oh shoot

"SteveB" wrote: (clip) Pick out the ten tallest buildings. A high percentage of them are insurance companies. Does that tell you anything? ^^^^^^^^^^^^^^^^^ It tells me that insurance companies have to invest the money that comes in, in order to be able to cover the claims that are going to come in.

It tells me that there must be a pretty good profit in the insurance game. Pardon me, trade.

Steve

"SteveB" wrote: It tells me that there must be a pretty good profit in the insurance game. Pardon me, trade. ^^^^^^^^^^^^^^^ I knew what you were driving at. But do you see what I was getting at? Insurance companies can't make a profit if they just pay the losses with the money they take in. They have to invest the premiums at interest, so the expected losses still leave them a profit.

Incorrect, they can and do make a profit by charging premiums that exceed the predicted losses. Their actuaries spend plenty of time figuring out how much a particular coverage will cost in claims and they price the premiums to collect that much plus whatever profit they can get away with. Any investment profits just ice the corrupt cake. And premiums are regularly increased to offset losses in a completely unrelated area.

Pete C.

"Pete C." wrote: Incorrect, they can and do make a profit by charging premiums that exceed the predicted losses. (clip) Any investment profits just ice the corrupt cake. (clip) ^^^^^^^^^^^^^^^^ If I don't argue with you, please don't mistake that for agreement.

And a pretty good profit when you can build some of THE biggest tallest buildings in a large city.

And a pretty good scheme, too. Here, let me hold your money, and if you have a loss, you can try to get some of it back.

Hmmmmmm. Let's see. There's the deductible. The exclusions. The preexisting conditions. The prudent person clause.

OOOOPS. This shows you owe US money!

Steve