What Is Cooperative Insurance?

Cooperative insurance organizations are one of the organizational forms of insurance. Units or individuals in need of insurance in society take out cooperative insurance. There are two types of cooperative insurance agencies: (1) Mutual insurance agencies. The agency is shared by all insureds, who are also insurers. Each member needs to pay a certain amount of compensation fund and management fee when he joins the society. If the company's compensation fund is insufficient, it can continue to collect from members, and if there is a balance, it can be returned to members appropriately. (2) Mutual insurance companies. The company is a cooperative organization in which the insured applies insurance for itself and is shared by the policyholders. The status of an insurance policy holder is similar to that of a joint stock company, and the company's custodian is elected by the policy holder. ^[1]

Cooperative insurance

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Cooperative insurance organizations are one of the organizational forms of insurance. Units or individuals in need of insurance in society take out cooperative insurance. There are two types of cooperative insurance agencies: (1) Mutual insurance agencies. The agency is shared by all insureds, who are also insurers. Each member needs to pay a certain amount of compensation fund and management fee when he joins the society. If the company's compensation fund is insufficient, it can continue to collect from members, and if there is a balance, it can be returned to members appropriately. (2) Mutual insurance companies. The company is a cooperative organization in which the insured applies insurance for itself and is shared by the policyholders. The status of an insurance policy holder is similar to that of a joint stock company, and the company's custodian is elected by the policy holder. ^[1]

Cooperative insurance organizations can be divided into

The Mutual Insurance Society is the earliest insurance organization and the most primitive form of insurance organization. Each member provides insurance for other members, and each member also receives insurance provided by other members. Mutual insurance agencies are still quite common in Europe and the United States, such as fellow Americans in the United States, Friends of the United Kingdom, and the shipowners' mutual protection association in marine insurance.

Compared with mutual insurance companies and insurance cooperatives, mutual insurance cooperatives have the following characteristics:

(1) The members of the mutual insurance society provide insurance protection to each other, reflecting the idea of "I am everyone and everyone is me".

(2) Mutual insurance companies have no share capital, and insurance premiums are allocated after the fact, which is not known in advance. The operating capital comes from the contribution paid by members. In mutual insurance societies, members need to pay for the compensation and management expenses and expenses. The members first pay the tentative contribution amount and management fee, and then calculate the determined contribution amount at the annual settlement and then return more and less.

(3) The top management body of a mutual insurance society is a management committee elected by members. Under normal circumstances, the Commission appoints a legally qualified agent to preside over social affairs and handle all matters related to insurance and in-house finance.

(4) Mutual insurance cooperatives operate as members. Mutual insurance cooperatives are not open to the public. Their organization is small and serves purely members.

2. Insurance cooperatives

An insurance cooperative is a mutual insurance organization organized and jointly operated by some people with the same insurance needs. Insurance cooperatives are very similar to mutual insurance cooperatives. Mutual insurance cooperatives are usually established in the form of cooperatives. Therefore, some insurance scholars often replace the two with each other. In fact, there are still differences between insurance cooperatives and mutual insurances.

(1) Mutual insurance cooperatives have no share capital; but to join an insurance cooperative, members must pay a certain amount of share capital. In other words, members are shareholders of insurance cooperatives, and their rights are limited to the amount of shares they subscribe for.

(2) The source of the mutual insurance society's operating funds is the contribution paid by the members. The insurance company and the members are combined for a temporary purpose. If the insurance relationship is terminated, the two parties automatically terminate the contract. Insurance cooperatives are funded by members' shares and funds borrowed from members or non-members. The establishment of an insurance relationship must be conditional on the members, but members do not necessarily have to establish an insurance relationship. The elimination of the insurance relationship does not affect the existence of the relationship between members. Therefore, the relationship between an insurance cooperative and the members is relatively long. Cooperative services can still maintain contact with insurance cooperatives.

(3) Mutual insurance cooperatives use an ex post allocation system, which is based on actual needs and actual losses. It is not known in advance, while insurance cooperatives use a definite insurance premium system and do not repay afterwards.

(4) The business scope of insurance cooperatives is limited to members of cooperatives, and only covers the risks of members of cooperatives.

The Blue Cross and Blue Shield Medical Insurance Organizations in the United States are non-profit medical insurance organizations in the United States that operate on a state or community basis. Blue Cross provides hospitalization insurance and Blue Shield provides non-hospital medical and surgical medical insurance. There are 70 such organizations across the United States. About 2/5 of Americans are members of the Blue Cross, and 1/3 of Americans participate in Blue Shield Insurance. In both cases, hospitals and cooperating underwriting organizations jointly provide medical insurance to members.

The health care group in the United States is a health insurance cooperative organization, also known as a managed medical insurance organization, which provides members with comprehensive medical and health care services. Although less important than commercial life insurance companies and the non-profit Blue Cross and Blue Shield organizations, it has grown rapidly since the 1970s.

Japan's agricultural cooperative is the most active cooperative in Japan for life insurance. It is a mutual aid organization established by farmers' organizations in accordance with the Agricultural Cooperative Law of Showa 22 (1947). The types of mutual assistance organizations include building mutual assistance, life insurance, and damage insurance. The members sign a mutual assistance contract with the grass-roots cooperatives, and then reinsurance is provided by the federations of ministries, provinces, provinces, and counties. The federation then reinsures the excess mutual retention amount to the National Mutual Aid Agricultural Cooperative Federation, that is, reinsurance. The society is not responsible for mutual assistance. The rates and terms are uniform across the country, and most of the funds collected are deposited in the Credit Agricultural Cooperative Federation or the Agricultural and Forestry Central Treasury of the Agricultural Cooperative System, or used to purchase agricultural and forestry bonds and bonds issued by financial institutions.