It would make more sense if community just set up contracts amongst themselves to pool together with monthly community fund added to the pile and if something happened, then a clause in the contact begins and facilitate the steps to release fund for that person. Contract could set up arbiter (paid hourly) to determine whether the claim is covered by the contract agreed by the subscribers.
The major difference in this model is basically that the perverse incentive is removed whereas commercial insurance have every incentives not to pay out to claimants which defeats the purpose of insurance in the first place.
I don’t know much about insurance laws or contracting to say for sure, but part of me is wondering why we haven’t popularize this idea yet.
Still can’t provide a solid service because these days you need to have re-insurance when single Florida Hurricane or California fire will cause several billion dollars of damage.
Assuming every single Florida person paid into a mandatory Mutual insurance pool.
Given 10m house units in Florida, hurricane Ian alone did 100 billion dollars of damage. That’s 10k per house of damage. Of course that’s not all residential house damage, but only 1 hurricane. that just gives you a rough scale of how insurance just won’t work in Florida no matter what in the face of climate change.
Mutual insurance is closer to this setup. Policy holders are the main shareholders of the company. Issue is that most policy holders won’t be able to insure each other in Florida if most habitable areas of Florida will be underwater by 2050.
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