Why do insurance companies prefer to pay customers in advance rather than in bulk?

The marketing orientation of insurance companies is annual payment rather than wholesale, and additional risks are only attached to annual payment of main insurance. Annual payment of products has the greatest income for salesmen, and the payment method to maximize the income when the insured insures life insurance and annuity insurance is undoubtedly wholesale payment.

An insurance company refers to a company as a legal person established in accordance with the Insurance Law and the Company Law. Insurance companies collect premiums, invest the premium capital in bonds, stocks, loans and other assets, and use the income of these assets to pay the insurance compensation determined in the policy.

Insurance profit

1, underwriting profit

(1) A customer pays the insurance premium for one or more times within a certain period of time, and the insurance company collects a large number of insurance premiums paid by customers. In the event of an insurance accident, the insurance company will pay the agreed compensation. If the indemnity expenditure of the insurance company is always less than the premium income, the difference will become the "underwriting profit" of the insurance company.

(2) For some policyholders, the insurance premium they get because of the insurance accident is much higher than the insurance premium they pay, while others may not get compensation at all because there is no insurance accident during the whole insurance period. In a word, the total amount paid by insurance companies is less than the premium income they get. The difference between these two forms is cost and profit.

2. Investment profit

From the time when the insurance company receives the insurance money to the time when the insurance company pays the indemnity, the insurance company can invest the insurance funds and earn income. The return on investment is an important source of profits for insurance companies. It can be said that for most insurance companies, the return on investment is the only source of profit.