How Do Life Insurance Companies Make Money? 
Li `` safe moneyfe insurance companies make money the same way your bank makes money . The insurance company uses actuaries to help them design their products to assure they are covering their costs plus sufficient profit . When you pay your monthly payment the insurance companies uses the services of an Investment manager to calculate their `` short term liquidity needs '' and then they invest the balance usually in bonds , especially for `` safe money '' companies that do not invests in stocks or other investments that carry a higher degree of risk 