I've covered insurance companies for a number of years, and here's the rundown: - Like any other financial services company, insurers' primary concern is risk

I've covered insurance companies for a number of years, and here's the rundown: - Like any other financial services company, insurers' primary concern is risk management. In contrast, a retailer knows exactly what its profit margins are before the product is sold - its primary concern is to sell as many products as possible profitably. However, insurers and banks can sell infinite policies/loans so long as the price is low enough. They also don't know their margins for sure until the policy/loan is complete. - The average insurer makes more than half their profits from investment income. Most insurers are garbage at writing policies, with the P&C industry averaging around mid-single digit ROE in a year with average catastrophe losses. When I checked a few years ago, aggregate combined ratio (sum of losses & expenses divided by premiums) is in the high 90's percentage. - Loss costs are getting ridiculous these days (trial lawyers, social inflation), almost across the board, so you're seeing insurers start raising prices across the board. Add to that zero interest rate policy courtesy of our unaccountable central bankers, and insurers are forced to push premium hikes.