Skip to content
Clinging to the frozen waterfall with ice ax and crampons, Charlie Sassara watched the rock fall. It was June of 2002, the first day of an ascent of Mt. Augusta's north face, a frozen lattice of rock and ice stretching 14,070 feet into the Canadian sky near the Alaska border.
Sassara's partner, Jack Tackle, had just clambered over a snow-crusted notch 25 feet overhead. As Sassara watched the briefcase-sized rock falling, he yelled out.
Earlier, just hours into their planned three-day ascent, Sassara had felt a warm wind blowing from the Yukon carrying the smell of burning timber. The ice around them had begun melting, destabilizing boulders.
As the rock disappeared behind the mound Tackle had just crossed, the belaying rope in Sassara's hands went taut. Tackle, struck by the rock, was knocked from his position and fell. His eyes were wide with shock. Blood streamed from a deep cut running from his scalp and throat to his right shoulder. He hung limp in his harness, spinning in midair.
Catastrophe is always a possibility when climbing, and Sassara and Tackle were cautious. For the Mt. Augusta climb, they studied aerial photographs, kept a satellite phone at base camp and had rescue insurance in case disaster struck. But in spite of their precautions, neither man was on this mountain to feel safe.
Like solo sailors venturing into the Southern Ocean, climbers are seduced by risk. The desire to push to a summit or scale a rock face is so strong that they consciously or subconsciously minimize safety precautions drilled into their brains. It's how adventurers can sabotage themselves, and some scientists believe it is just part of the game. But for the insurance industry, it's no game at all. Between calculated risk and reckless decision-making lies the dividing line between profit and loss.
"Can you move?" Sassara asked. Tackle screamed as Sassara pulled him onto the footlong ledge where he stood. Blood covered Tackle's head.
"Only my right arm," said Tackle. The rest of his body was paralyzed. The skin was hard where the rock had struck; he might be bleeding internally. Both climbers suspected a broken neck and spine.
Moments like this keep men like Ken Schulteis up at night. He is president of Global Underwriters, and his company writes more than 10,000 insurance policies a year for people climbing mountains, racing cars and stepping out of their predictable routines.
From his Cincinnati office, Schulteis interviews adventurers and tries to determine who is a good risk. When a client recently approached him to insure a ski trek across Antarctica, he leaned across a desk buried under files and gazed out his window onto rolling hills.
"What's your itinerary?" he asked. The questions come easily; Schulteis is a climber himself. "Do you have a guide? Why do you want to do this?" And finally, "Have you told your family you might die?"
Since the 17th century, insurance agents have been the foremost experts on risk. In 1688, Edward Lloyd opened a coffeehouse on London's seafront popular among underwriters, men in powdered wigs with mathematical minds and steely constitutions who offered to compensate owners if their boats were lost at sea.
At the time, the price of insurance was based on gut-level estimates of a captain's skill, the age of the vessel and the season. It was a combination of instinct and fact that eventually formed Lloyd's of London, one of the world's largest modern-day insurers of round-the-world balloon trips, solo ocean crossings and mountain ascents.
While computers, better data and a greater understanding of the theories of probability have made calculating prices for some insurance policies — such as automobile and life — less guesswork, calculating the likelihood of infrequent events like Tackle's accident is nearly impossible.
"I kind of come up with prices for these policies by the seat of my pants," Schulteis explains. "It's kind of fun. And I haven't lost money on one yet."
Slim hope of rescue
For the next few hours, Sassara treated Tackle for shock, bolted and tied him to the wall, wrapped him in a sleeping bag and gave him water and food. But he knew if help didn't come soon, his partner would die.
"It's OK," said Tackle. "You can go."
Sassara looked down. The warming air had partially melted the ice covering the vertical black rock. Sassara did not have enough equipment to secure his descent. If he fell, there would be nothing to stop him, but he had no choice.
Their only chance of rescue was 400 miles away at the Kulis Air National Guard Base in Anchorage, where an elite group of mountain rescuers waited for such calls. Alaska spends $170 million a year on bases and supplies for rescuers. A single retrieval, involving airplanes, helicopters and hundreds of man-hours, can cost as much as $75,000. Throughout Canada and the United States, park fees and taxes pay for search and rescue teams. When climbers go outside North America, they often purchase private insurance from companies like Global Underwriters and Lloyd's.
While having rescue insurance makes sense, the wisdom of offering such protection is less clear. "The more I learn about people, the more I worry about selling insurance," says Schulteis. "There's a possibility that insurance encourages dangerous behavior. I always ask myself: Will selling a sane person insurance make them take insane risks?"
The answer goes straight to what behavioral scientists have known for years. In the 1950s, insurance companies began studying a disturbing trend: People who owned car insurance were more likely to be killed in automobile accidents than those who didn't have coverage. Studies today indicate that mandatory insurance laws have caused a 6% to 10% increase in traffic fatalities since 1970.
