Report: Insurance Companies Investing In Fast Food Chains

A study by the American Journal of Public Health found that larger health, disability and long term care insurance providers are investing big bucks into fast food chains including McDonald’s and Pizza Hut. The investments reached nearly $2 billion dollars according to Dr. Wesley Boyd, an author of the study and clinical professor at Harvard Medical School. According to the study:

• Northwestern Mutual owns $422.2 million in fast food stocks, with most invested in McDonald’s.
• Massachusetts Mutual owns $366.5 million worth of fast food stock with all but $100 million in McDonald’s.
• ING holds $406.1 million in fast food stocks, more than 75 percent of which is in McDonald’s.
• Life and long-term disability insurance company Prudential Financial has $355.5 million in fast food holdings including large portions of Burger King, Jack-in-the-Box and McDonald’s.

Boyd feels that the study shows a need for insurance companies to be held to a higher standard. “The insurance industry, so far as it seeks to make a profit, it does so in an amoral way,” Boyd said in a CBS News report. “In order to generate profits, they will invest in any area they need to … to make money, even if what they invest in, in this case fast food, is an industry that is known to cause people to get sick and to die early.” According to CNN, the authors of the report feel that perhaps the insurance company should use their power to force fast food companies into creating more healthy options.

CNN contacted several of the insurance companies about the study’s findings. One email response from Massachusetts Mutual spokesperson Mark Cybulski called the findings “absolutely incorrect.” Cybulski told CNN that as of the end of 2009 the company held less than $1.4 million in fast food stock which equals less than one-hundredth of a percent of the company’s cash and assets.

Another source told CNN that if the study is true, the insurance company may profit from investing in companies like fast food and tobacco which contribute greatly to mortality rates. “They are essentially killing off their consumer base, so it’s not a sustainable model in the long-term,” Sara N. Bleich, Ph.D., an assistant professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health told CNN. “Long-term goals should be consistent with health, because that ensures a large population from which to draw consumers.”