The Insurance Crisis Nobody Is Talking About (With Bob Litterman)

The Personal Finance Podcast

Andrew Giancola

Business, Investing, Entrepreneurship

4.7 • 1.4K Ratings

🗓️ 5 June 2026

⏱️ 52 minutes

🔗️ Recording | iTunes | RSS

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Summary

Your home insurance bill is not going up because of inflation. It is going up because of a risk that was mispriced for decades and is now coming due. Episode Sponsor Coalition for an Insurable Future Website: https://coalitionforaninsurablefuture.com/ Facebook: https://www.facebook.com/people/Coalition-For-An-Insurable-Future/61584013622275/ What You'll Learn in This Episode Why home insurance is up 74% since 2008 and is not coming back down How one weather event turns into a coverage gap, an un-mortgageable home, and a collapsing property value Why insurance companies are not the villain here and who actually is What happens when state-backed insurance plans run out of money Why one in seven homeowners now has zero insurance coverage What every homeowner should do right now to reduce their exposure Why renters are not off the hook from this crisis either Start Here Join the community built to help you master your money, stay accountable, and reach financial freedom. 👉 Try Master Money Academy FREE for 7 days today! https://mastermoney.co/join/ 👉 Join Andrew’s FREE Investing for Beginners Masterclass https://event.webinarjam.com/q05p7/register/0o8z9io?webinar_id=21 👉 Join The Master Money Newsletter where you will become smarter with your money in 5 minutes or less per week Here! https://expert-hustler-605.ck.page/6aa7bb9a79 Watch Next How to Shave Off 7+ Working Years and Retire Early! https://youtu.be/9oZFn2lmZm4 Is the American Dream Dead? (With Freddie Smith) https://youtu.be/3Ivz8Ts9J2o How Companies Are Quietly Robbing You! With Lindsay Owens https://youtu.be/WhfXVmC2DC0 12 Financial Rules of Thumb That Let You Spend More on What You Love https://youtu.be/36HG6VHnA08 How to RETIRE BY 30! (With Cody Berman) https://youtu.be/ffKv6M69SRI How to Manage Your Money (and Still Enjoy Life) https://youtu.be/BWocw8B-xnY Who is Bob Litterman? Bob Litterman is the Risk Chairman Emeritus and a founding partner of Kepos Capital LP. Prior to joining Kepos Capital in 2010, Bob enjoyed a 23-year career at Goldman, Sachs & Co., where he served in research, risk management, investments and thought leadership roles. He oversaw the Quantitative Investment Strategies Group in the Asset Management division. While at Goldman, Bob also spent six years as one of three external advisors to Singapore’s Government Investment Corporation (GIC). Bob was named a partner of Goldman Sachs in 1994 and became head of the firm-wide risk function; prior to that role, he was co-head of the Fixed Income Research and Model Development Group with Fischer Black. Connect with Andrew Instagram → https://instagram.com/mastermoneyco Website → https://mastermoney.co TikTok → https://tiktok.com/@mastermoneyco X → https://x.com/mastermoneyco LinkedIn → https://www.linkedin.com/in/andrew-giancola-45027b340 YouTube → https://www.youtube.com/@mastermoneyco/ Question for you: Have you looked at your home insurance bill recently and been shocked by how much it went up? Drop your state and percentage increase in the comments and let us see how widespread this actually is. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	The mispriced risk is climate risk.
0:03.0	It's that we're not pricing emissions.
0:05.0	And so what that means is that there's too much emissions going on in the atmosphere,
0:11.0	and that's going to lead to real damages down the road.
0:16.0	And those damages are starting to show up now in extreme weather events and in insurance markets.
0:24.4	Homeowners, many of them, say, I can't afford that, and they drop their insurance.
0:29.5	We've seen a very worrying increase in the number of homeowners that don't have insurance.
0:36.2	It's almost inevitable that there's going to be an event that's going to cause the state plans to run out of money.
0:42.3	And then they're going to have to decide what are we going to do.
0:45.3	The cost of homes is going up, the cost of the insurance is going up, the cost of construction is going up,
0:50.3	the cost of electricity is going up.
0:52.3	All these things are going up. And so it's an
0:55.8	affordability crisis. We're talking about a long-term destruction of wealth, which is really sad.
1:02.9	We're not prepared. We're not doing the right things to be prepared.
1:08.6	This episode is brought to you by the Coalition for an Insurable Future.
1:14.1	What if the biggest threat to your net worth isn't the stock market? It isn't inflation,
1:18.5	and it isn't your mortgage rate. What if it's a line item on your insurance renewal that most
1:22.9	people glance at and toss in the drawer? Today's guest is Bob Litterman. Bob spent 23 years at Goldman Sachs running risk for the entire firm.
1:31.4	He co-created the Black Litterman model, which still is one of the most widely used frameworks
1:36.6	and institutional portfolio construction.
1:39.3	And he is now saying that what is happening inside U.S. home insurance market is one of the most
1:43.7	mispriced risk that he has ever seen in his entire career. Now, here's what that means for you.
	...

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