Life Insurance

Life insurance is one of the common insurance plans that people usually avail of. Life insurance is a contract between the policy owner and the insurer, which can be a basis of financial stability and protection after one’s death. The insurer agrees to pay a sum of money upon the insured individual’s or individuals’ death and other event such as critical illness or terminal illness. However, in return, the policy owner must pay a stipulated amount called premium at a regular interval and in lump sums. The basic intention of a life insurance is to assist and protect the dependents when the insured dies. It is an assurance that the family will receive money until they are able to sustain themselves. It is significant for families, which have young children who are not yet able to work because it provides an assurance and a peace of mind in the happening of death.

Life insurance contracts tend to fall into two major categories, which are Protection policies and Investment policies. Protection policies are designed to provide a benefit in the even of a specified event; it is typically a lump sum payment. Investment policies are designed to facilitate the growth of a capital by single or regular premiums.

There are many types of life insurance plan, which are offered by different companies. These are temporary term insurance, permanent life insurance and accidental deaths. Temporary term insurance provides life insurance that covers a specified term of years for a specified payment of premiums. This type of policy does not accumulate a cash value and generally considered as “pure insurance”, where the premium buys a protection in the event of death and nothing else.

There are three things to be considered in term insurance, the face amount, premium to be paid and the length of the coverage. Face amount is the protection or the benefit, which will be given to the plan holder in case of one’s death. Premiums to be paid are the amount of the premiums, which will be paid by the plan holder to the insurance company. Moreover, length of term is the term on how long the plan holder will be covered by the insurance. These are the things to be considered in Term insurance.

Permanent life insurance is a life insurance that remains until the policy matures, unless the plan holder fails to pay the premium when due. This type of policy cannot be cancelled or terminated by the insurer except for fraud in the application and the cancellation must occur within the specified time defined by law which is two years.

Accidental death is a type of insurance which is designed to cover the plan holder when they pass away. It includes anything from an injury, but does not typically cover any deaths resulting from suicide or health problems, because it covers only accidents, these policies are less expensive than other life insurances. The fastest and the easiest way of availing a life insurance is through the internet. It is more convenient to search online that to look on magazines, newspapers and on advertisement since it requires computer and an internet connection.

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