Arch,
You've obviously never dealt with an insurance company in the wake of a natural disaster. People who are adequately covered are often denied coverage by how damage is characterized. For example, my dad's house in Florida was destroyed by a tidal surge attributable to hurricane Ivan. Because he had no roof damage (just installed a bomber new roof), USAA characterized the damage as "flood" rather than "hurricane," with the difference (among many) being depreciated compensation under the flood policy rather than full compensation under the hurricane policy. Additionally, flood insurance did not cover dislocation expenses, as the hurricane policy would.
As a result, insurers were able to avoid properly compensating folks who were insured. That's where FEMA stepped in - helping people fucked by their insurers. Oh but wait, it's my dad's fault.
Don't forget, the insurance profit strategy is two-fold: (1) collect premiums; (2) deny coverage.