Tobacco may be frowned upon by insurance companies when it comes to insuring smokers, but it is a-okay as an investment. The New England Journal of Medicine is reporting that many of the biggest insurers in the world have billions of dollars invested in tobacco companies, including $4.4 billion from companies in the United States.
Prudential, which sells health and disability insurance, has $1.38 billion in two tobacco companies, including British American Tobacco, while its subsidiary, Prudential Financial, has $264.3 million invested among three American tobacco companies, including Reynolds America and Philip Morris. Massachusetts Mutual Life’s investment portfolio includes $585.3 million in tobacco, and Northwestern Mutual’s has $235.8; both have invested heavily in Phillip Morris stock.
Philip Morris is also popular with Canadian insurer Sun Life Financial Inc., seller of life, disability and health insurance. It has $890 million in the American tobacco giant. United Kingdom-based Standard Life has almost $1 billion tied up in Imperial Tobacco and British American Tobacco.
The lead author of the study, Wesley Boyd, a faculty member of Harvard Medical School, said insurers continue to put their profits above the public’s health. “It’s clear their top priority is making money, not safeguarding people’s well-being,” he said. “Although investing in tobacco while selling life or health insurance may seem self-defeating, insurance firms have figured out ways to profit from both.”
-Noel Brinkerhoff