If watching InsWeb (NASDAQ:INSW) plummet to roughly $3 a share yesterday, after yet another disappointing quarter, has you approaching the situation as a buying opportunity, don't fall for the "cash rich" trap. The provider of online leads for insurance companies is still struggling to turn a profit. Sure, the top line is booming, having climbed 70% higher in 2005 to hit $25 million, but the bottom line has been a disaster.

For the December quarter, InsWeb's loss widened to $0.51 a share from a $0.46-per-share deficit a year earlier. The red ink is important because it eats into the company's cash balance, and that greenery has caused a great deal of frustration for value investors.

InsWeb closed out 2005 with $2.53 a share in cash and short-term investments. Some investors mistakenly assume that because InsWeb is trading for little more than its legal tender, its downside is limited. If you're feeling that way at the moment, maybe it's time to revisit what other potential investors were looking at over the past couple of years.