Betting Against a Storm

11/30/22 • 30 min

We’ve told you the insurance industry in Florida is in crisis. Or as one industry insider put it, it’s holding on by “a piece of chewing gum.”

In this episode, we explore possible solutions. We dive into the business of reinsurance, or insurance for insurers (turns out you can insure almost anything, including insurance policies); and we look at another possible solution that was born from the wreckage of Hurricane Andrew 30 years ago: the catastrophe bond, a financial instrument that allows investors to bet against storms and make money on risk. So long as a big storm doesn’t wipe them out completely.

We’ve told you the insurance industry in Florida is in crisis. Or as one industry insider put it, it’s holding on by “a piece of chewing gum.”

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Special Episode: Ask Amy Anything

You asked, we answered. Listeners wrote in wanting to know: “Who the hell loans these people money for mortgages” in risky coastal areas? Who ultimately owns the risk? Do certain investments, like REITs, drive gentrification (and what the heck is a REIT, anyway)? And finally, we tackle the age-old riddle: to rent or to buy? This episode is devoted to answering listener questions.

Next Episode

Swampland for Sale

In this episode, we travel back in time to the place South Florida used to be — the Everglades before it was drained, developed and transformed into the megalopolis we know today. We start with a bird’s-eye view of the ecosystem. Then we get down on the ground to look at the consequences of drainage up close. Finally we discuss why a restoration plan passed more than two decades ago is more pressing now than ever before.