Insurance and reinsuranceare two important risk management concepts in the world of finances. While life insuranceand other forms of insurance offer financial security to an individual against unforeseen circ*mstances, reinsurance does the same for an insurance provider.
Although both appear to be similar, they are different concepts with different areas of application. This blog will discuss how insurance and reinsurance differ from each other. It will also highlight thedifference between insurance premiums and reinsurance premiums.
Let’s dive in!
Table of Content
-
What is Insurance? - Different Types of Insurance
- What is Reinsurance?
- Different Types of Reinsurance
- Difference Between Insurance and Reinsurance
- Final Thoughts
- Frequently Asked Questions
What is Insurance?
Insurance refers to an agreement between two entities, where one entity agrees to provide financial coverage to the other in case of specific unexpected damage or loss in exchange for premiums paid at regular intervals.
The entities we are referring to are — an insurance company and an insurance policyholder.
Different Types of Insurance
There are several types of insurance designed for individuals, businesses, and other entities that hold some value for the insured. The following are the main types of insurance:
- Life Insurance
- Health Insurance
- Motor Insurance
- Homeowners Insurance
- Liability Insurance
What is Reinsurance?
Reinsurance is a contract between an insurance company and a reinsurance provider. In other words, insurance providers buy reinsurance to protect themselves against losses arising from their customers.
It basically transfers some portion of the risk of the insurance company to another insurance company or a group of insurance providers to mitigate the losses smoothly.
Different Types of Reinsurance
There are mainly two types of reinsurance policies:
- Treaty Reinsurance: In this type of reinsurance, the insurance provider buys coverage for all of its policies within a specific category or a time period.
- Facultative Reinsurance:In this type of reinsurance, the insurance provider buys coverage for a single or a set of insurance policies.
Difference Between Insurance and Reinsurance
As mentioned above, insurance and reinsurance differ from each other in several ways. Following are the main differences between both concepts:
Risk Transfer
The biggest difference between insurance and reinsuranceis the process of risk transfer and management. In the case of insurance, the insured transfers risk arising from unforeseen events to the insurer in exchange for premium payment. On the other hand, reinsurance involves transferring the risk of one insurance company to another in exchange for premiums paid at regular intervals.
Cost
Reinsurance policies can sometimes be more expensive than insurance policies. The reason is simple: insurance policies are designed for individuals, while reinsurance policies are intended to cover catastrophic losses prone to insurance companies.
Premium
The difference between insurance and reinsurance premiumsis not significant. In both cases, premium payments are made at an agreed time period.
Policyholders
In the case of Insurance, the policyholder refers to an individual or a business that buys a policy to protect its valuable assets. On the other hand, the policyholder in the case of reinsurance is an insurance provider or a large insurance firm.
Regulations
Both insurance and reinsurance plans are regulated by different bodies. While state authorities regulate insurance, reinsurance is regulated by federal bodies.
Quick Table for Difference Between Insurance and Reinsurance | ||
Parameter | Insurance | Reinsurance |
Risk Transfer | Transfer of risk from the policyholder to the insurer on the occurrence of a covered event | Transfer of risk from one insurer to another insurer |
Cost | Lower than Reinsurance | Higher than Insurance |
Premium | Paid per policy agreement | Paid per policy agreement |
Policyholder | Individual, businesses, or groups of people like employees of a company | Insurance company |
Regulations | Regulated by state authorities | Regulated by federal authorities |
Final Thoughts
Having the right insurance scheme is important for everyone to ensure financial protection in unpredictable events.
However, insurance companies themselves are prone to certain risks and liabilities. This is where reinsurance becomes important. It protects the insurance providers against these risks.
This blog outlined the difference between insurance and reinsurancein detail. As mentioned above, both concepts play a pivotal role in risk management. Hence, it should be purchased wisely.
Consider buying a life insuranceplan to secure your loved ones against future financial insecurity.
Diagnosis of Viral Fever
To diagnose viral fever, the doctor has to first rule out bacterial infections. This is because viral and bacterial infections have similar symptoms. It is done by taking your samples to test for bacteria and considering your medical history and symptoms. Depending on your symptoms, your medical practitioner can ask you to test for dengue, malaria or chikungunya.
If you have a severe infection, the doctor may also recommend imaging tests like a CT scan or chest X-ray. Some common ways to diagnose viral fever include blood tests, swab tests, antibody tests, urine tests, and specific viral antigen tests.
Diagnosis of Viral Fever
To diagnose viral fever, the doctor has to first rule out bacterial infections. This is because viral and bacterial infections have similar symptoms. It is done by taking your samples to test for bacteria and considering your medical history and symptoms. Depending on your symptoms, your medical practitioner can ask you to test for dengue, malaria or chikungunya.
If you have a severe infection, the doctor may also recommend imaging tests like a CT scan or chest X-ray. Some common ways to diagnose viral fever include blood tests, swab tests, antibody tests, urine tests, and specific viral antigen tests.
Diagnosis of Viral Fever
To diagnose viral fever, the doctor has to first rule out bacterial infections. This is because viral and bacterial infections have similar symptoms. It is done by taking your samples to test for bacteria and considering your medical history and symptoms. Depending on your symptoms, your medical practitioner can ask you to test for dengue, malaria or chikungunya.
If you have a severe infection, the doctor may also recommend imaging tests like a CT scan or chest X-ray. Some common ways to diagnose viral fever include blood tests, swab tests, antibody tests, urine tests, and specific viral antigen tests.
Viral Fever Treatment
In most cases, you do not require any specific treatment for a viral infection. This is because viruses do not respond to antibiotics like bacteria do. You can treat viral fever at home and relieve yourself from symptoms in the following ways:
Take over-the-counter fever reducers like ibuprofen and acetaminophen to reduce fever, pain, and inflammation.
Drink a lot of fluids to avoid dehydration.
Take a bath in lukewarm water to regulate your body temperature.
Take plenty of rest.
Keep checking your body temperature to know when to reach out to a doctor.
Take antiviral medications if required.
Apply a warm compress on your forehead to ease the headache.
Take a balanced nutritious diet to boost your immune system's ability to fight against infection.
Note: It is crucial to seek medical attention if your fever does not subside after three days or increases to 100.4°F or 38°C (in infants), 102°F or 39°C (in children) and 103°F or 39°C (in adults).
Prevention of Viral Fever
Viral infection fever can be easily transmitted from one individual to another. It is better to take preventive measures to keep yourself and your loved ones safe. Some of the steps that can help you prevent viral fever include:
Always wash your hands with soap or hand wash before eating. You can use sanitiser if you do not find water.
Avoid touching your mouth or nose with unclean hands.
Keep your surrounding areas clean. Check for any stagnant water in your home, as this can become a breeding ground for mosquitoes.
Use mosquito repellents to protect yourself from mosquito bites.
Make sure to take precautions when visiting or taking care of a sick individual. Try maintaining a distance. You can use a mask or gloves to stay safe.
Boost your immunity by consuming healthy and nutritious food.
Get vaccinated against multiple viral infections.
Wrapping Up
Most cases of viral fever are nothing to worry about. The fever usually goes down in three to four days. But if your fever reaches 103°F (39°C) or you witness unusual symptoms, it is essential to consult a doctor.
Staying financially secure against viral infections and other health issues is equally important, especially when medical inflation is crossing the roof.
You can choose from a range of health insurance products to secure your loved ones and yourself. Standalone comprehensive health insurance plans and certain health riders with life insurance plans can serve as protective shields in times of distress.
