim is also invalid if it's because your neighbors decided to sponsor a riot.
In that case you're expected to get compensated through a civil claim on your neighbors.

swampyankee
2010-Mar-07, 01:42 PM
In that case you're expected to get compensated through a civil claim on your neighbors.

Well, you could try, but since they're all renting, they probably don't have much money :whistle:

Insurance companies are weird beasts; a few years ago my wife injured her back putting our then one-year old into a car seat. Our health care provider wouldn't cover the medical expenses (which were fairly small, just a couple of doctors' visits and some prescription medication) because a car was involved.

tdvance
2010-Mar-07, 01:53 PM
I've looked at my policy---I'm covered if a volcano erupts in my house (whew!), but NOT for an earthquake. Problem is, though rare, Maryland HAS had earthquake damage to houses before.

swampyankee
2010-Mar-07, 01:58 PM
I believe quite a few lawsuits from the time Katrina hit the Gulf Coast are still wending their ways through the courts, as almost all standard insurance policies exclude flood damage, so if your house was knocked down by wind, you're covered, but if it was destroyed by a wave, you're not.

My opinion on this? The insurance should cover flood damage, with the appropriate revisions to the rate structure. Flood zones move; when I bought my house it was outside of a flood zone. Now, it's in one.

tashirosgt
2010-Mar-07, 03:41 PM
In NM USA, there are many places where the primary danger from flooding is the presence of large irrigation canals. Flood insurance does not cover flooding from irrigation. The agency that manages the irrigation system, "Elephant Butte Irrigation District", is exempt from being sued for damage caused by it's irrigation system.

Also, I find it curious that if you visit the website of the Elephant Butte Irrigation District, you won't find it simple to figure out whether they are a Federal or State or Private organization, who appoints their Board Of Directors and little facts like that.

Fazor
2010-Mar-07, 04:40 PM
I've looked at my policy---I'm covered if a volcano erupts in my house (whew!), but NOT for an earthquake. Problem is, though rare, Maryland HAS had earthquake damage to houses before.

You can probably add earthquake coverage by endorsement. You can in Ohio.

Krel
2010-Mar-07, 04:49 PM
If I am close enough to a nuclear blast that my home gets damaged, or destroyed, then I don't believe that I will be worrying over much of anything afterward.

David.

swampyankee
2010-Mar-07, 07:08 PM
If I am close enough to a nuclear blast that my home gets damaged, or destroyed, then I don't believe that I will be worrying over much of anything afterward.

David.

Well, you could be away on vacation that day. :whistle:

kleindoofy
2010-Mar-07, 08:02 PM
I just started working ... as a claims processor. ...
Did you have to sign your employment contract with blood? ;)

Drunk Vegan
2010-Mar-07, 08:23 PM
Did you have to sign your employment contract with blood? ;)

No, in urine.. it's cheaper to test for drugs that way :)

kleindoofy
2010-Mar-07, 08:37 PM
No, in urine.. it's cheaper to test for drugs that way :)
Ahh, but I must be correct in assuming that your boss has horns and a tail, carries a three-pronged pitchfork and smells slightly of sulphur and brimstone. No? ;)

Drunk Vegan
2010-Mar-07, 08:58 PM
Actually he's the boss of the claims adjusters located elsewhere.. at my location we just take the claim info, we don't deny them. My boss is a rather ordinary old man who smells strongly of Ben Gay.

Fazor
2010-Mar-07, 09:31 PM
. . . at my location we just take the claim info. . .

Ah, well you've always seemed to be intelligent (I say 'seem to be' since it's the internet, and for all I know you're really just some advanced forum posting software ;)). I think you'll be fine. But do me a favor; if you ever hear one of your co-workers treating a customer badly, please kindly remind them, via the massive mallet'o'education, that the customer is some agent's livelihood and we work very hard to get and then retain their business!

Most of our claims people are good; from the ones taking the claim initially, to our adjusters in the field. I get annoyed when one of the small percentage of bad ones does something to endanger our business. I'm good enough at screwing things up and making people mad; I don't need help from the home office! :)

Drunk Vegan
2010-Mar-27, 02:23 PM
Well, been there for about a month now, and I'm really liking it. The people are nice, and the focus is definitely on quality work rather than quick call handling time, which is great. They are also excellent at recognizing employee achievements.. lots of little perks for performance.

We began the auto portion of the training last week, and I discovered another tidbit about nuclear war.. apparently your auto policy *will* pay out, but only if it's a disaster caused by a nuclear power plant. And in that case it only pays for damages beyond what the power company is already liable to pay you.

I wonder, since this applies to auto, if EMPs would be involved. I have no idea whether an electromagnetic pulse could actually be generated by a nuclear power plant, but that would definitely kill a car quick if it were nearby.


iirc, my homeowner's insurance (and every policy I've ever read) specifically excludes acts of war and civil unrest, so not only are you toast if Berzerkistan attacks, you're claim is also invalid if it's because your neighbors decided to sponsor a riot.

It's true that Homeowners won't cover riots, however auto policies will, if you have Comprehensive insurance which covers basically everything, as opposed to Collision or Liability-only.


