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No insurance companies care. They are all in business to make money. I can’t blame them for not wanting to insure a disaster-prone area.

Hahaha I heard the jingle as I read it! Perfection!

I agree, however I also agree that you should not expect to be able to build in an area that is prone to disaster. Like if I build my house on a Sandy Beach and the foundation fails because it's on Sand I'm not going to expect that the insurance company is going to cover it. The same should be considered for areas that are prone to natural disasters like California or Florida with Hurricanes

It’s true, these are externalized costs.

Socialize the costs, privatize the profits

“Like a good neighbor, State Farm is there” means that they resemble a good neighbor only insofar as both share the attribute of existence.

Non-coastal new England is pretty safe. No earthquakes, few hurricane effects, almost no tornadoes, tends to stay damp enough and has enough old deciduous growth, where forest fires aren't a big issue.

I am sure there are other places that are low risk as well.

Where does the CEO live again?

Part of the problem is that many of the states where insurance companies are leaving have rules that limit what they can charge. That sounds good in principle, but with climate change causing these disasters to happen more often the insurance companies are bleeding money. Ultimately insurance as an industry can't work if you keep having losses, and if you can't increase prices to cope then you have no choice but to withdraw.

I've sure State Farm is happy to cover catastrophe-prone areas, but only if they won't lose money on average.

The only one forcing people to have homeowners insurance is mortgage companies, that want to ensure the collateral on that mortgage doesn’t disappear.

That and common sense, as even if you don’t have a mortgage, you also don’t want a disaster to make your largest asset go poof.

There is competition. That is meant to keep prices lower. But insuring people in disaster prone areas just isn’t a wise business decision.

Not (re)building in areas prone to wildfires, mudslides, floods, and the like would be a good start. Otherwise, someone has to pay to rebuild when the ever more frequent disaster hits. State farm and other insurers suck in many ways, but this isn't unreasonable on their part.

It's not that simple. Yes, power lines do start a lot of fires, but climate change induced drought is the main cause of the scale and frequency of wildfires in California. If the conditions are right it's only a matter of time until something sets it off.

It's not about that. That's the insurance industry's cover story.
The real story is insurance companies giving a hissy fit about being subject to regulation by the state's insurance commissioner.
If the insurance industry was only dropping coverage in the middle of forests, or on beachfront or riverfront property, that would make sense. But it's not. They're dropping coverage on infill development in the middle of cities.