We’ve all read the “Record Profits” headlines so many times we don’t pay attention anymore. For that reason we decided to switch the headline around to say what this means to us, the people. Yes, the headline “Record High Prices and Low Claims Payment by auto and home insurers” is what this means. Coincidentally, addressing this serious problem is exactly the reason Injured Money was formed.
Our focus is to put insurance money where it belongs…in your pocket. You can help us do this simply by subscribing to our website.
The Data Showing Record High Prices and Low Claims Payment
The Consumer Federation of America (CFA), studied data released recently by the insurance industry and released a press release yesterday. The Director of Insurance for the CFA, J. Robert Hunter, stated in the release “The data make it indisputably clear that insurance companies are overcharging their customers in order to rake in huge profits.”
The release went on to identify several concerning trends for consumers or businesses that buy insurance. For most people that would be an auto or home policy, but the problem is much broader, including commercial insurance. The press release highlighted the following trends:
- Earned premiums were the largest in history at $478 billion. This is how we know we now have record high prices, that are showing no sign of flattening or going down.
- Pre-tax operating income was the third highest in history.
- Insurer’s net income since 2000 will exceed $530 billion.
- The combined ratio — think of this as the cost of doing business — will tie for the second lowest in history.
- The surplus insurers hold is a record $653 billion. In other words, they don’t need the money. Particularly in light of the fact they are reducing the risks they take by doing things such as refusing to write flood insurance, forcing the government to provide insurance for high risk situations.
Injured Money does not wish to deny insurers a fair profit, but this is outrageous profit. As the risk insurance companies assume has decreased, the profits they are reaping is increasing. That is not good for the citizens of the U.S. or our overall economy.
Consumers have the power to change this. New technology enables us to stop the record high prices and low claims payments. To do this, we need a large group of people who are interested in addressing the problem. All you need to do is sign up on our website (www.valchoice.com) to follow ValChoice. Signing up and sharing on social media will make you a driver of insurance reform.
For a copy of the full press release from the CFA, click here.
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