Dec
05

EPA Deregulation’s Increased Risk for Real Estate

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It is the business of insurance companies to price risk. Insurance, in fact, has been doing this since the second millennium B.C., as evidenced in the Babylonian Code of Hammurabi.

It is the business of insurance companies to price risk. Insurance, in fact, has been doing this since the second millennium B.C., as evidenced in the Babylonian Code of Hammurabi. Lloyd’s of London has been underwriting risk since the 1750s, and Benjamin Franklin set up a fire insurance company in the colonies as early as 1752. Today, no commercial real estate owner would consider foregoing property and casualty insurance.

A key reason for the long-term success of insurers is a by-the-numbers discipline. Statistics rule in this field, almost beyond any other. Risks are evaluated by the magnitude of potential loss, and by its probability. The calculations are cold, with little or no tolerance for sentiment or ideology. Loss is more or less inevitable—though it can be mitigated—and must be appropriately priced…

EPA Deregulation’s Increased Risk for Real Estate

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