What produces RUTHLESS DICTATORS?

@Foxfyre,

Foxie, What are you trying to say? There are two dynamics in selling of insurance; one is competition, and the other is to make a profit. If they have too many loss years, they will go out of business. That's Economics 101.

Many insurance companies lost money after the hurricanes hit Florida, and the flooding in New Orleans. Many refused to pay, because they claimed it was god's fault (act of god). There are many examples of these cases where many insurance companies lost money in given years, but yet continued to make profit in others.

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@old europe,

old europe wrote:

I'm sure that in a hypothetical, completely unregulated market you could come up with numerous examples of how an insurance company would be able to routinely pay out more money in order to fulfil its obligations towards policy holders than it would make from selling those policies and still be able to stay in business. In order to cut this debate (in which we are basically in agreement) short, I'll only point out that I prefaced my initial statement by saying that it was "the very basic premise" to receive more in premiums than to pay out in losses.

No, the idea is to take in more revenue than is paid out in losses. By the explanation I provided, for years most insurance companies DID NOT depend on taking in sufficient premiums to cover their losses. They did depend on making enough on premiums PLUS investments to cover losses plus make a profit.

This is an important distinction.

1 Reply

@spendius,

spendius wrote:

Quote:
I'm afraid that doesn't explain your original assertion that an insurance company should pay out more money than it is taking in.

You can't explain that without explaining about the economic cycle and investments made by insurance companies. There are bound to be periods when insurance companies pay out more than they take in. A two hurricane year say. Don't they bundle the policies and sell them on like was done with mortgages. And trade in them. What is a health insurance company? It deals in income from securities and "overheads".

If ever bailing them out became necessary I do believe they would have a higher priority than the banks have had. Assuming the banks didn't empty the pot.

One might argue in favour of UHC by saying that if bailing out health insurance ever came to pass it would be to arrive at UHC in a disorderly manner and that it makes sense to organise properly as insurance against the possibility and which many say is a probability and a few nutters say is a certainty.

That is a political argument rather than the sort of plaintive yelpings one might hear when a kitten has got its head stuck in a baked beans can trying to lick the tomato sauce off the bottom by shoving up against a cupboard. Which I have witnessed although we did release the little love before it started yelping but not after it had backed all round the place a few times.

If the government is already holding up the edifice shouldn't it have the say-so on how that's done?

First, the quotation you attribute to me is not anything that I said. Or High Seas said for that matter. It is the interpretation that OE put on it.

Second, agreed that insurance companies often have years in which they sustain heavy losses which is why their financial planning isn't on a quarterly or even an annual bottom line basis. When State Farm or Allstate or another major company is dealing with a Katrina coupled with other major disasters, they will often have heavy losses in a given year. They expect to make sufficient profits to cover those losses in other years however. If they cannot, they go belly up.

All insurance companies took heavy hits when the housing bubble burst and the market collapsed. They, like most other industries, will have to weather the storm, however, and most have done adequate contingency planning that they will.

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@Walter Hinteler,

Walter Hinteler wrote:

okie wrote:

No, I would not consider Denmark an exception. I just would not consider Denmark anywhere near the left terminus of the scale, perhaps it would be to the left of center but probably not very far. It is socialistic in terms of many aspects to life there but not communistic, and there are freedoms and private companies that operate there, I think.

Seems, YOU are now confused with some terms, again: the Danish government is a coalition government bythe Liberal Party (Venstre) and Conservative Peoples' Party (Det Konservative Folkeparti).

Now, 'Liberal' here doesn't mean the same as you use that term.
Besides that, the Danish Liberals are ... , well certainly right of the centre.
The Danish conservatives are more centre than right, certainly left of the Liberals.

Again, Walter, you distort what I said. Thats okay, I am getting used to that. I did not characterize the political parties, I did not even mention them, what I characterized was the country of Denmark. I have relatives living in Denmark, and I have visited the country, so although I am not extremely familiar with the country and certainly not the parties, I merely gave on opinion based upon my knowledge of the country and how they live there.

