Comments on: The Insurance Death Spiral http://12angrymen.wordpress.com/2008/05/16/the-insurance-death-spiral/ Sermo humanus per verba irata Wed, 23 Dec 2009 05:46:13 +0000 http://wordpress.com/ hourly 1 By: Mirella http://12angrymen.wordpress.com/2008/05/16/the-insurance-death-spiral/#comment-11040 Mirella Fri, 10 Oct 2008 10:45:32 +0000 http://12angrymen.wordpress.com/?p=237#comment-11040 Well written article. Well written article.

]]> By: Angry Illini Husker http://12angrymen.wordpress.com/2008/05/16/the-insurance-death-spiral/#comment-9438 Angry Illini Husker Tue, 20 May 2008 02:09:46 +0000 http://12angrymen.wordpress.com/?p=237#comment-9438 The question, at least to me, seems to boil down to "At what rate do insurance companies need to keep expanding profits?" It is a unique industry in the fact that they have great control over their primary revenue and cost streams. Seeing as insurance is a necessity in America, almost as much as food and water, they could easily be a "secular growth" company in the minds of Wall St. like the groceries store chains. However, here's a couple numbers for comparison: Kroger - FY'08 expected EPS of 1.90, FY'07 EPS of 1.72 AFLAC - FY'08 expected at 4.03, FY'07 at 3.27 Now, this is a very limited sample of the 2 largest companies (by market cap) in their respective industries (per Yahoo! Finance). But you can see how the insurer is expected to grow its profits faster. Maybe a post on the relationship between expanding corporate profits and Wall Street pressure is in order too. The question, at least to me, seems to boil down to “At what rate do insurance companies need to keep expanding profits?” It is a unique industry in the fact that they have great control over their primary revenue and cost streams. Seeing as insurance is a necessity in America, almost as much as food and water, they could easily be a “secular growth” company in the minds of Wall St. like the groceries store chains. However, here’s a couple numbers for comparison:

Kroger – FY’08 expected EPS of 1.90, FY’07 EPS of 1.72
AFLAC – FY’08 expected at 4.03, FY’07 at 3.27

Now, this is a very limited sample of the 2 largest companies (by market cap) in their respective industries (per Yahoo! Finance). But you can see how the insurer is expected to grow its profits faster.

Maybe a post on the relationship between expanding corporate profits and Wall Street pressure is in order too.

]]> By: mildlypiquedacademician http://12angrymen.wordpress.com/2008/05/16/the-insurance-death-spiral/#comment-9432 mildlypiquedacademician Sat, 17 May 2008 20:24:56 +0000 http://12angrymen.wordpress.com/?p=237#comment-9432 Insurance in some areas is next to unaffordable... primarily because of uninsured driver risk. Insurance in some areas is next to unaffordable… primarily because of uninsured driver risk.

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