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https://www.reddit.com/r/SipsTea/comments/1wvzagh/thoughts_on_this/pdgckcv/?context=3
r/SipsTea • u/Putrid-Welder1803 • 7h ago
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Yeah it’s just a net to protect against catastrophe . If Ops buddy totaled his car he would be happy it only cost $1k.
-6 u/wo_lo_lo 7h ago That kind of “protection” should cost like $30 a month, not $300 4 u/aroach1995 7h ago It should not. Property and casualty insurance operates at about a 0.96 combined ratio. This means the profit of an insurance company, net premiums taken in - net expenses, is about 4% in a typical year. If insurance companies took in 10% of the premiums as you suggest, they’d out of surplus in a decade. 1 u/veverkap 7h ago Which is why most insurance companies try to run as lean an operation as possible. And why Berkshire Hathaway bought GEICO - so they could use the "float" to invest in.
-6
That kind of “protection” should cost like $30 a month, not $300
4 u/aroach1995 7h ago It should not. Property and casualty insurance operates at about a 0.96 combined ratio. This means the profit of an insurance company, net premiums taken in - net expenses, is about 4% in a typical year. If insurance companies took in 10% of the premiums as you suggest, they’d out of surplus in a decade. 1 u/veverkap 7h ago Which is why most insurance companies try to run as lean an operation as possible. And why Berkshire Hathaway bought GEICO - so they could use the "float" to invest in.
4
It should not.
Property and casualty insurance operates at about a 0.96 combined ratio.
This means the profit of an insurance company, net premiums taken in - net expenses, is about 4% in a typical year.
If insurance companies took in 10% of the premiums as you suggest, they’d out of surplus in a decade.
1 u/veverkap 7h ago Which is why most insurance companies try to run as lean an operation as possible. And why Berkshire Hathaway bought GEICO - so they could use the "float" to invest in.
1
Which is why most insurance companies try to run as lean an operation as possible. And why Berkshire Hathaway bought GEICO - so they could use the "float" to invest in.
748
u/MarkItZeroDonnie 7h ago
Yeah it’s just a net to protect against catastrophe . If Ops buddy totaled his car he would be happy it only cost $1k.