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>> For every dollar in home and auto premiums they collected last year, insurance companies paid an average of $1.10 in claims and expense I've seen this befor

>> For every dollar in home and auto premiums they collected last year, insurance companies paid an average of $1.10 in claims and expense I've seen this before. What I haven't seen is this compared to their other revenue streams. Insurance companies are quick to total out a vehicle and then insist on getting ownership of it. They must be selling them to someone.

lotsofpulp 3y ago
If they were profiting from that, then it would show up as higher profit margins in their audited financials. So 99% of the time a business’s “greed” gets written about, and there are publicly listed businesses that can be referenced, notice that no one links to the increasing profit margins to prove the greed. Because the claim is usually false.
- FireBeyond 3y ago
  > So 99% of the time a business’s “greed” gets written about, and there are publicly listed businesses that can be referenced, notice that no one links to the increasing profit margins to prove the greed. Because the claim is usually false. Hmm: > Progressive gross profit for the quarter ending December 31, 2023 was $2.665B, a 127.67% increase year-over-year. > Progressive gross profit for the twelve months ending December 31, 2023 was $5.547B, a 224.14% increase year-over-year. > Progressive annual gross profit for 2023 was $5.547B, a 224.14% increase from 2022. > Progressive annual gross profit for 2022 was $1.711B, a 63.64% decline from 2021. > Progressive annual gross profit for 2021 was $4.707B, a 38.19% decline from 2020. Source: https://www.macrotrends.net/stocks/charts/PGR/progressive/gross-profit https://www.macrotrends.net/stocks/charts/PGR/progressive/gr... GEICO: > 2023 pretax underwriting profit of $3.6 billion > 2023 underwriting profits for the remainder of primary operations coming in three-times higher than 2022 and more than double 2021, with written premiums growing 24.1 percent to $3.5 billion. > P/C reinsurance operations adding another $2.0 billion in pretax underwriting profit. Source: https://www.carriermanagement.com/news/2024/02/25/259036.htm https://www.carriermanagement.com/news/2024/02/25/259036.htm
  - lotsofpulp 3y ago
    All of those figures are irrelevant. Profit margin (sustained) is a clear signal. https://www.macrotrends.net/stocks/charts/PGR/progressive/profit-margins https://www.macrotrends.net/stocks/charts/PGR/progressive/pr... https://www.macrotrends.net/stocks/charts/ALL/allstate/profit-margins https://www.macrotrends.net/stocks/charts/ALL/allstate/profi... Nominal amounts are never relevant for this discussion, and it is trivial that nominal profits would keep increasing since the currency is worth less over time. Otherwise, a business would eventually go out of business due to not having sufficient cushion.
    - FireBeyond 3y ago
      Progressive: so, generally averaging about 9% quarterly profits, then? With a dip to 1.7% for three quarters and then steadily increasing by 25% QOQ since then? (1.6% for Q1, 3.1% for Q2, 4.6% for Q3, to 6.1% for Q4). Progressive's sustained profit margins are doing just fine, other than a relatively brief blip where they only managed ~$2B profit in 3 quarters while inflation and the economy was suffering heavily throughout the country? Allstate's issues have as much to do with their overly aggressive stock buybacks in the last couple of years. "Allstate's auto insurance profit margins were best in the industry until about 18 months ago". "A report by Crain’s Chicago Business said Allstate spent $2.5 billion on share repurchases in 2022". "“We believe it's prudent for Allstate to pause its buyback, leaving capital in the (insurance subsidiaries) while underwriting results recover, especially as inflationary impacts on severity (replacement costs, medical, legal) are still concerning,” Greenspan said in a report titled “Stop the Buyback” last October." "Allstate is the insurance industry's most aggressive buyer of its own stock. It has repurchased 789 million shares at a cost of $42.8 billion since 1995, while issuing 154 million shares, according to its SEC filing." Continuing to push for stock buybacks as costs rise, and continuing dividend payments are failings of its own making.
      - lotsofpulp 3y ago
        I have no idea what numbers you are talking about. Progressives’s profit margins are 4% to 8% outside of 2018 to 2021. Currently under 5%. And dividends/buybacks have nothing to do with profit margin. Those are not expenses, so that money is included in profit (aka net income). From which profit margin is calculated. Revenue - expenses = profit. Profit / revenue = profit margin. Which is the same as net income / revenue = net (profit) margin

lotsofpulp 3y ago

If they were profiting from that, then it would show up as higher profit margins in their audited financials. So 99% of the time a business’s “greed” gets written about, and there are publicly listed businesses that can be referenced, notice that no one links to the increasing profit margins to prove the greed. Because the claim is usually false.

