Insurance companies

Insurance companies

Assurance company Companies or insurance companies are companies governed by the insurance code. We distinguish, among them:
- Insurance companies
- Mutual insurance companies.

The first are for-profit anonymous companies with capital and shareholders who own them. The companies therefore have an obligation of profit.

The seconds are insured associations, whose purpose is to "pool" the risks between all members to lower the amount of contributions. Mutual insurance companies therefore have no profit, because the recipient surplus must theoretically be redistributed to the members.
Mutuals

Mutuelles mutuals are insurance organizations, governed by the Code of Mutuality, non-profit: these organizations are therefore not subject to a benefit obligation. The main role is to reimburse the portion of the medical expenses remaining at the expense of the insured after reimbursement of social security (this share is called the moderator ticket).

This is why mutuals are often associated with health complementary that take care of the portion of health expenditure that social security does not always reimburse.
Provident institutions

Predictory institutions provident institutions are privately non-profit-law societies governed by the Social Security Code. These insurance bodies manage persons insurance contracts of partnership. They operate exclusively in the context of the company or in that of the professional branch.

The provident institutions propose to employees, through their company, guarantees against certain risks of so-called "social" life: the disease, the incapacity for work, the disability, the death. These so-called pension guarantees are complementary to social security benefits.
Reinsurers

The reinsurers constitute bodies a little apart because, even if they are legally belonging to the family of companies and insurance companies (since they are governed by the insurance code), they have modes of management and markets well specific.

Indeed, reinsurers, defining themselves as "insurers 'insurers, do not operate in the insurers' market, and intervene to avoid these latter too heavy financial losses in case of very big risks.
The specificities of insurance companies

Insurance companies, governed by the Insurance Code, are anonymous companies whose economic activity is quite specific.

Two main criteria distinguish insurance companies from other more "traditional" business companies:
1) The inverted production cycle
2) the contribution of investments.
The inverted production cycle

Insurance companies perceive premiums from the insured persons with a view to compensation for future claims: therefore, all their economic and commercial activity is based on what is called risk anticipation.

On the other hand, an insurer undertakes to indemnify all his insured persons who have subscribed a contract covering the risks they have been victims. This disaster compensation corresponds to its commercial benefit.

Now, unlike so-called classical business activities, where it is possible to know the cost of a product at the time of sale, it is impossible, in the field of insurance, to know, at the time of sale of A type of contract covering a certain risk, what will be the cost of this contract, since everything will depend on the loss rate and the average amount of claims that the insurer has had to compensate.

It is only at the moment of the expiry of the warranty period of a type of contract that the insurer may know how much this type of contract has reported: the lower the loss rate, the more the Insurer will have made profits, the higher the loss rate, the more insurer's margins are reduced.

Through this brief analysis, we can realize how much the notion of hazard is at the very heart of the economic and commercial activity of insurance companies, well after the sale of products (and even if statistical analyzes of More and more accurate and reliable tend to reduce the share of Aléa in the activity of insurance companies).
The contribution of investments

As we have seen, the total amount that an insurance company will have to pay to pay all the claims that his insured persons will undergo, is by definition unknown. To be able to honor its commitments, the insurance company starts with "mutualize"