More or less buried in the massive debate over what our health care system should look like is a provision to create a national long-term care insurance program. The Community Living Assistance Services and Supports (CLASS) Act would allow people to pay an average $65 a month and, after five years, be eligible for between $50 to $100 a day in benefits. Insurers oppose the CLASS Act — clearly, it would cut into their sales of long-term care insurance, which haven’t been all that great to begin with. Other criticisms of the act: The government doesn’t need to be expanding programs even further than it already is, and low benefits would give people a false sense of security.

While $100 is better than nothing, I can tell you from experience that it doesn’t cover very much. More

My daughter recently reached a dubious milestone in her life: She received her first credit-card solicitations in the mail. “A great rate is just the beginning …” read one of the offers, which were targeted at college students. Problem: My daughter is not a college student. She’s 12 years old.

My first reaction was to be angry at the mean, incompetent credit card companies trying to lure my tween into a life of debt. But as often is the case with parenting, and with finances, the story is more complicated than that. More

The cost of insuring your houses and your cars is going up. This shouldn’t be much of a surprise, considering the billions of investment losses insurance companies have taken since the market cratered last year. After all, insurers’ profitability depends on the returns they expect from investing your premium dollars.

Except, in the case of property insurers, investment losses aren’t really the problem. Nope, it’s the weather.

Last year, property/casualty insurers actually made money on investments. Sure, only about half as much — $31.4 billion — as the prior year, but still, not bad. It was the underwriting side where they got hammered. Insurers paid out $21.2 billion in claims more than the premiums they collected. That’s a huge swing from a $19.3 billion gain in 2007.

The trend continued in the first three months of 2009. The property/casualty business had $3.7 billion in investment gains (down from $12.4 billion the year before.) But insurers paid out $2.5 billion in claims for all the cars, homes and buildings damaged by fires and storms — four times more than they had in the first quarter of 2008 — according to ISO and the Property Casualty Insurers Association of America.

“Hail, tornadoes — we haven’t escaped a disaster in the last 18 months,” says Jeff Dailey, president of Farmers Insurance’s personal property and casualty business. “We’re having to take premiums up substantially.”

The silver lining, such as it is, is that you don’t have to worry about your property insurer going out of business. Even with losses — overall, after taxes, the industry lost about $1.3 billion in the first quarter — P/C insurers have $437 billion available to pay claims. That’s mostly because P/C invested more conservatively, and more short-term, than life insurers, many of whom got too aggressive with stocks and things like Fannie Mae and Freddie Mac bonds. It’s also because of 2006 and 2007, when insurers pocketed gangbuster profits. “Insurers went into the financial crisis better capitalized than they’d ever been,” said Robert Hartwig, president of the Insurance Information Institute trade group.

It would be nice if insurers used some of those record profits to give us policyholders a break from rising premiums, especially because consumer groups like the Consumer Federation of America say companies earned those profits in part by overcharging us, cutting coverage and underpaying claims.

But P/C insurers say continuing reports of climate change and wacky weather make them nervous about sustaining further claims losses from the catastrophes to come. On top of that, while the market turmoil didn’t decimate their balance sheets, it did make insurers more cautious about the amount of money they can expect to earn from investments. “Insurers only have two sources of revenue, investments and premiums,” Hartwig says. “To the extent we can offset only a smaller share of losses with investment returns, … rates are going to have to pick up the slack.”

In fact, he says, since 1978 P/C insurers have made money on underwriting (premiums minus claims and expenses) in only three years — 2004, 2006 and 2007. Going forward, he says, the industry may be returning to the post-Depression era of 1940-1959, when insurers made profits on underwriting in all but two of those years — because the Depression taught them they couldn’t rely on the markets to make up the difference.

There doesn’t seem to be much consumers can do about this. We have to insure our homes and our cars. Yes, we can shop around (although, as someone who lives in a hurricane-plagued coastal state, the idea of “shopping” for home insurance is a joke — I’m lucky if I can get a policy from a private company at all). Yes, we can increase our deductibles to keep costs low. Dailey suggests choosing an insurer with operations spread around the country, to mitigate the financial damage one giant storm can do to its profit-and-loss statement. But seems like this is just one more price increase that we insurance customers have to suck up.

Real estate appraisers must be feeling pretty picked on. A new Center for Public Integrity report takes on crooked appraisers who, after being banished from their own business, continue suckering unwitting homeowners as real estate agents and as bosses of unregulated appraisal contract firms.

The Realtors and homebuilders are on their case too, claiming appraisers are costing them business by lowballing valuations. (Our readers' comments on that post make for a fascinating debate over what's right or wrong with the appraisal process nowadays.)

There’s been no shortage of bad actors at every phase of the real estate deal, so I wasn’t surprised by the Center for Public Integrity’s report.

The debate over how homes are valued, though, is a big deal because it gets to the heart of why the country’s housing market isn’t recovering very quickly. I live in South Florida, which saw some of the nuttiest increases in home values in the country during boom times and now is suffering through one of the worst real estate markets in the nation. For a while, absolutely nothing was selling; even now, just about the only thing moving are foreclosures and short sales. So forget looking for comparable sales, or “comps” — if you find a recent sale in your neighborhood at all, it probably will be a bargain-basement foreclosure. Go back further and it will be an inflated boom-era deal.

This is the kind of thing driving lenders batty, because even those that want to make loans fear they’ll bet wrong and end up with more junk. For that matter, it’s also driving buyers crazy — is the house worth this much? Or if I wait, will I miss the bottom? And sellers are tearing their hair out, too, wondering why appraisers can't recognize the value they see in their own home.

Appraisal is so much trickier in a declining market, says Knoxville, Tenn. appraiser Leslie Sellers, president-elect of the Appraisal Institute trade group. Anything selling today might involve incentives — the seller pays closing costs or (yes, he has seen this) throws in a John Deere tractor. Maybe the sellers were 10 days from foreclosure and so took any old offer. A good appraiser will spend the time to ferret all this out, Sellers says.

But many of the good appraisers have gone, say industry veterans, tired of getting yelled at by Realtors to fudge values or sick of getting squeezed on the fees. Since the well-intended Home Valuation Code of Conduct (HVCC) took effect, they say, appraisal management firms have become more like appraisal mills, churning out values cheaply and quickly — and often, wrongly. “It’s a race to the bottom,” says Ted Faravelli, executive director of the California Association of Real Estate Appraisers.

On this, the professional appraiser groups and the Realtors agree. But what’s the solution? HVCC isn’t going away, and probably shouldn’t. Will Congress have to act, or is this just another phase we have to work through to get the deals cranking again?