GRE's operating profits last year fell by almost two-thirds.The roots of the firm's malaise, however, affect not just GRE but the entire industry: severe overcapacity and steep falls in premium rates.
Most of the UK's 40 million drivers would see falls in premiums, he suggested.
Kantar notes that in the UK almost half (42 per cent) of the smartphone market falls in the premium category, while in Spain affordability is clearly the key driver for smartphone purchases — given Android near total dominance of the mobile landscape in the country.
If it happens, it would presumably imply a steep fall in premiums and a much smaller insurance industry.
"Insurers are unlikely to absorb the risk of insuring young male drivers by lowering their premiums to fall in line with women's, it's more likely that women will end up paying more".
This is partly because the evidence on prices does not quite fit the story: the relative prices of goods in low-skill industries did not fall in the 1980s, when the skill premium rose sharply, but they probably did in the 1970s, when it was constant.Other factors seem to have been more important.
With increasing polarization and given relative supply, we expect that the income premium from completing high school – relative to early school leaving – might fall in the future.
A fall in the premium is a move in the right direction for users, but they believe a lot more can be done; they think it would be closer to $180 a ton if the market was functioning efficiently.
Sales of the company's stalwart but somewhat mundane brands like Puppy Chow and Dog Chow have fallen in the last year, but its premium line of dog food, Purina One, was one of the industry's best performers, with sales that grew almost 10percentt.
In other words, if insurers do what we want them to do — cut costs and rein in premiums — it is likely that their loss ratios will fall.
Airlines started introducing spot fare sales for international premium seats last fall when demand fell in a deteriorating economy.
