Why Insurers are taking TARP funds … and how I view it.
If an insurance company is accepting TARP funds it probably means two things; 1) they went out and bought a bank somewhere so they could get in on “the deal” and 2) they mishandled their annuity portfolio. In other words, they guessed wrong. Just consider all the companies who have NOT done this.
Insurance has long been steady, reliable, solid … you know, solid like a rock. But companies who played fast and loose with their clients money and got caught in the problems of mortgages and Wall Street, failed to conduct business as its been conducted for many decades.
There are many factors that I look for when determining who to recommend to my clients. Accessibility to me, the agent is one very important thing, and another is the judgment of the executives running the companies.
It used to be that I could call most insurance companies and talk to the ones in charge. I could get a feel for them. Who they are, how they reason, etc. In many cases I could have them come to me and meet me for lunch. But those days are mostly gone, with layers and layers of management, whom can never be found to answer the phone. As an agent, I am left with judging the companies by how they present themselves and the results of decisions made. It is something I spend a lot of time researching.
I don’t believe that anyone can know for sure, anything today. But you can trust me to have put forth considerable effort and to have used the skill and knowledge I have to help you, my client. And with this in mind, I will not be recommending any insurer who went out and bought a bank so they could get in on TARP funds. Just strikes me as not the type of company who I want to recommend to my client as being solid and displaying integrity to long standing and proved sound principles of insurance.
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A virtual penny for your thoughts.
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