In article , jim rozen
wrote:

In article , pyotr filipivich
says...

Maybe that's what your insurance company does, but the ones I'm dealing
with tend to try to not only cut costs, but put the "idle" cash to work
making some money for the company.

Define "putting to work" please.

In this case a casual inspection of the process reveals
the companies take the 'extra' money and invest it. If
the investments do well, they post extra profits and
everyone gets a bonus.

If the investments bomb then the companies say 'ooh,
we're "doing" poorly so we have to raise rates.'

During the internet boom of 1996-2000, the insurance companies
participated in the stock market and made lots of money. Because they were
hauling in lots more cash than they were paying out, they started lowering
rates to steal customers. Naturally, the other insurance companies did the
same. When the market went bust, all that extra income disappeared and the
insurance companies started raising rates.

(This is only a partial explanation of recent insurance rate increases,
but it's a large part of the reason for the increases.)

--
Jedd Haas - Artist
http://www.gallerytungsten.com
http://www.epsno.com