The primary purpose of reinsurance for an insurance company is to increase its underwriting capacity. Reinsurance is a mechanism through which insurance companies transfer a portion of their risk to other insurers, known as reinsurers. This allows the primary insurance company to write policies for larger amounts of coverage than it would otherwise be able to handle on its own.

Underwriting capacity refers to the maximum amount of risk that an insurance company is willing and able to assume. By entering into reinsurance agreements, an insurance company can spread its risk across multiple reinsurers, thereby increasing its capacity to underwrite policies with higher limits. This enables the insurance company to take on larger and more complex risks that it would otherwise be unable to handle on its own.

Reinsurance also provides stability to an insurance company's profits. Insurance companies face the risk of large losses due to catastrophes or other unexpected events. By reinsuring a portion of their risks, insurance companies can protect themselves against such large losses. In the event of a claim, the reinsurer shares the financial burden with the primary insurance company, helping to stabilize its profits and prevent significant fluctuations in its financial results.

Additionally, reinsurance helps insurance companies reduce their exposure to unearned premium reserves. Unearned premiums are the portion of the premium that has been paid by policyholders but has not yet been earned by the insurance company. By reinsuring a portion of its risks, the insurance company can reduce the amount of unearned premium reserves it needs to maintain, which can improve its overall financial position.

It is worth noting that while reinsurance helps insurance companies manage their risks and increase their underwriting capacity, it does not provide personal assistance to policyholders. The primary responsibility of providing assistance and support to policyholders lies with the insurance company itself.

In summary, the primary purpose of reinsurance for an insurance company is to increase its underwriting capacity, which allows the company to write larger policies and take on more complex risks. Reinsurance also helps stabilize profits and reduce exposure to unearned premium reserves.