Life, Health Insurers Invest in Fast Food Stocks
Group Claims Investments Show Insurance Companies Don't Value Health
April 15, 2010 - If life and health insurance companies really care about
health and wellness, why do they invest large sums in fast-food firms?
The question comes from members of Cambridge Health Alliance, a
Harvard-affiliated medical group. The group finds that as of June 2009, major
insurers owned $1.88 billion of stock in the five leading fast-food
J. Wesley Boyd, MD, PhD, assistant clinical professor of psychiatry at
Harvard, is one of the study authors. Boyd says that insurance companies'
business practices belie any claims that their first priority is the well-being
of their clients.
One example of these business practices with negative public health
consequences, Boyd says, is investment in fast-food companies.
"What spawned our report is our own interactions with insurance companies
that bespeak an industry highly concerned with money and puts our patients'
concerns in second place, if that," Boyd tells WebMD. "They will invest in the
largest entities that cause morbidity and mortality as long as it makes
Boyd and colleagues name several prominent life and health insurance
companies and list their investments in fast-food firms:
- Northwestern Mutual: $422.2 million
- ING: $406.1 million
- Massachusetts Mutual: $366.5 million
- Prudential Financial: $355.5 million
- Manulife: $146.1 million
- Prudential PLC: $80.5 million
- Standard Life: $63 million
- Sun Life: $26.8 million
- Guardian Life: $16.7 million
- New York Life: $2.4 million
- MetLife: $2.2 million
What should the companies do? Boyd says it would be good if they got out of
the fast-food business. But he says it would be better if they used their
position as large stock holders to push the firms to make healthier
Boyd and colleagues report their findings in the April 15 online issue of
the American Journal of Public Health.
WebMD contacted several insurers for comment. Most of the firms noted that
their investments in fast-food companies represent tiny fractions of their
"Even if it is a small part of their portfolio, to have $1.88 billion
invested in fast food shows that their first and foremost concern is making
money, not promoting health -- at least among those they insure," Boyd
That's not how the companies see it.
Northwestern Mutual spokeswoman Jean Towell says Boyd and colleagues
overestimated the companies' fast-food holdings. (Boyd defends the numbers.)
Towell says Northwestern's fast-food stock accounted for less than one-fifth of
1% of the company's $136 billion investment portfolio in 2008 -- and much less
"Northwestern Mutual places a high priority on the health of our workforce
as well as on the health of our policy holders," Towell tells WebMD. "Health
and wellness is a priority."
However, Towell agrees with Boyd that the point of Northwestern's
investments is to "generate high-quality returns" and "to make long-term value
to our policy holders."