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Originally Posted by Harry Lime
That's really pinpointing one small area in the province where the result for insurance companies weren't thunderous profits. They absolutely made up the difference elsewhere in the province.
Also, this year there wasn't a huge hailstorm, so insurance went right back to making money hand over fist in that area.
Also, insurance isn't simply home for these companies, so they continued to make profit in other avenues, like auto.
As taxpayers, insurance is a business to get into, even if it's to gouge everyone at the same rate as private business, at least the profit would go to the province.
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It doesn't read like they did...
I may have been too selective in the parts I quoted (probably should've quoted the whole article and highlighted the points, but here we are...), but if you read the article, the 97% payout ratio seems to refer to the entire province across all insurance sectors - at least, that's how I read it... It goes on to mention that payout rates (again, reading as across all sectors) have increased 74% in the past 5 years and
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23 out of 25 major insurers in the province lost money last year, with an average loss of 20 per cent of premiums collected. Six companies saw losses in excess of 40 per cent.
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Again, I hate insurance companies as much as the next guy, but can also see that the numbers quoted in the article don't make for a sustainable business and rate increases aren't surprising...
The microcosm of the NE and the insured damages caused by hailstorms puts a bigger emphasis on the broader situation and everyone is left paying for it.
That said, I'd be all for a provincial insurer.