Reinsurance, Framework Thinking, and the Power of Structure: How to Enhance Decision-making and Communication

Feranmi Olaseinde

Hatched by Feranmi Olaseinde

Mar 09, 2024

3 min read


Reinsurance, Framework Thinking, and the Power of Structure: How to Enhance Decision-making and Communication


In the world of insurance, reinsurance plays a crucial role in providing security and stability to insurers by transferring some of their insured risks to reinsurance companies. This article explores the concept of reinsurance and its benefits, while also delving into the power of framework thinking and structure in decision-making and effective communication.

Reinsurance: A Safety Net for Insurers:

Reinsurance, often referred to as "insurance for insurance companies," is a contractual agreement between a reinsurer and an insurer. The ceding party, or insurer, transfers a portion of its insured risk to the reinsurance company. By assuming some or all of the insurance policies issued by the insurer, the reinsurer offers increased security and solvency to the insurer. This arrangement enables insurers to underwrite policies covering a larger volume of risk without excessively raising administrative costs or compromising their solvency margins. Additionally, reinsurance provides insurers with access to substantial liquid assets in the face of unexpected and significant losses.

Framework Thinking: Enhancing Decision-making:

To think fast and make informed decisions, it is essential to organize knowledge into frameworks. Frameworks allow individuals to sort and structure information, facilitating quick recall and analysis of key concepts. While schools may not explicitly teach frameworks, individuals can create their own by distilling complex concepts into their essence, much like Picasso's artistic approach. By distilling knowledge to its core elements, individuals can navigate high-pressure situations with ease. One powerful framework is the "steer, don't follow" principle, which emphasizes taking control of conversations and steering them towards desired outcomes.

Connecting Frameworks for Deeper Insights:

The true power of framework thinking lies in the ability to connect various frameworks, enabling individuals to provide richer insights and analysis. For instance, when discussing revenue generation, a simple framework of units sold, price, or both can be applied to any version of the story. By connecting this framework with another, such as profit calculation (revenue minus cost), individuals can delve deeper into discussions surrounding profitability. The ability to connect frameworks empowers individuals to think on their feet and provide comprehensive insights quickly.

Applying Framework Thinking to Business Storytelling:

In the realm of business storytelling, frameworks hold immense value. Ethos, pathos, and logos, a well-known framework representing credibility, emotions, and logic, can be applied to assess the effectiveness of presentations, marketing messages, and website content. By examining these three levers, individuals can identify areas for improvement and make their communication more compelling and impactful.

Actionable Advice:

  • 1. Build your personal library of frameworks: Invest time in creating frameworks on topics that are important to you. These frameworks will serve as mental structures that allow for quick analysis and decision-making.
  • 2. Connect different frameworks: Look for opportunities to connect multiple frameworks, as this enhances the depth and breadth of insights you can provide. The ability to see connections between frameworks enables a holistic understanding of complex issues.
  • 3. Reason from first principles: While reasoning by analogy may be mentally easier, it is essential to train your mind to reason from first principles. This approach encourages critical thinking and helps you develop a deeper understanding of the subject matter.


Reinsurance and framework thinking may seem like unrelated concepts, but they both highlight the importance of structure and organization in different domains. While reinsurance secures insurers against excessive risk, framework thinking empowers individuals to think fast, communicate effectively, and make informed decisions. By incorporating these principles into our lives, we can enhance our problem-solving abilities and navigate complex situations with confidence.

Hatch New Ideas with Glasp AI 🐣

Glasp AI allows you to hatch new ideas based on your curated content. Let's curate and create with Glasp AI :)