- Nov 26, 2011
- 123,644
- 57,252
- 2,290
Wow, a stupid class warrior.
Not all insurance companies make their profits from investments. Google "combined ratio" for more info on this.
Fool. You clearly don't know what combined ratio is. As I said, they take the margin they make between premiums and outlays (underwriting profit) and invest that.
Combined ratio is the amount of profit they get from investing the underwriting profit.
Carroll and others pointed out that the profit margins the health insurance companies report -- often below 5 percent -- pace some industries and lag behind many others.
"From a net margin basis, it's not that much," said Steve Shubitz, an analyst at Edward Jones. "The bottom line is any business needs to make money. That's why you're in business."
Carroll said this year's profit increases look especially large because of how poorly companies did last year, when their investment portfolios -- like everyone else's -- saw massive declines.
Take out the role investment income plays in earnings reports, he said, and you'll find earnings for UnitedHealth and WellPoint rose 7 percent and 4 percent, respectively, while Aetna's dropped 36 percent.
"It's a little mystifying why health insurance gets vilified for that profitability," Shubitz said.
http://abcnews.go.com/Business/health-insurance-profits-worth-outrage/story?id=9036632#.ULPsJIfBGRU
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