Question

Difference between reinsurance and double insurance in tabular form

Answer 1

Answer:

hey here is your answer

The term insurance can be described as an arrangement through which the risk of loss can be shifted from one party (insured) to another (insurer), by paying a specified sum, at definite intervals, i.e. premium. Double insurance is a form of insurance, wherein the individual/company insures a particular property with more than one insurer or with multiple policies from the same insurer.

Double insurance is not exactly same as reinsurance, as it is a transfer of risk on a policy by the insurance company, by insuring the same with another insurer. So, there exist a fine line of differences between double insurance and reinsurance, which are explained in this article.

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Answer 2

Reinsurance is an insurance product bought by insurance companies  for risk reduction. In turn, reinsurance will reduce the loss that an insurer might potentially suffer. In other words, it saves insurance companies from financial distress and defends them from undisclosed damages.

Double insurance is a form of insurance in which more than once the same subject is insured. In such cases, but with different insurers, the same subject is insured. The double-insurance policy is known as a legal act.

Explanation:

Double insurance is not necessarily equivalent to re-insurance, because it is a risk transfer from insurer to another insurer in an insurance company scheme. There is also a difference between dual insurance and re-insurance

1. Meaning: The term double insurance is defined as insurance under various insurance providers or under several insurance plans with the same insurer under which the property or asset is insured. Alternatively, the re-insurance can be described as an agreement helping insurance companies shift their liability to another insurer on the insurance policy.
2. Subject Matter: In double insurance, the property of the insured is the subject matter of the insurance agreement/arrangement, for which the policy is taken from different  insurers. Alternatively, in re-insurance, the reinsurance is taken for the original insurer’s risk.  
3. Compensation: In the event of double insurance, the insured would be entitled to seek compensation from all insurers. Whereas, in re-insurance, the insured claims compensation from the original insurer, who inturn claims compensation from its re-insurer
4. Loss: Under double insurance, all insurers share the real risk amount sustained in the proportion of the insured sum. Wheeras, in re-insurance, part of the liability re-insurer will be liable for part of risk re-insured by the ceding company
5. Aim: Double insurance guarantees the benefits of insurance, whereas re-insurance concerns decreasing the insurer’s risk liability
6. Interest of the Insured: The insured has an insurable interest in the insurance agreement/contract, in case of double insurance. While, in re-insurance, the original insured has no interest in re-insurance.
7. Consent of the Insured: Double insurance is possible only when the insured gives his consent for it. Whereas, in re-insurance the insured's consent is not needed .

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explain any three principles of insurance and with examples ...

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