What's the difference between commercial insurance and social security?

There are obvious differences between commercial insurance and social security in nature, coverage and payment methods.

I. Nature and purpose

Social security, that is, social insurance, is a social security system established by the state to protect the basic life of citizens. The aim is to provide workers with pension, medical care, unemployment, work injury, maternity and other aspects of protection through the joint responsibility of the state, enterprises and individuals. Social security is compulsory and all eligible workers must participate.

Commercial insurance, that is, commercial insurance, is a profitable insurance business operated by insurance companies. The purpose of commercial insurance is to provide the insured with economic compensation for specific risks by signing insurance contracts. Commercial insurance products are diverse, and different coverage and premiums can be selected according to the needs of individuals or enterprises.

Second, coverage and security content.

Social security covers a wide range, involving the basic living security of workers. Old-age insurance guarantees life after retirement; Medical insurance provides medical expenses reimbursement for workers; Unemployment insurance provides the unemployed with a certain period of life security; Work-related injury insurance provides medical care, rehabilitation and old-age security for workers with work-related injuries; Maternity insurance provides medical care and allowances for female workers during childbirth.

The coverage of commercial insurance depends on the specific insurance products, which can cover life insurance, health insurance, property insurance, liability insurance and other fields. Commercial insurance products are more flexible and can be customized according to the risk needs of individuals or enterprises.

Third, payment methods and fees.

Social security contributions are generally shared by enterprises, individuals and the state. Enterprises and individuals pay social security fees according to a certain proportion, while the state provides certain financial subsidies. Social security costs are linked to wage income, which is mandatory to some extent.

The cost of commercial insurance is entirely borne by the insured, which is determined according to the coverage, insurance amount and premium of the selected insurance product. Commercial insurance costs are flexible, and the insured can choose according to their own economic situation and risk tolerance.

To sum up:

There are obvious differences between commercial insurance and social security in nature, coverage and payment methods. Social security is a compulsory social security system established by the state to protect the basic life of citizens. Commercial insurance is a profitable insurance business operated by insurance companies, which is more flexible and diverse. In real life, individuals and enterprises can reasonably choose social security and commercial insurance products according to their own needs and risk tolerance, and build a sound security system.

Legal basis:

People's Republic of China (PRC) social insurance law

Article 2 provides that:

The state establishes social insurance systems such as basic old-age insurance, basic medical insurance, industrial injury insurance, unemployment insurance and maternity insurance, so as to guarantee citizens' right to receive material assistance from the state and society in accordance with the law when they are old, sick, injured, unemployed and have children.

People's Republic of China (PRC) insurance law

Article 2 provides that:

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 according to the contract, and when the insured dies, suffers from disability, illness or reaches the age and time limit agreed in the contract, the insurer shall be liable for the property losses caused by the possible accidents agreed in the contract.