Rebuttal to CNBC “Cashing in on Catastrophe” report on Business Nation which aired on CNBC 3/2/08.
United States of America (Press Release) March 6, 2008 --
The news report which aired on CNBC titled “Cashing in on Catastrophe” depicts the insurance industry as a whole in a damaging manner. To promote this news report, CNBC placed an advertisement in the Wall Street Journal on 2/27/2008 that promised a scathing report on “How the insurance industry is protecting their profits, not policy holders, when natural disasters strike.”
To insinuate in your news report that the insurance industry’s objective as a whole, is to be more concerned about profits does not, in reality, prove true. Your interview included comments from Robert Hartwig, president of the Insurance Information Institute. According to data compiled by this organization from 1955 to 2006 the property and casualty industry as a whole had a return on equity below the average for all U.S. industries more than 87 percent of the time!
If what you were suggesting in your news report were true, how do you explain the long term profitability of the industry as a whole? If insurance company’s most pressing concern is profits, would not the profitability numbers be greater than what historical and statistical data imply?
In the advent of major catastrophic events the insurance industry must be financially strong to survive; otherwise it may necessitate government intervention.
Because natural disasters are nearly impossible to predict, insurance companies have increased deductibles, added separate wind deductibles, or have limited their exposure to areas of the country that would be more prone to natural disasters. This has been done not to increase profits, but to safely protect the financial ability for insurance companies to care for their financial obligations.
A news report that classifies the insurance industry as an uncaring organization that is only concerned about cutting coverage at the policy holder’s expense to increase profits shows a gross lack of your news organization’s understanding of the intent and purpose of insurance.
In addition, the 2 examples illustrated in your news report depicted how claims at least initially were not settled in ways that were on favorable terms for the claimants. However, your report only explains one side or versions of the events without your viewing audience being made aware of the particular details of the claims, policy limits, or exclusions of coverage.
Finally your news report “Cashing in on Catastrophe” did not draw attention to the many satisfied clients of insurance companies after the disasters you mentioned in your report.
It only highlights the sensational stories, so hence in the opinion of our organization, your news report is inconsistent, flawed, and does not provide your viewing audience the ability to hear the rest of the story that you did not report.
The Agent Gurus Network is a non-profit organization that provides educational information to agents and consumers alike.
Please feel free to contact us: info@agentgurus.org
To insinuate in your news report that the insurance industry’s objective as a whole, is to be more concerned about profits does not, in reality, prove true. Your interview included comments from Robert Hartwig, president of the Insurance Information Institute. According to data compiled by this organization from 1955 to 2006 the property and casualty industry as a whole had a return on equity below the average for all U.S. industries more than 87 percent of the time!
If what you were suggesting in your news report were true, how do you explain the long term profitability of the industry as a whole? If insurance company’s most pressing concern is profits, would not the profitability numbers be greater than what historical and statistical data imply?
In the advent of major catastrophic events the insurance industry must be financially strong to survive; otherwise it may necessitate government intervention.
Because natural disasters are nearly impossible to predict, insurance companies have increased deductibles, added separate wind deductibles, or have limited their exposure to areas of the country that would be more prone to natural disasters. This has been done not to increase profits, but to safely protect the financial ability for insurance companies to care for their financial obligations.
A news report that classifies the insurance industry as an uncaring organization that is only concerned about cutting coverage at the policy holder’s expense to increase profits shows a gross lack of your news organization’s understanding of the intent and purpose of insurance.
In addition, the 2 examples illustrated in your news report depicted how claims at least initially were not settled in ways that were on favorable terms for the claimants. However, your report only explains one side or versions of the events without your viewing audience being made aware of the particular details of the claims, policy limits, or exclusions of coverage.
Finally your news report “Cashing in on Catastrophe” did not draw attention to the many satisfied clients of insurance companies after the disasters you mentioned in your report.
It only highlights the sensational stories, so hence in the opinion of our organization, your news report is inconsistent, flawed, and does not provide your viewing audience the ability to hear the rest of the story that you did not report.
The Agent Gurus Network is a non-profit organization that provides educational information to agents and consumers alike.
Please feel free to contact us: info@agentgurus.org
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