Insurance industry folks only, does your company make money off car insurance, or is it a loss leader?

Question

Insurance industry folks only, does your company make money off car insurance, or is it a loss leader?

Answer 1

Of course they make money.  They are a business.  Insurance companies collect premiums from customers. They pay out benefits to those customers who file claims.  They invest the premiums they collect.

Losses can be very expensive. You pay $1000 for Homeowner's insurance, it burns down to the ground, and your insurance pays you $250k!   Seems to me that the insurance company lost a lot of money for that risk.

You pay $1200 for auto insurance.  You total your brand new vehicle and the other party's new vehicle.  The total damage for both about $50k.  The other driver was seriously injured sustaining a fractured femur requiring surgery.  His two passengers were also seriously injured with similar injuries.  All three claims settle at your policy limit of $100k per person, but only after suit was filed and some litigation had to run it’s course.  The defense attorney’s expenses total $20k.  You were also injured and your PIP coverage paid you $25k for your medicals and lost wages.  Total paid out $395k for your paltry $1200 premium.

But, yes, if they properly underwrite, they can make a profit.

Answer 2

An Insurance company is a BUSINESS.  Of course they make money otherwise they wouldn't be doing it.

Answer 3

the insurance companies are in business to make monies and build skyscrapers.feel free to rip them off whenever possible.what comes around goes around.

Answer 4

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Answer 5

The company I work for makes a loss on motor insurance, particularly on young drivers, but we continue to offer it as when people take out motor insurance, we can then market other insurance such as life and savings, which is where the real money is, to them.

If there was money in car insurance, there would not be so many companies stopping selling it.

Answer 6

No.

If they didn`t make a profit they wouldn`t offer it. Simple.

They are no different to any other business in that respect.

Answer 7

We make money off of it, but maybe not how you think.

A site I've recommended in the past would be...

http://insurance.deal4-you.com

Hope that helps.