will insurance companies be subsequent asking for federal bailout? ?
in california, after ra billion dollars of damge due to wildfires? will this cripple industry?
Answers:
Yes, just like Katrina crippled my homeowners insurance hurricane coverage. Now I own to pay nearly $2,000 yearly premium to TWIA to cover me. I've already collected over $7,000 for hurricane dolly. It is sagacious to keep insurance no matter how much it costs. A hurricane or windy fire can leave you homeless. The companies will need to verbs in CA just approaching we did in TX and other coastal States.
Insurance companies are already facing tough times like the rest of the financial sector. The just good thing is the bulky amount of regulation, which virtually controls all that an insurance company can do, starting from the kind of business, the rates it charges, the rules to underwrite, the investment it can bring in and much more. Even then, not everything is full proof and we have see the situation which arose with AIG (though their losses where not next to insurance business)
To answer your question, insurance companies have already be looking for bailout. AIG has received and there are few more within queue. Hartford is eagerly looking for some money. But this is not only because of the impact of California fires, or articulate Ike or Gustav. It’s much deeper.
1. Insurance companies make money out of the investment it makes on the premium money collected. With huge investment losses, they are too brass deficit.
2. Regulators require them to have a minimum surplus to write more business. The losses are forcing them to not be able to write more business
3. The huge catastrophic losses (there own been 6 major catastrophic events this year within US already) takes a heavy toll on insurance companies and reinsurers (reinsurance companies insures the insurance companies for their business)
In the shorter run, it would be going to tighter rates for the consumers & lots of mergers and acquisitions buy large insurers. But by and big this industry would be less impacted than say mound and other financial sectors.
Source(s): I am a business consultant with US Insurance flea market.
Insurance companies are smart... real smart. Insurance companies allocate money to fix problems that rise and adjust their premiums to compensate. Essentially, those that salary insurance are paying the amount that the company needs to pay the solution.
Those that dont recompense, dont get insurance, so insurance companies dont pay for that.
So no, insurance companies should not be artificial by current market problems.
AIG already accepted almost a hundred billion. Most homeowners consent to their premiums lapse due to failed economy so they will take on the burden by being dumb we the taxpayer will also pay profusely of the cost due to the state of emergency that was declared
Related Questions:
Answers:
Yes, just like Katrina crippled my homeowners insurance hurricane coverage. Now I own to pay nearly $2,000 yearly premium to TWIA to cover me. I've already collected over $7,000 for hurricane dolly. It is sagacious to keep insurance no matter how much it costs. A hurricane or windy fire can leave you homeless. The companies will need to verbs in CA just approaching we did in TX and other coastal States.
Insurance companies are already facing tough times like the rest of the financial sector. The just good thing is the bulky amount of regulation, which virtually controls all that an insurance company can do, starting from the kind of business, the rates it charges, the rules to underwrite, the investment it can bring in and much more. Even then, not everything is full proof and we have see the situation which arose with AIG (though their losses where not next to insurance business)
To answer your question, insurance companies have already be looking for bailout. AIG has received and there are few more within queue. Hartford is eagerly looking for some money. But this is not only because of the impact of California fires, or articulate Ike or Gustav. It’s much deeper.
1. Insurance companies make money out of the investment it makes on the premium money collected. With huge investment losses, they are too brass deficit.
2. Regulators require them to have a minimum surplus to write more business. The losses are forcing them to not be able to write more business
3. The huge catastrophic losses (there own been 6 major catastrophic events this year within US already) takes a heavy toll on insurance companies and reinsurers (reinsurance companies insures the insurance companies for their business)
In the shorter run, it would be going to tighter rates for the consumers & lots of mergers and acquisitions buy large insurers. But by and big this industry would be less impacted than say mound and other financial sectors.
Source(s): I am a business consultant with US Insurance flea market.
Insurance companies are smart... real smart. Insurance companies allocate money to fix problems that rise and adjust their premiums to compensate. Essentially, those that salary insurance are paying the amount that the company needs to pay the solution.
Those that dont recompense, dont get insurance, so insurance companies dont pay for that.
So no, insurance companies should not be artificial by current market problems.
AIG already accepted almost a hundred billion. Most homeowners consent to their premiums lapse due to failed economy so they will take on the burden by being dumb we the taxpayer will also pay profusely of the cost due to the state of emergency that was declared
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