An Inconvenient Truth

[MTK]

I've never denied that insurance companies are in the game to make money, of course they are. They're a business and that is the name of the game. But are they any worse than anybody else? It's my belief that they're not.

[firstdown]

Originally Posted by Hog1

I just had lunch with my commercial insurance guy (who has done very well with it). He corrected me as I accused him, and the spawn like him of racketeering, profiteering, and wearing an earring. His contention is that the insurance co's are getting what they need to stay in the game.
Live to fight another day Matty.
Closer to the heart, he tells (which I know is true, as I am dealing with it) the insurance co's are pulling out of Florida because of the loss's and liability related to wind/flood damage. He is accustomed to ins co's beating down his door courting him to offer their product. Taking him on trips, long golf weekends, Dolphin tickets, etc. He says, that is GONE. Never hears from anyone like that. His opinion is the atty's are reaping the fruit of the land. Far be it from me to me to protect the atty's.
THEY are the BAD guy's

I've been in the business for over 20 yrs. and I have never had an ins. co. courting me to sell their products. I did have one take me to lunch but these trips and football tickets you talk of I have never seen this. I have seen the agencies courting the ins. co. to let them sell their products. The problem in Fl. is not the atty's its the premium v/s the risk that ins. co. are getting away from. A large Ins. Co. has to write at a good profitt for 15 to 20 years just to break even from one hurricane. They cannot charge enough premium to make up for the risk in FL and on top of that they are expecting an increase in hurricans in the years to come.

[Hog1]

And I never suggested that they should not make money. I own my own business, and have for many years. I am quite familiar with the concept of making money. There are large groups of people getting fat on the backs of the American public in the insurance business. To think otherwise is....silly. Basically, the people that cannot afford to, are footing the bill. In many ways, your held hostage. Have to have it, but cannot afford to. I do not agree with that concept. Who's diriving the problem? There is plenty of blame to go around.
I look at it similar to the Federal Government. Like a juggernaut, one that continues to spiral out of control. Giving lip service to the public in place of services, you would expect.

[FRPLG]

Originally Posted by Mattyk72

I've never denied that insurance companies are in the game to make money, of course they are. They're a business and that is the name of the game. But are they any worse than anybody else? It's my belief that they're not.

And I'd totally agree.

In a captalistic economy the name of the game is profit. It is the only true driving force behind business.

[Hog1]

Originally Posted by firstdown

I've been in the business for over 20 yrs. and I have never had an ins. co. courting me to sell their products. I did have one take me to lunch but these trips and football tickets you talk of I have never seen this. I have seen the agencies courting the ins. co. to let them sell their products. The problem in Fl. is not the atty's its the premium v/s the risk that ins. co. are getting away from. A large Ins. Co. has to write at a good profitt for 15 to 20 years just to break even from one hurricane. They cannot charge enough premium to make up for the risk in FL and on top of that they are expecting an increase in hurricans in the years to come.

The remaining companies are making a good run at it. State farm jacked my homeowners by 300%. I'm told that is a good deal in this market. A good deal has a different meaning in my mind. As Matty pointed out, some of this may be driven by fraudulent claims. I understand that............but I am innocent. Why am I paying for it? My original point is this, the health ins system is a BAD system. It works for those collecting the loot. Who's at fault? I don't know

[JoeRedskin]

Originally Posted by FRPLG

And I'd totally agree.

In a captalistic economy the name of the game is profit. It is the only true driving force behind business.

The problem in the insurance business is that standard market forces aren't always at work. The supply/demand market process assumes buyer and seller of equal resources and/or knowledge. In insurance, the sellers have huge advantages in both resources and knowledge. Even with multiple insurance companies, there are monopolistic forces at work. Given the competition between local and national companies, insurers can (and do) act in very anti-capitalistic ways (e.g. take losses in one market or policy type so that they can make it a cheaper product to undercut competition).

Insurance regulation is one of the oldest regulatory functions of government. There is a reason for that.

[firstdown]

Originally Posted by Hog1

The remaining companies are making a good run at it. State farm jacked my homeowners by 300%. I'm told that is a good deal in this market. A good deal has a different meaning in my mind. As Matty pointed out, some of this may be driven by fraudulent claims. I understand that............but I am innocent. Why am I paying for it? My original point is this, the health ins system is a BAD system. It works for those collecting the loot. Who's at fault? I don't know

I'd say in FL. fraudulent claims is a small part of the problem its the exposure that is the problem. With what your paying now for Homeowners Ins. the Co. are still and will be in a negative in that area for years and years to come and thats only if FL can go without any more hurricans. Its not that your guilty or innocent you are just paying for the exposure that FL faces. If you owned an insurance co. how much would you charge for a $200,000 dollar home? If its a total loss the Ins Co. could stand to lose Dwelling Cov $200,000, contents 140,000, additional living expenses 12months maybe 4,650 per month X12= 55,800 for a total of $395,800. That does not enclude the cost to house employess etc.. to handle the claims.