Same principle with America, I would characterize us as to the right of center, but not so at all the Democratic Party, they are left and continue to want to pull the country leftward but so far it is a tug of war for them to do that. They have pulled it leftward some, but not all the way to their liking. Even though the Democrats are in majority here, that in no way indicates that the country mirrors their entire philosophy at this point in time.

1 Reply

@Foxfyre,

Don't bother, Foxfyre, I never said that! While it's obviously absurd to apply such a statement to private insurers it does apply - inevitably - to Ponzi schemes aka "the state will provide according to your needs", starting with Medicare / Medicaid, which have - as of today - a combined actuarial deficit of $43 trillion. When more Ponzi schemes like the new health care "public option" is added, we're looking at over $50 trillion.
http://www.nabe.com/publib/be/0403/040307.pdf

You at least can read - not a common characteristic around here - and I'm sure you know who the comptroller of the currency (author of the above) is. We're facing national bankruptcy within 30 years unless we stop deluding ourselves and listening to illiterates and innumerates.

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@High Seas,

Well, in OE's defense, sometimes the explanations, analogies, and references you use are sufficiently over my head that I don't understand them. While OE does seem to have a kind of pathological resistence to reading and repeating accurately what is actually said, he can be forgiven for not understanding your argument.

I never doubt that YOU understand your arguments however.

And there is no defensible excuse for intentionally misquoting you.

1 Reply

@Foxfyre,

Foxfyre wrote:

[to: Spendius]
First, the quotation you attribute to me is not anything that I said. Or High Seas said for that matter. It is the interpretation that OE put on it.

Foxfyre - as I said, give up. Spendius can actually read, but he's probably plastered at this time of day Smile

1 Reply

@Foxfyre,

Ignore OE - he's only a lawyer, and has trouble with arithmetic. It was my fault to ask him to look at Markov processes - he lost what few marbles he was originally endowed with, and should probably join Spendius in the neighborhood pub Smile

1 Reply

@High Seas,

Here I disagree with you. I think Spendi did not intentionally intend to misquote me, but rather inadvertently failed to acknowledge that the quotation he used was OE's line and not mine.

I think he is probably on our side in this debate.

1 Reply

@okie,

okie wrote:

Again, Walter, you distort what I said. Thats okay, I am getting used to that. I did not characterize the political parties, I did not even mention them, what I characterized was the country of Denmark. I have relatives living in Denmark, and I have visited the country, so although I am not extremely familiar with the country and certainly not the parties, I merely gave on opinion based upon my knowledge of the country and how they live there.

Okay. I could give an opinion as well, but I don't have relatives there.

1 Reply

@Foxfyre,

Oh, I'm sure of that - Spendius is simply soused, not dishonest. I'm sorry if I gave a different impression.

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@High Seas,

OE is a lawyer? Do you suppose he is as uncareful writing his briefs as he is in deciphering and interpreting the words of others with whom he disagrees?

1 Reply

@Foxfyre,

Well, Walter says that OE is a lawyer, and Walter is usually very reliable.

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@Walter Hinteler,

Walter Hinteler wrote:

okie wrote:

Again, Walter, you distort what I said. Thats okay, I am getting used to that. I did not characterize the political parties, I did not even mention them, what I characterized was the country of Denmark. I have relatives living in Denmark, and I have visited the country, so although I am not extremely familiar with the country and certainly not the parties, I merely gave on opinion based upon my knowledge of the country and how they live there.

Okay. I could give an opinion as well, but I don't have relatives there.

Good, sounds like a deal, also from now on I won't give an opinion of today's Germany since I have no close relatives there as far as I know, if you also hold to your new policy of not commenting on countries where you have no relatives. Do you have close relatives here Walter? If you don't, its been nice debating you, but since you probably won't be doing much more posting, all the best to you there. Bye.

