What is the subscription of cash flows?

Subscribing cash flows are tactics used by insurance companies to create funds in the Provisional Response, which will be directed to other income -based initiatives. The only prerequisite for subscription of cash flows is to increase income such an insurance company, which can lead to a compromise of the usual quality of the standard used in its operating methods. When some insurance companies seek to achieve rapid growth within that business cycle, they encourage agents to obtain as many clients as possible to generate insurance resources that will be charged to clients.

This practice is referred to as subscription of cash flows and is a business with natural risks due to the very nature of the entire subscription process. For example, an insurance company that focuses on the interim rapid rapidly increased by insurance company. Provided a person who is older and also has a history of certain diseases applies to the insuranceThe insurance company can provide such covering a person, although it should not qualify for this particular coverage under normal circumstances. There is a risk from the risk that a person could develop some kind of illness that will eventually cost the insurance company.

In this case, faith in support of subscription of cash flows is that the income generated from premiums charged to such high -risk people will be assigned to places where they will bring much more money or reinvest in a way that will still earn more money and allow insurance. An analogy that describes the subscription of cash flows is a situation where the sellers of the sells product under its actual or determined value to rediscover money generated from such sales in other companies that bring much more than loss,that arose as a result of sales. Subscribing cash flows are also something that is done for a specified period as a means of generating funds, after which the insurance company returns to its usual standards for assigning clients who qualify for appropriate coverage plans.