[That Guy]

Originally Posted by Schneed10

Trouble is nobody is going to do that with healthcare. If your father or mother or daughter or son needed surgery in a life or death situation, there's no price too high. You'd never reach a point where you'd say you know what, it's just not worth it, just euthanize my father.

that does happen in england in some cases.

i mean, yeah it's cruel, but if someone requires $200k-$1mill a day in care with a 5% of ever recovering (brain damage, full body paralysis, etc)...

[Hog1]

It should be an option available here as well. Many people are forced to "live" lives where actual life has ended years ago.
Calling Dr. Kevorkian

[firstdown]

Originally Posted by JoeRedskin

The problem in the insurance business is that standard market forces aren't always at work. The supply/demand market process assumes buyer and seller of equal resources and/or knowledge. In insurance, the sellers have huge advantages in both resources and knowledge. Even with multiple insurance companies, there are monopolistic forces at work. Given the competition between local and national companies, insurers can (and do) act in very anti-capitalistic ways (e.g. take losses in one market or policy type so that they can make it a cheaper product to undercut competition).

Insurance regulation is one of the oldest regulatory functions of government. There is a reason for that.

I see insurance Co. thats moving into an area that will cut their prices to pick up market share knowing that at some point that they will have to increase prices. I have seen them cut prices to pick up some of the market knowing that they will make money on other lines sold to te customer. They will also write policies in a strong market knowing that the customers may have a loss ratio higher than the premiums receivied but the INs. Co. will make money off the investment of the premiums. I have never seen them just take a loss to take market share from another co. but I guess it may happen. I just dont see why a company would want to grow off unprofitable business just to grow unless they are new to the area then that does happen.

[JoeRedskin]

Originally Posted by Hog1

The remaining companies are making a good run at it. State farm jacked my homeowners by 300%. I'm told that is a good deal in this market. A good deal has a different meaning in my mind. As Matty pointed out, some of this may be driven by fraudulent claims. I understand that............but I am innocent. Why am I paying for it? My original point is this, the health ins system is a BAD system. It works for those collecting the loot. Who's at fault? I don't know

<sigh> We get this one all the time. "Why are my rates going up, I've never made a claim."

Insurance 101 - You are part of a pool of insureds - that is the ONLY way anyone can afford to be insured, by pooling risk. Maybe you haven't made any claims, but people in your risk pool did and, in order to afford covering everyone in the risk pool, premiums have to increase to reflect the increased risk presented by the pool of insured.

[MTK]

Originally Posted by JoeRedskin

<sigh> We get this one all the time. "Why are my rates going up, I've never made a claim."

Insurance 101 - You are part of a pool of insureds - that is the ONLY way anyone can afford to be insured, by pooling risk. Maybe you haven't made any claims, but people in your risk pool did and, in order to afford covering everyone in the risk pool, premiums have to increase to reflect the increased risk presented by the pool of insured.

I prefer the "We raised your rate because we hate you" explanation.

[MTK]

A little off topic here but the best advice I think anyone can give regarding insurance is to read your policy. Know exactly what you're buying, ask a million questions up front if you have to. I've seen so many instances of people simply not understanding their policy and their coverage limits and they want to blame the insurance company for their own ignorance. So again, read your policy!

[Hog1]

The insurance model is a simplistic model, and one easily understood. Basic Economic laws of supply, demand, and profitability fall in that category as well. To suggest that because something is legal, that it is also acceptable is incorrect.
Millions of Floridians have paid YEARS of premiums without making a claim (even though many could have). They have been rewarded with cancellation notices in the millions in this state, with NO good alternative (if any alternative) in sight. The norm seems to be a 500% increase in homeowners policies for those fortunate enough to retain one. What the insurance companies have done is........legal. That does not make it right. The action is easily understandable. The action is not easily palateable.
However, that was never my point.

My only real point is in the Health Ins market. That point is, that it is rife with ambiguity, and predatory sales techniques. Between the insurance companies, the physicians, the hospitals, etc, the truth of a matter can no longer be determined. Ask a question to all concerned, get numerous different answers. Conclusion....................it's a mess

[JoeRedskin]

Originally Posted by Mattyk72

I prefer the "We raised your rate because we hate you" explanation.

Well, that is the REAL reason rates go up. The fine print on those notification letters actual says "Muhahahaaaa" but you need a magnifying glass to read it.