The financial intermediary role of insurance funds refers to the financial intermediary role played by insurance funds in reinvesting idle parts in the process of social reproduction. In order to make the insurance business stable, the insurer must ensure the preservation and appreciation of insurance funds, which also requires the insurer to use insurance funds.
The use of insurance funds is not only necessary but also possible.
On the one hand, due to the time lag between premium income and compensation expenditure, it is possible for insurers to finance insurance funds;
On the other hand, insurance accidents do not all happen at the same time, so it is impossible to compensate all the insurance premiums charged by the insurer at one time, that is, there is sometimes a lag between the insurance premiums charged by the insurer and the compensation fees, which also provides the possibility for the insurer to finance insurance funds. However, the financing of insurance funds should be based on the premise of ensuring insurance compensation or payment, and at the same time adhere to the principles of legality, liquidity, safety and efficiency.
Further reading: How to buy insurance, which is good, and teach you how to avoid these "pits" of insurance.