Insurance purchased by an insurance company to protect itself against large losses by transferring some of its risk to another insurer.
Formed by adding prefix 're-' (again) to 'insurance', from Old French 'enseurer'. The concept developed in the 14th century as maritime trade grew and single insurers needed to spread catastrophic risks.
Reinsurance is essentially 'insurance for insurance companies'—when you buy car insurance, your insurer might reinsure part of that risk with Lloyd's of London, creating a global web of shared financial protection that most consumers never see.
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