There is no solution, and that is a good thing! The only “solution” policymakers are willing to discuss at the moment is the two-state solution, which is completely unacceptable, since it would involve the permanent ethnic cleansing of Jews from a large swath of our historic homeland.
Eventually, a solution will come. (For example, Jordan could be overthrown by Palestinians, who are 80% of the population, and then go to war with Israel and lose, with PA Arabs fleeing to Jordan or Egypt to escape the violence of the conflict.) Only Hashem knows when.
Other than the Second Intifada, the amount of lives lost from terrorism has been minimal. Even including terrorism, the Israeli murder rate is less than that of the US. Their life expectancy is higher, traffic fatality rate is lower, intermarriage rate is many times lower, suicide rate is lower, etc. Overall, it is a better place for Jews to live. Wars with large numbers of casualties have not occurred for decades.