How do insurance companies survive through major disasters?

Question

Some natural disasters devastate huge amounts of property and assets costing huge amounts of money that I would assume policy holders would want to claim. Maybe I am naive to the huge amounts of profit that insurance companies make, but how do they survive financially?

In: Economics

Answer 1

If they are Farmers Insurance like we have in Texas they raise your homeowners insurance by 42%.
We live in north Texas but they lost money on homes destroyed or damaged by hurricanes.
Almost to the point we would be better off making our own escrow account.