Ways to secure
1.- Co-insurance: the obligation with the insured is divided between the insurers, either in equal parts or in different fractions in which each one assumes the payment corresponding to their percentage of participation in the insurance.
2.- Par insurance: this is when the insured has 2 insurances that complement each other, that is, when the first insurance acts, if the second is not enabled, there would be no payment to the insured.
3.- Auto insurance: this means that the payment does not go through the insurance company but that the payment is only between individuals or between private entities, called mutual agreement between both parties without the need to go to insurance.
4.- Reinsurance: this term is used when an insured transfers all or part of the risk to another insurer, this is also related to an agreement between parties
Method of income, investment and participation in the insurance system
As in any business, in the insurance system the idea is to obtain more income than expenses, that is, to collect more money in insurance than the money paid for insurance executed, in addition to offering accessible services to the pockets of the users who are loved get.
all this is synthesized in a mathematical equation
Profit = Earned premium + Investment income - Loss - Administration and subscription expenses
Ways Insurers Earn Revenue
1.- Through the sale of insurance premiums
2.- By investing and obtaining profits and interest from the funds obtained from the sale of insurance