But do me a favor; if you ever hear one of your co-workers treating a customer badly, please kindly remind them, via the massive mallet'o'education, that the customer is some agent's livelihood and we work very hard to get and then retain their business!

Out of curiosity, are you an agent? If so, *please* keep in mind that property claims people can't talk to customers about their coverages and deductibles - only agents and adjusters can. I get at least 5 calls a day where people are saying that their agent told them to call us for that information. It's very irritating having to refer them right back to their agent, or have to go ahead and take a claim to get them assigned to a claims adjuster, when we don't even know if it's worth their while to do so (deductible might be higher than damages, or they might not be covered).

TheHalcyonYear
2010-Mar-27, 10:31 PM
I believe quite a few lawsuits from the time Katrina hit the Gulf Coast are still wending their ways through the courts, as almost all standard insurance policies exclude flood damage, so if your house was knocked down by wind, you're covered, but if it was destroyed by a wave, you're not.

My opinion on this? The insurance should cover flood damage, with the appropriate revisions to the rate structure. Flood zones move; when I bought my house it was outside of a flood zone. Now, it's in one.
Actually, the purpose of insurance, is to mitigate the costs associated with moderate risk by spreading it out. Insurance is not, however, magic. If one's home is on a very flood prone portion of the Mississippi flood plane (as determined by actuarial data), one will find it either difficult or very expensive (or both) to get insurance because the risk is very high and the risk cannot be easily spread. The result is that insurance against some event is most difficult and/or expensive at the point where the risk is greatest. This isn't greedy insurance companies, this is the nature of insurance and risk mitigation.

TheHalcyonYear
2010-Mar-27, 10:34 PM
There seems to be plenty of non-war related coverage available:
That's because the risk associated with these is much easier to assess.

Fazor
2010-Mar-27, 10:48 PM
Out of curiosity, are you an agent? If so, *please* keep in mind that property claims people can't talk to customers about their coverages and deductibles - only agents and adjusters can. I get at least 5 calls a day where people are saying that their agent told them to call us for that information. It's very irritating having to refer them right back to their agent, or have to go ahead and take a claim to get them assigned to a claims adjuster, when we don't even know if it's worth their while to do so (deductible might be higher than damages, or they might not be covered).

Yeah I am. I can't imagine telling one of your own customers to call claims about their coverage though. That's sort of what the agent is for. But I'll admit there's a lot of really bad agents out there. Too many of them only care about sales and not service. I don't get commision, so maybe that's the difference.

swampyankee
2010-Mar-28, 01:01 PM
Actually, the purpose of insurance, is to mitigate the costs associated with moderate risk by spreading it out. Insurance is not, however, magic. If one's home is on a very flood prone portion of the Mississippi flood plane (as determined by actuarial data), one will find it either difficult or very expensive (or both) to get insurance because the risk is very high and the risk cannot be easily spread. The result is that insurance against some event is most difficult and/or expensive at the point where the risk is greatest. This isn't greedy insurance companies, this is the nature of insurance and risk mitigation.

Of course insurance against flood damages in areas where there is a high likelihood of flooding should be more expensive than in places where flooding is not likely, just as it should be more expensive if you build a house in a area that's highly prone to massive fires, as did a lot of people in California. If that means that the insurance is unaffordable, it is only a problem in that areas that are prone to flooding (or massive conflagration) move, which may cause some homeowners to experience sticker shock. It is not, as far as I'm concerned, a problem for people who are moving into an area, as they should be apprised of the risk, including the possibility that the homeowner's insurance on their beachfront cottage will be more expensive than the mortgage.

Fazor
2010-Mar-28, 02:39 PM
That's why we urge people to call and get a quote before they lock themselves into a purchase. Holds true for home or automobile. Yet as much as we tell people it's a simple matter, they still do things like go out and buy a brand new Ford Mustang for their 17 year old driver who already has three tickets and an accident, then get upset when they find out the kid'll be paying $400/month for insurance.

tdvance
2010-Mar-28, 06:09 PM
If all else fails, there is always Lloyds of London, with a reputation for insuring just about anything....though it will cost you the fair amount (expected value) plus profit proportional to the risk (standard deviation and/or some term to deal with not really knowing the odds too well) which, if you want to insure a house on the flood plain of the Mississippi, would be quite expensive indeed. After all, an insurance company's goal is usually NOT to go bankrupt.

TheHalcyonYear
2010-Mar-29, 12:23 AM
If all else fails, there is always Lloyds of London, with a reputation for insuring just about anything....though it will cost you the fair amount (expected value) plus profit proportional to the risk (standard deviation and/or some term to deal with not really knowing the odds too well) which, if you want to insure a house on the flood plain of the Mississippi, would be quite expensive indeed. After all, an insurance company's goal is usually NOT to go bankrupt.
And Lloyds of London is a perfect example of the gambols that are taken in the name of insurance. Lloyds is not so much an insurance company as a brokerage house that brings insurers into contact with those who have either large risks or smaller risks but large amounts of capital at stake. However, Lloyds is famous for insurers who have been bankrupted by mismatching risk and capital outlays.