FireBeyond 3y ago
> So 99% of the time a business’s “greed” gets written about, and there are publicly listed businesses that can be referenced, notice that no one links to the increasing profit margins to prove the greed. Because the claim is usually false. Hmm: > Progressive gross profit for the quarter ending December 31, 2023 was $2.665B, a 127.67% increase year-over-year. > Progressive gross profit for the twelve months ending December 31, 2023 was $5.547B, a 224.14% increase year-over-year. > Progressive annual gross profit for 2023 was $5.547B, a 224.14% increase from 2022. > Progressive annual gross profit for 2022 was $1.711B, a 63.64% decline from 2021. > Progressive annual gross profit for 2021 was $4.707B, a 38.19% decline from 2020. Source: https://www.macrotrends.net/stocks/charts/PGR/progressive/gross-profit https://www.macrotrends.net/stocks/charts/PGR/progressive/gr... GEICO: > 2023 pretax underwriting profit of $3.6 billion > 2023 underwriting profits for the remainder of primary operations coming in three-times higher than 2022 and more than double 2021, with written premiums growing 24.1 percent to $3.5 billion. > P/C reinsurance operations adding another $2.0 billion in pretax underwriting profit. Source: https://www.carriermanagement.com/news/2024/02/25/259036.htm https://www.carriermanagement.com/news/2024/02/25/259036.htm
- lotsofpulp 3y ago
  All of those figures are irrelevant. Profit margin (sustained) is a clear signal. https://www.macrotrends.net/stocks/charts/PGR/progressive/profit-margins https://www.macrotrends.net/stocks/charts/PGR/progressive/pr... https://www.macrotrends.net/stocks/charts/ALL/allstate/profit-margins https://www.macrotrends.net/stocks/charts/ALL/allstate/profi... Nominal amounts are never relevant for this discussion, and it is trivial that nominal profits would keep increasing since the currency is worth less over time. Otherwise, a business would eventually go out of business due to not having sufficient cushion.
  - FireBeyond 3y ago
    Progressive: so, generally averaging about 9% quarterly profits, then? With a dip to 1.7% for three quarters and then steadily increasing by 25% QOQ since then? (1.6% for Q1, 3.1% for Q2, 4.6% for Q3, to 6.1% for Q4). Progressive's sustained profit margins are doing just fine, other than a relatively brief blip where they only managed ~$2B profit in 3 quarters while inflation and the economy was suffering heavily throughout the country? Allstate's issues have as much to do with their overly aggressive stock buybacks in the last couple of years. "Allstate's auto insurance profit margins were best in the industry until about 18 months ago". "A report by Crain’s Chicago Business said Allstate spent $2.5 billion on share repurchases in 2022". "“We believe it's prudent for Allstate to pause its buyback, leaving capital in the (insurance subsidiaries) while underwriting results recover, especially as inflationary impacts on severity (replacement costs, medical, legal) are still concerning,” Greenspan said in a report titled “Stop the Buyback” last October." "Allstate is the insurance industry's most aggressive buyer of its own stock. It has repurchased 789 million shares at a cost of $42.8 billion since 1995, while issuing 154 million shares, according to its SEC filing." Continuing to push for stock buybacks as costs rise, and continuing dividend payments are failings of its own making.
    - lotsofpulp 3y ago
      I have no idea what numbers you are talking about. Progressives’s profit margins are 4% to 8% outside of 2018 to 2021. Currently under 5%. And dividends/buybacks have nothing to do with profit margin. Those are not expenses, so that money is included in profit (aka net income). From which profit margin is calculated. Revenue - expenses = profit. Profit / revenue = profit margin. Which is the same as net income / revenue = net (profit) margin