In article , Gary Coffman says...

Premium income is steady, payouts aren't.

Here I was restricting my discussion to health
insurance, whereas you are taking the broad
view. For my case, things are a good deal more
steady. For the overall picture of course you
are correct when all forms of insurance are
included.

The economic crash after 911 wiped out a lot of those investment
gains, so we've recently been seeing sharply rising premium rates
because there is no longer enough investment income to subsidize
rates, and because the reserves have to be rebuilt to cover future
spike events.

So the deal is, the insurance companies invest the money and
then give it back when you make a claim. Sounds to me like
a person could do exactly the same thing - invest their money
and then get the ROI on it, and use the principle for any
large hospital bills.

I guess what I'm saying is, if I want health insurance, I
go to an insurance company. If I want to invest, I go to
a broker.

Jim


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