Some extra things that should be easy to infer: on what dates were you going to a party; on what dates you had a hangover; when did you go on a diet and how good were you at sticking to it; if you have a problem with alcohol, when did it start and how it progress; are you dating someone; are you planning to travel. I could go on and on - all those things can be identified if you have a continuous record of a regular customer's purchases. And there are many companies, organizations and individuals that would make good use of such inferences - use of the kind you wouldn't want to be subject to.
While the point of advertising is to take your money, better advertising can also help you discover products you really need. For example, if they can guess when you car scheduled maintenance is, they can send you an ad related to it, and remind you that you need to do it, which is better than forgetting about it. I also have been notified of events I ended up attending and enjoyed, or received ads about food I really like. Did I spend more than I would have if it wasn't for these ads? Probably, but I don't consider going to an event I enjoy and eating well a loss of money.
As for insurance companies, adjusting your premiums can also mean lowering them. Maybe not directly, but identifying risky customers allow them to propose a lower base rate because of the lower risk. Overall, that's unfair to those who are in the high risk group and can't do anything about it (normally that's when the government is supposed to intervene), but for you as a customer, it can be a good thing.
I don't mean it can't be bad, in fact, I think ads are an overall net negative, but it is not all bad.
The reason I think it is a net negative is that a lot of resources are spend on advertising, too much I think. These resources are things that you ultimately pay for and don't go into making a better product. The reason I think it is too much is that it is adversarial. A bit of advertising is a good thing, maybe someone makes the thing you really need, but if you are not aware of its existence, that's useless, and the entire point of good advertising is to make you aware of it. The problem is that when there is competition, each competitor wants you to buy their product instead of the other one, and their advertising efforts cancel out, that's how you get overwhelmed with ads.
People don't "need" or even "want" that much. That's why every advertising campaign basically forever is always about making you feel inadequate as you are.
They can do this without spying on me.
> A bit of advertising is a good thing
I have no real beef with advertising as such (although the vast majority of it is unhelpful). My problem is just with the spying.
As you mentioned yourself, advertising is adversarial. It's a negative-sum game between competitors, and has a lot of nasty externalities. I have some more specific thoughts on this, and after posting them on HN many times, I eventually collected them in a blog article:
Mostly: better advertising means you're most likely to be duped into wasting money on things you don't want, or making suboptimal purchasing decisions, making your life worse over time.
But also: insurance companies and banks could use your grocery purchase habits to adjust your premiums or loan rates based on e.g. whether or not your purchases indicate a healthy lifestyle, a pregnancy, having kids, having some kind of medical condition, etc.