The conclusion is simple: People become more reckless when they feel safe. Economists who study human behavior call the problem moral hazard. As opposed to physical hazards — wind, rain, acts of God — a moral hazard occurs when a deliberate choice is made. Insured drivers choose to go faster when they know their cars will be replaced after an accident.
"People start taking small risks," says Schulteis, "figuring rescue is nearby. But gradually those risks become deadly."
To get around such behavior, insurers try to find ways to trick the psyche. While Schulteis insures the safety of his clients, he also emphasizes to them that safety is out of reach.
When Global Underwriters charged the Antarctica skier $20,000, the company made him carry tracking devices and check in every night. Each time he called home, he was reminded that the only rescuers were more than 1,000 miles away in southern Chile.
"Otherwise people need to push themselves to the edge of risk," says Schulteis. "Once someone sees the safety net, they'll always want to walk to its edge."
Cliffs turning to foam
Sassara began descending, moving slowly down the blue ice. He had been awake for more than 30 hours. Ice began swirling around his head. After climbing for an hour, he slipped, but the rope caught him. Fatigue was taking its toll.
Perched above the final ice cliff, he looked down and swung his ax into the face. Nothing held. The warm air had melted the cliff to the consistency of foam. The only way to descend was to slide 130 feet down.
If the ice collapsed around him, he would die.
"Just think about the phone," he told himself. "Think about rescue."
From the beginning, Sassara knew the satellite phone was his only hope, but it was 3,500 feet down and two miles away. Although it was small, both men had refused to carry it.
"Having a phone at base camp is the only responsible thing to do," Tackle said after extended hospitalization for a broken neck and spine. "But it stays there. If you think help is only a phone call away, you start making decisions using the wrong criteria. Each decision stops being so important. Why bother to climb?"
The decision to leave the phone at base camp illustrates the complexity of moral hazard. When researchers began investigating how insurance changes people's behavior, they discovered that some people take risks regardless of the difficulty of the rescue, and typically these people are among the most skilled.
From atop the ice cliff, Sassara might rethink his decision to leave the phone behind, but from Schulteis' point of view, the thought is irrelevant: Some people are addicted to danger. Unfortunately they also have the most impressive résumés. Economists call the problem adverse selection: Those who most need insurance are typically the people Schulteis least wants to insure.
So how does an insurance agent separate cautious climbers from daredevils? There is no test.
"I only want to insure highly qualified climbers," explains Schulteis, but "to become qualified you have to crave danger. People think they're being safe and then fool themselves into taking bigger and bigger risks, since that's why they're there in the first place."
A fast trip down
As Sassara sluiced down the foamy ice, he began falling faster until the blue crystals and clumps of snow blurred. He started to sink. The world became whiter and whiter as the mountain slowly swallowed him. Years earlier he had nearly died in an avalanche on Mt. Johnson, tangled in his own rope, suffocating in the snow.
He began to swim, arms and legs flailing, until suddenly the ground became firm. He had reached the glacier itself. A burst of relief and thankfulness washed over him as he stood shakily. The tent and phone were only a mile away.
If asked, Sassara would say he had no choice. He risked this descent to save Tackle's life. But if pressed, he might also admit to a certain thrill. Why does danger hold such allure?
Prior to the 1990s, most psychologists believed that happiness, safety and pleasure motivated most decisions. But a small and influential group of researchers — including Daniel Gilbert at Harvard, Tim Wilson at the University of Virginia and George Lowenstein at Carnegie Mellon University — are not so certain.
"People don't only want to feel happy, they want to feel alive," explains Lowenstein, who has spent his career exploring the science of risk-taking and decision-making. "Part of feeling alive is having a range of emotions. Taking risks brings a lot of lows but also some extreme highs."
The question is not just what course leads to happiness but what course is unpredictable and challenging as well. Routine, for many, is the enemy of authentic emotion.
"When an event becomes ordinary, we lose our pleasure," explains Wilson. That's why intense experience is most exciting the first time you have it. Your mind has yet to adapt to it.
"The great thing about climbing is its anarchy," Tackle says. "You're never certain what is going to happen next, so you're never so happy to be alive."
The fateful phone call
As soon as Sassara reached base camp, he called his wife.
"Siri, Jack is gravely injured. You have to call the rangers
. Tell them to send a helicopter right now."
Within hours the rescue team at Kulis was in the air. Four hundred miles later they reached Tackle, bivouacked on the side of Mt. Augusta where Sassara had left him. The helicopter moved into position, its rotors 15 feet from the mountain. The pilots began dumping fuel to stabilize the craft.
As soon as a rescuer reached Tackle, he attached a wire to the climber's harness, and both men were pulled aloft. A circling C130 was ready to refuel the helicopter.
From his tent 3,500 feet below, Sassara listened to the commotion over the satellite phone, uncertain of the outcome.
"They've got him, Charlie," his wife said. "Jack is safe."
He put down the phone and climbed into his sleeping bag. Then he looked at the climbing gear surrounding him and began to weep.
Times staff writer Charles Duhigg can be reached at charles.duhigg@latimes .com.