Friday, 18 March 2011

Meaning of Term in Insurance

Reinsurance: Sharing the risk by insurance companies; part or all of the insurer's risk is assumed by other companies in return for part of the premium paid by the insured; "reinsurance enables a client to get coverage that would be too great for any one company to assume". 

Self-insurance: Insuring yourself by setting aside money to cover possible losses rather than by purchasing an insurance policy.

Term insurance: Low-cost insurance that is valid only for a stated period of time and has no cash surrender value or loan value; "term insurance is most often associated with life insurance policies".

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