05-10-2003, 09:39 AM
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Senior Club Cobra Member
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Join Date: Mar 2001
Location: Seattle, WA,
Posts: 1,389
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Not Ranked
Fellas,
Insurance companies are jacking rates for every kind of insurance acrcoss the board.
A long time freind and career insurance guy ( ceo of national company ) sat at the bar and explained insurance to me years ago;
If insurance companies had to pay claims out of premiums they would go broke in a couple years.
Insurance companies are only in the insurance business as a secondary consideration. They make their money, and pay a portion of claims from the returns they get in wall street investing particularly loaning to large commercial real estate.
Your insurance premium has been subsidised by the stock market for the last decade.............and you know what happened to the stock market..........now all these companies have to pay claimes from premiums.....and they were not prepared to have to do that,.. so.............................
every account is now going to get scrutinized, every loser is going to get canned, and every marginal market is going to get jacked ...period.
On the brighter side ,...as soon as they can start being highly profitable in the stock market again , they will be out there scrambling and competing for our insurance / investment dollars and rates will drop.
Me...? I paid an extra $12.000 this last year to cover my bussinesses alone .
Karl
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Foolish consistancy is the hobgoblin of tiny minds
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