That’s just saying the nominal premiums are less than what they pay out, but the real value of premiums including expected return on investment is more than the losses paid out (obviously since the insurance company is in business). This real value is available to everyone since nowadays everyone can invest like the insurance companies with index funds, so comparing the real value of the premiums paid by the policyholder when the insurance company has to pay out is an accurate comparison.
It doesn’t seem useful to me to talk about nominal values when discussing value of money over long periods of time. The original comment was that insurance charges more than they payout, which was disputed saying they make up for it in investment earnings.
What I’m saying is that since the same investment earnings are available to the premium payer, it is true that the insurance company charges more than they pay out, hence the original poster is right in avoiding insurance whenever they can (i.e. they can afford to pay for a loss they might have been planning on purchasing insurance for). All they need to do is invest it in one of the many nearly free index funds, and they’re in the same boat as the insurance company, but without having to pay for the salaries of the insurance company’s employees.
