Insurers are companies that provide and settle insurance on a commercial basis and for their own account. Insurance companies need authorisation to undertake insurance activities.
Categories of insurance
Insurers are distinguished by the categories of insurance they provide: life insurance, non-life insurance, funeral expenses and benefits in kind insurance or reinsurance.
In non-life insurance, benefits are related to the damage sustained by the insured. Examples include legal assistance insurance, accident insurance and health insurance.
Insurance only qualifies as non-life insurance if the insurer is obliged to provide a benefit due to an uncertain event or circumstance that affects the insured's interests.
Life insurance provides for payment of a capital sum upon the insured person's death. Life insurers only provide monetary benefits. The amount of the benefit is predefined, which means that it does not depend on the actual damage sustained.
Funeral expenses and benefits in kind insurance
Funeral expenses and benefits in kind insurance is a special type of life insurance, as the benefit provided is related to arranging the funeral of the deceased. A funeral expenses and benefits in kind insurer undertakes to provide a service in kind rather than a cash payment.
Reinsurance is the insurance that insurance companies take out to transfer risk other insurers. Reinsurance is effected only between professional market operators, so private individuals cannot take out reinsurance. Reinsurers only enter into agreements with insurers. They can undertake three categories of reinsurance: life reinsurance, non-life reinsurance, and funeral expenses and benefits in kind reinsurance.