Distinguish between “Reinsurance and Double insurance”
Distinction between “Reinsurance and Double insurance”
Reinsurance refers to the spread of risk among insurance companies, whereby an insurance company that finds that it has entered into a contract which is a very expensive proposition, relieves itself by insuring part or whole of the subject matter with another insurer.
Double insurance arises when a person effects more than one insurance with different insurers on value of the the same risk and interest, and the sums assured exceed the property insured.
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