1, insurance
Insurance is a financial arrangement to share unexpected losses and provide economic security. In other words, in order to protect the uncertain risks in the future, the uncertain large losses it faces will be converted into certain small expenditures, and the large or continuous expenditures in the future will be converted into current fixed expenditures.
Step 2 guarantee
Guarantee is to ensure the performance of debts that have been determined or clearly agreed under certain circumstances. On the other hand, the guarantee is the guarantee of the creditor's rights, and the creditor has fulfilled the debt in order to make the creditor get the corresponding consideration, that is, to ensure the acquisition of benefits. The ultimate guarantee of insurance is to share losses, not to ensure the acquisition of benefits.
Legal basis:
People's Republic of China (PRC) insurance law
Article 2 The term "insurance" as mentioned in this Law refers to the commercial insurance behavior in which the applicant pays the insurance premium to the insurer in accordance with the contract, and the insurer is liable for the property losses caused by the possible accidents agreed in the contract, or when the insured dies, is disabled or sick, or reaches the age and time limit agreed in the contract.
People's Republic of China (PRC) Civil Code
Article 386 Where the debtor fails to perform the due debt or the parties agree to realize the security interest, the holder of the security interest shall have the priority to be compensated for the secured property according to law, except as otherwise provided by law.