The difference between commercial insurance and social insurance

(1) Different implementation methods: Social insurance is enforced by national legislation and belongs to government behavior. All workers who meet the statutory conditions must participate in social insurance in accordance with national laws and regulations; Commercial insurance is a kind of commercial behavior. Insurers and policyholders follow the principle of equality and voluntariness and take out insurance independently.

(2) The purpose of implementation is different: social insurance is the basic right of workers, not for profit, and its starting point is to protect the basic livelihood of workers and maintain social stability; Commercial insurance is the business activity of financial enterprises, and its fundamental purpose is to obtain profits, and on this premise, to give economic compensation according to the insurance contract.

(3) Different characteristics: social insurance is compulsory, mutual aid and welfare; Commercial insurance is voluntary, compensatory and profitable.

(4) Different sources of funds: social insurance premiums are raised according to the unified payment ratio stipulated by the state or local government, and are enforced by the Administration; The commercial insurance premium depends on the type of insurance and the dangerous situation, and shall be borne by the insured.

(5) The government bears different responsibilities: social insurance is the basic right enjoyed by citizens, and the government bears the ultimate responsibility for social insurance; Commercial insurance is restricted by market competition mechanism, and the main responsibility of the government is to supervise commercial insurance according to law and protect the interests of policyholders.

(6) Different types of legislation. Social insurance is the obligation of the state to workers and belongs to the category of labor legislation; Commercial insurance is a kind of financial activity, which belongs to the category of economic legislation.

(7) Different levels of security: social insurance payment is based on the insured's payment years (working years), on-the-job salary level and other conditions, with the premise of ensuring the most basic life; Commercial insurance premium is paid according to the signed economic contract. As long as the insurance conditions are met, the insured can get a high level of protection.

(8) Different implementation subjects and targets: governments at all levels set up special institutions to be responsible for fund raising, payment and management, and their targets are social members within the legal scope; Commercial insurance is operated independently by insurance companies at all levels, and the applicant can be anyone who meets the underwriting conditions.

How does social insurance calculate premiums?

Payment amount = payment base * payment proportion.

1, social security payment base

Social security payment base refers to the wage base used by enterprises or individual employees to calculate and pay social insurance premiums. This base multiplied by the prescribed rate is the amount of social insurance premiums that enterprises or individuals should pay.

Local social security payment bases are linked to local average wage data. It is determined according to the average monthly wage income of employees from June 1 day to February 1 day in the previous year. Once a year, it will not change within one year after confirmation. The time to apply for adjusting the social security base is generally in July.

Enterprises generally take the total wages of enterprise employees as the payment base, and individual employees take half of their average monthly salary in the previous year as the salary base for individuals to pay social insurance premiums. In China, the payment base is approved by the social insurance agency according to the employer's declaration.

2. Payment ratio

Payment ratio, that is, the collection rate of social insurance premiums. China's "Social Insurance Law" does not make specific and clear provisions on the collection rate of social insurance. According to China's current social insurance policy, we implement different collection ratios for different types of social insurance.

Through comparison, we find that the difference between commercial insurance and social insurance mainly exists in eight aspects, and the above small series has been listed for everyone. I believe that after comparison, you should be able to distinguish the two boxes accurately in the future. As far as social insurance is concerned, the expenses are often shared by employers and employees. But if you are a freelancer, you can only bear the expenses when you participate in endowment insurance and medical insurance.