WSJ: Gustav Threatens Profits Of Insurance Companies

[Robbien]

Source: Wall Street Journal

As Gustav sails toward the Gulf of Mexico, its impending landfall threatens to swamp the profits of property-and-casualty insurers.

Should the storm cause widespread damage, insurers could be left facing costly U.S. claims even as the subprime-mortgage crisis has battered their investment portfolios . . .

While U.S. property-and-casualty insurers are flush with capital to pay claims -- having "somewhere north of $500 billion," according to Moody's -- heavy damage from Gustav or other storms could hurt insurance-company investors.



Read more: http://online.wsj.com/article/SB121997069987781925.html?mod=googlenews_wsj

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But on the bright side:

For insurers with modest exposure to Gulf Coast property, however, a windy storm season could ultimately drive up premiums, which would pad future profits.

[Fovea]

1. I will stay up all this weekend,

wringing my hands for insurance companies.

Maybe it will avoid everyone else, and hit that old Bush bitch.
If only.

[Newsjock]

2. I thought for sure this was a headline from The Onion

Then I realized it was not. :(

[Robbien]

4. A prominent newspaper publishing this type of story boggles the mind

Everyone knows the insurance companies are thinking this and have run their models on probable losses, but it is hard to stomach that a paper such as the WSJ would be publishing this story at the very same time people are sitting in their homes or shelters hoping and praying they will come out of this alive.

[merh]

3. Are you kidding me? The federal government bailed them out

after Katrina, the grant programs was the government bail out, your tax dollars paid the claims.

They paid me a token amount and denied the rest claiming surge (flood) took my house. Now, 3 years later, my premiums have tripled despite the fact that they paid me nothing but that token amount and despite the fact I continued to pay my premiums for 28 months though I had no home to cover.

What can we do, pass legislation that makes it illegal for these companies to go public and have investors? They claim they have to protect their investors so if we take them out of the picture, will they then abide by their agreements with the insurance policy holders?

And now I could face the same battles and struggles - I'm fucking tired.

:(

[radfringe]

7. correction - WE bailed them out

it's OUR money (via taxes) that bailed them out

[JeanGrey]

8. We bail out everyone, don't we? The Insurance Companies,

The Banks, The Airlines, The Mortgage companies, and on and on. What risk when you have the taxpayer to milk?

[aquart]

5. Yah. That's the big worry.

Jesus H. Christ.

[Connonym]

6. So much for the notion that insurance is a game of risk

Everyone who pays a premium and never collects loses. Why does the insurance company always get to win? Doesn't guaranteeing a certain win on their part sort of imply racketeering?

[liberal N proud]

9. Nothing threatens profits of Insurance Companies

They either raise their rates on everyone else or drop those customers who are high risk. Or both.

[marmar]

10. Cue the violins......

:nopity: :nopity: :nopity:

[The Wizard]

11. I have it on good authority

that Gustav is a secret communist agent working for the Marxist Muslim Obama. Gustav's mission is to make John McCane leave the convention and do a flyover of the storm damage, thus taking the momentum from the Republican convention and handing the election to the Democrat Party.
Ever since the Democrat Party was taken over by the socialist/communist Roosevelt, they have pandered to the coloreds. The Democrat Party has worked to make sure minorities have equal rights. Now they think the government should help people and tax corporations at a fair rate.
If we're lucky, Gustav will finish the job Katrina started and real estate speculators will be able to buy up properties at ten cents on a dollar.
Gustav is not the kind of guy I want to have a beer with.