The division of insurance into private and government insurance
Private insurance is insurance sold by private sector insurance companies that aims to make a profit. The same term may describe an insurance policy that an individual purchases directly from the insurance company and is not part of a group insurance program or an insurance program supported by the employer.
Private insurance includes life and general insurance (such as property and liability insurance and health insurance), and therefore it is based on commercial and technical principles of insurance and mathematical and statistical tables that predict the occurrence of the loss and its size taking into account previous experience and previous results of losses, and accordingly the insurance price is determined To cover the risk of loss in addition to the profit margin for the insureds who offer the insurance service without being forced or obligated to purchase, the public may refuse or accept these documents, and private insurance is practiced by either joint stock companies or Lloyds or even a government insurance agency that also seeks to make a profit, this does not change its nature ,, Insurance companies that practice private insurance are called the private insurer
Private insurance is divided into personal and commercial insurance
Personal insurance / Personal Lines
It is insurance that is granted to individuals (instead of commercial establishments or companies), and personal insurance includes many types of insurance to protect the individual from the dangers he faces, such as life insurance, health insurance, personal liability insurance, travel insurance, homeowners insurance etc.
The individual does not live in isolation from people, but is affected by their actions and mistakes and affected by his actions or neglect, and the life of the individual is surrounded by the risk of uncertainty, for example death, injury, fire, theft, earthquake, low value of his savings, etc., so he buys Insurance as a means of managing the risks faced.
Commercial Lines / Commercial insurance / business insurance
Commercial insurance is called any documents that are issued to commercial establishments, companies, institutions, and government agencies. Examples of this insurance are commercial car insurance, fire insurance, property insurance, liability insurance, product liability insurance, breach of trust and crime insurance
In the field of insurance, the term commercial insurance is used to indicate that the insured is a company or institution while the term personal insurance is used to indicate that the insured is an individual or individuals, for example, commercial liability insurance insures the company against liability Civil while personal liability insurance insures the individual against civil liability
Government insurance / public insurance
Governmental insurance is insurance administered by a government agency under the auspices of the state. It may be managed by a special body but under the supervision and control of the government.
Governmental insurance mainly includes social insurance, in addition to other government insurance that are managed by the state itself instead of leaving it to private insurance companies
Social insurance is also called national insurance, and it is a method of social security. Social security does not aim to achieve profit, but rather aims to achieve social security in the sense of solidarity and solidarity among members of society. Social security is a general system that aims To ensure a minimum standard of living for everyone in society, and to help the poor who is unable to meet their basic needs, therefore social security provides an economic security guarantee to the poor in the form of aid and subsidies
Unlike private insurance that aims to profit, social insurance does not aim to make a profit, but may be supported by the state, and while private insurance is optional, social insurance is compulsory insurance determined by law and it is compulsory for a specific category (business owners ) In favor of another category (workers), or its premiums are deducted from the wages of insured workers, or the employer participates in these premiums
Social insurance provides financial benefits, monthly pensions, or medical treatment to vulnerable classes in the event that they are exposed to emergencies (emergency events), such as illnesses, accidents, disability, unemployment, or reaching old age, early death, widowhood, orphanhood, and other hardship cases that A person is exposed to it, and in most cases the state takes over the administration of social insurance, meaning that the government plays the role of the insurer, and the government rarely assigns social insurance to commercial companies, but not all compulsory insurance is taken over by the state itself, but it may leave the types of compulsory insurance to Private insurance companies, such as compulsory car insurance, and social insurance remains a social insurance and its quality does not change even if it is practiced by private institutions because it is still the goal of social security
Government insurance is all insurance that the state undertakes on its own due to the refusal of private companies to engage in poor results in the event of the realization of the danger, such as the dangers of atomic and nuclear radiation that cause cancer and impairments, and its effect does not appear until after many years.
Social insurance contains many benefits for the people or the public in every country, but the essence of social insurance is that it has collected many covers (insurance) that include life insurance, disability and unemployment insurance, health insurance, pensions, etc., and these multiple covers need the participation of all citizens by forcing Everyone in the community is able to become a participant in the social security system