The difference between Reinsurance and Coinsurance:

• Reinsurance: Is a product the insurance company purchases to insure against large losses.
  The company transfers risk of large loss by purchasing insurance from a “ Reinsurer ”. See Investopedia definition.
• Coinsurance: Is a percentage the insured/policyholder must pay for losses they incur. The application is different in property insurance than with health insurance:
• Property Insurance: It is the risk or cost that the insured/policyholder assumes for losses in the event that the insurance limit they purchase is not adequate, when compared to the contractual value required of the insured property.
  This is sometimes called a Coinsurance requirement or Coinsurance penalty. See Business Dictionary .com definition
• Health Insurance: It is the percentage the insured/policyholder must pay for covered losses. Usually this amount starts after a deductible and is capped after a certain amount of out of pocket loss. See Investopedia definition

The International Risk Management Institute (IRMI) has an excellent post on the different applications and confusion surrounding the subject of Coinsurance in both areas of insurance. At the Ryan Agency we believe that helping you understand insurance terminology helps you to Save Smart!