Reply #28: They operate financial services with the profits [View All]

[krispos42]

I mean, they sit on a certain amount of financial reserves, so they operate mutual funds and offer banking services. This brings in more money, which they hold and use to pay off disasters and such. They are banking, literally, on the fact that hundreds of millions of dollars in retirement and investment funds won't be yanked out suddenly by customers, and they use that money when a big crunch hits.

The steady income from the insurance business lets them offer loans, and the pool of money from the investments hedge off major disaster claims. Since the pool of money from retirement and investment accounts largely comes from affluent people (many, presumebly, white and Republican), and most of the insured were probably poor (and presumebly, black and Democrat), it is easy to see which one you toss to the wolves when the chips are down.

And thanks to the new bankruptcy bill, all the people who have lost their houses can't cancel out the morgages, which means that the insurance companies can then go after the disaster victims legally. The victims, of course, have had their major financial asset, their home, destroyed, and the land is now worth much less, all the while they don't have a job. So now a judgement can be impressed upon the victims and their wages garnished for years.

Tt's not really a shareholder issue because once a company sells shares of stock they don't get any money from the shares increasing in value. The company does have the responsibility to keep the stock value from collapsing, of course, otherwise the shareholders will can the executives.