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@Foxfyre,

I'm sure we could carry on this discussion for quite a while. I could point out that in a depressed economy, insurance companies would be forced to stick more to a conservative business model of either raising premiums or tightening underwriting standards. I could point out that total revenue not only has to cover losses, but also the cost of doing business and underwriting expenses. And while none of that is connected to the modelling of multistate processes brought up by High Seas, let me state that once again, I agree with your points.

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@Foxfyre,

Quote:

most have done adequate contingency planning that they will.

That might make people anxious Foxy. Only "most" ? Coming from an industry insider "most" might make people jump.

But you have ignored my political argument. Why is that?

I did the Christian argument earlier. That's ignored as well.

Nothing you said comes as any surprise to me. It's all simple and obvious stuff to anybody seriously interested in UHC. I hope you don't think it distracted me from your avaoidance of that political argument I made. In fact your "most" reinforces that argument. We like to think that they have all done adequate contingency planning. Especially the one we are paying into.

Won't the folks who man the wheel in insurance companies have had a similar educational grounding as those in the banks? Probably have similar qualifications. Mix socially. Intermarry even for short periods. Are those the "they" you referred to? An insurance company is a throbbing heart of human greed. About sixth in the spendi scale of rapaciousness. You're just talking about how such a heart expresses itself and pretending it doesn't exist.

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@spendius,

spendius wrote:

Quote:
most have done adequate contingency planning that they will.
............
But you have ignored my political argument. Why is that? .

Spendi - stop this maudlin' line of chattering and consider that Foxfyre is trying to protect you from making foolish statements which might jeopardize the new job your A2K friends just found for you. Your home team is looking for you, yes, honestly:
http://www.economist.com/classifieds/view_classified.cfm?sitd=8409&key=&sitd_type=R

Quote:

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1 Reply

@spendius,

Insurance companies go belly up all the time Spendi, and there is no reason to think that won't happen during a major recession. It hasn't signaled the end of the world before and it won't now. The better companies do plan for contingencies and most will weather major catastrophes.

What was your political argument again?

Or your Christian argument for that matter?

1 Reply

@High Seas,

Quote:

Spendi - stop this maudlin' line of chattering and consider that Foxfyre is trying to protect you from making foolish statements which might jeopardize the new job your A2K friends just found for you. Your home team is looking for you, yes, honestly:
http://www.economist.com/classifieds/view_classified.cfm?sitd=8409&key=&sitd_type=R

If you have read your link properly, as I assume you have, you will understand that I am not free to discuss such delicate matters. It's all hush-hush. Even the fact that I don't already work for them is hush-hush.

My book was to be about how the ladies wormed their way in and took over and the trouble it took to restore order.

My hero was an officer who was suspended on half-pay suspected of being involved with a KGB man in a bullion heist in Vladivostok and living on an private island off the west coast of Scotland with four barmaids to make sure he could always get a pint when he needed one. In a converted lighthouse on a small cliff with a path leading down to a secluded cove replete with golden sand and washed by the balmy waters of the Gulf Stream. Germaine Greer, who currently serves as Professor Emeritus of English Literature and Comparative Studies at the University of Warwick, gave me the idea but I can't say what it is because it would give the secret away. And with a few juicy news stories for bolstering, so to speak.

But I always get bogged down with it. The refurbishment of the lamp room took me ages. I got to the point of fancying bringing interior design to the suburbs. And that's not a job a man like me would readily take to. That was to be in Chap I. The Island. Or Jacko's Island. Chap 2 was to be Recall.

I wish somebody else would write it. I'd love it.

And I'm not going overbloodyseas ever abloodygain.

1 Reply

@Foxfyre,

Quote:

What was your political argument again?

Or your Christian argument for that matter?

They are not that far back up the page Foxy.

2 Replies

What produces RUTHLESS DICTATORS?

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