Catastrophic Profits For Insurers

Given Hurricane Katrina and the other major storms last year, you would think that insurance companies would be on their knees.

Well, think again.

The Los Angeles Times reports the companies that provide Americans with homeowners and auto insurance made a record $44.8-billion in profits last year, an 18.7 percent increase over 2004.

Insurance executives describe the windfall as a fluke, the product of gains in other lines of insurance besides homeowners and a very good year for their investments.

Sounds like a rationale that you'd hear from the oil industry, which also made record profits last year despite offshore drilling, refinery and pipeline shutdowns because of Katrina and other storms.