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Remember "Katrina Cars"? They're baaaack!

posted by martyb on Sunday September 03 2017, @09:18AM   
from the random-and-intermittent-failures dept.

An Anonymous Coward writes:

https://qz.com/1066966/how-many-cars-were-destroyed-by-hurricane-harvey/ and also at other news outlets.

For Harvey victims, it's going to be rough if they lost their car, Houston is a very car-dependent city. Like many states, Texas only requires liability insurance — only those that bought comprehensive coverage will be able to claim the loss on insurance.

Ideally most of these flooded cars will be scrapped, as it's very likely water damage to electrical systems and other parts are not cost effective to repair professionally. However, there will be "new" and used cars on the market that have been underwater (to a greater or lesser extent). Many will be sold "as is" and some of them will be cleaned up and sold fraudulently as if they were not damaged. Buyer beware, these cars will be shipped all over in search of buyers (marks?)

After Katrina, friends of mine with time on their hands bought several new-flooded Honda Civics (which they were familiar with from building "street stock" race cars). They pulled out the interior and then the full wiring harness. Bought new harness from Honda and replaced everything, and had perfectly good near-new cars for pennies on the dollar (and a few days of hard labor).

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Original Submission

• Re:Happened to me (Score: 3, Interesting) by TheRaven on Monday September 04 2017, @09:00AM

  by TheRaven (270) on Monday September 04 2017, @09:00AM (#563362) Journal

  Insurance companies were one of the reasons that Katrina turned into such a disaster. They hadn't properly modelled the correlated risks. Insurance companies attempt to diversify their risk so that there's a very low probability of their having to pay out everything at once. For example, if flooding in New York is unlikely and flooding in San Francisco is unlikely, then it's very unlikely that there will be flooding in both at the same time. Unfortunately, a lot of things that they had thought were independent were interdependent and so several moderately large insurance companies went bankrupt. This led to a lot more studying of correlated risks in the the following years. The next big hurricane actually caused more property damage, but insurers were properly hedged and so were all able to pay out properly. It also led to some interesting discoveries, such as the fact that in Italy you couldn't restart the power stations after a total grid failure without the telephone network and you couldn't use the telephone network until the power grid was back online.

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