What is the difference between primary insurance reinsurance and coinsurance

Original insurance, also known as first insurance, refers to the insurance in which the insurer directly bears the original liability for the loss caused by the insured accident caused by the insured accident.

Reinsurance is also known as "reinsurance". On the basis of the original insurance contract, the insurer insures part of the risks and liabilities it underwrites to other insurers by signing a reinsurance contract. The basis of reinsurance is the original insurance, and the emergence of reinsurance is based on the need to diversify risks in the operation of the original insurer.

Coinsurance is referred to as "coinsurance". An insurance act in which two or more insurers jointly underwrite the same insurance business or jointly share the same loss. The total amount of coinsurance does not exceed the actual value of the subject matter of insurance.

If the insured amount is less than the actual value, the shortfall shall be deemed to be self-insured by the insured. The insurance rate, insurance period, and insurance liability of coinsurance are all negotiated by each insurer and the policyholder. If the loss of the insured object occurs, each insurer shall share the loss according to the proportion of their respective underwriting.

Insurance is good, as long as you buy the right insurance for yourself is the best protection.

Original insurance: The insurance that the customer buys from the insurance company, no matter what type it is, is called the original insurance.

Reinsurance: In order to diversify the possible business risks brought by the customer's original insurance to the company, the insurance company buys for the original insurance is called reinsurance. Therefore, reinsurance is also called insurance of insurance, and the difference between reinsurance and original insurance is that reinsurance can only be bought by the insurance company, and the risk of the insurance company is shared.

Co-insurance: It refers to the insurance company that underwrites the insurance subject at the same time with more than 2 insurance companies in order to diversify its own underwriting risk for the insurance subject matter with a relatively large risk unit. The difference with reinsurance is that the way of risk diversification is different, in insurance is vertical risk diversification, while coinsurance is horizontal diversification.

Specific reinsurance.

The differences from the original insurance are as follows:

1) The mark of the original insurance is the content, liability, credit or the body and life of the person, while the mark of reinsurance is the risk and responsibility assumed by the original insurer.

2) A reinsurance contract is a contract based on the original insurance contract, but is an independent contract separate from the original insurance contract. The main manifestations are: the reinsurance contract has its own independent parties, that is, the original insurer and the reinsurer; Under normal circumstances, the reinsurer shall not require the original policyholder to pay insurance premiums, and the insured of the original insurance shall not require the reinsurer to compensate; Whether the reinsurance recipient fulfills the reinsurance compensation obligation, and the original insurer shall perform the original insured's indemnity obligation; If the original insurance cover chain holder fails to perform the obligation of compensation for the original insured due to bankruptcy or private prosecution, the reinsurer shall not be exempted from the reinsurance compensation obligation to the original insurer.

3) The original insurance contract is divided into an indemnity contract and a payment contract.

4) The subject of the insurance relationship is different. The subject of the original insurance contract relationship is the insurer and the policyholder or the insured; In the case of a reinsurance contract, both parties are insurers or one party is a reinsurer.

5) The nature of the subject matter of insurance is different. The signs protected by the original insurance contract include property and its related interests, human life and bodily functions, responsibilities and credit, etc.; The reinsurance contract protects all the liability for danger borne by the original insurer.

6) The nature of insurance compensation is different. When the original insurer fulfills the obligation of compensation, the compensation for the loss of property insurance is in the nature of compensation, and it is of various life insurance.

The compensation is in the nature of a payment; The reinsurer's apportionment compensation, whether it is property insurance or life insurance, is compensation for the original insurer's liability for losses.

Further information: Reinsurance is an arrangement for allocating risk in the insurance system. Therefore, both the insured and the original insurer will be safer in terms of the financial resources of the finch clan.

A prime example of the use of reinsurance to share risk is the coverage of satellite launch insurance. This risk does not meet the general requirements for insurable risks. Insurers are exposed to significant risks when they receive special coverage.

In the event of failure, the underfunded company is likely to go bankrupt. The most sensible thing to do is to transfer some of the risk to other insurers, which will be shared by multiple insurers.

Reinsurance is a secondary extension of coinsurance.

From the perspective of the formation process of reinsurance relationship, reinsurance has the following situations:

1.Both parties to reinsurance are insurance companies that engage in direct insurance business (hereinafter referred to as direct insurance companies, the same below), and one party divides a part of its direct insurance business to the other party. Both parties involved in the reinsurance are direct companies, the former being the ceding company and the latter being the ceding company.

2.Both parties are direct insurers, and they separate and cede business from each other. This kind of reinsurance activity is called mutual reinsurance, and the two parties cede and enter each other.

3.The two parties involved in reinsurance activities, one is a direct insurance company, and the other is a reinsurance company specializing in reinsurance business (i.e., it can only accept reinsurance business, not direct insurance business from the policyholder), the former divides a part of its own business to the latter, and the latter divides into this part of the business. In this case, the direct insurer is the ceding company and the reinsurance company is the ceding company.

4.The two parties involved in the reinsurance business are the direct insurance company of the company and the reinsurance company of the reinsurance company on the other. The reinsurer distributes a portion of its own insurance business to the direct insurer, which in turn divides the direct insurer into this part of the business.

Here, the reinsurer is the ceding company, while the direct insurer is the ceding company.

5.Both parties involved in the reinsurance business are reinsurance companies, and one party distributes a part of its insurance business to the other party, and the other party divides this part of the business. The former is a ceding company and the latter is a ceding company.

6.The two reinsurers re-insure each other, i.e. re-in-reinsurance re-insurance.

The above-mentioned forms of reinsurance business, among various types of insurance companies, have formed a network and system of insurance economic relations that penetrate each other, are intricate, and have a wide range of insurance economic relations, making the insurance market an inseparable organic whole.

The relationship between coinsurance and reinsurance.

1.Similarities.

Both coinsurance and reinsurance have the effect of diversifying risks, expanding underwriting capacity, and stabilizing business results.

2.Differences.

Coinsurance is a special form of direct insurance, which is the first diversification of risk, so that co-insurers can still carry out reinsurance.

Reinsurance is to further diversify risks on the basis of the original insurance, which is the second diversification of risks, and the risk diversification can be more refined through the conversion of reinsurance.

1. The subject matter of the original insurance is the person, property, liability and credit, while the subject matter of reinsurance is the risk and liability borne by the original insurer;

2. The reinsurance contract is based on the original insurance and exists independently from the original insurance contract. Reinsurance contracts have their own independent parties;

3. The original insurance contract is divided into compensatory and payable. Reinsurance contracts are divided into temporary reinsurance contracts, contract reinsurance contracts, and appointment reinsurance contracts.

Premium waiver means that in the event of an accident risk, the insurance company bears all the premiums according to the scope of the waiver signed by the agreement between the two parties, and the premium waiver is divided into the policyholder's waiver and the insured's waiver. The insured's exemption means that the insured can get a certain amount of compensation in addition to being exempted from the corresponding insurance premiums. The policyholder's waiver is completely different, in the event of an accident and the waiver, only the unpaid premiums of the policyholder's policy will be waived.

And only if the policyholder and the insured are not the same person, the policyholder can choose to be exempted.