There are many kinds of insurance policies that can be purchased by people. Of these a Life Insurance policy is the one which covers a person for his or her entire life.
According to this agreement, the insurance company agrees to pay a specific sum of money after the death of the person who is being insured. In return the person who purchases life insurance plan pays a premium at regular intervals of time.
Insurance companies pay the agreed sum of money only if the death of the policy holder takes place as per the insured events that have been specified in the contract. The most commonly stated insured event in life policy contracts is serious illness.
There are different types of life insurance policies that people can opt for on the basis of their requirements. Before selecting any type of policy, all types of policies must be compared and the most feasible one must be chosen.
A term life insurance plan is the most commonly used life plan that is opted for by many people. Also known as a temporary life policy, this plan covers the life of the insured person for a specified period of time. This period may be 5 years, 10 years or even 20 years. During the term of the policy, if the person insured dies, the insurance company pays the sum of money to people who have been named as beneficiaries in the contract. On the other hand, if the term of the policy ends and the policy is not renewed, the beneficiaries are not paid any cash benefits.
Another type of a life policy is the whole Life Insurance policy which covers the insured person for his entire life. According to this policy, when the insured person dies, a certain sum of money is paid to the beneficiaries named in the contract.
The amount of premium for whole life time insurance remains the same throughout the life of a person. This is mainly because the cost of this type of insurance is spread over many years. In this type of a policy, cash gets accrued over time and is paid in a lump sum.
Universal life insurance is the type of life policy in which the insured person is covered till his death. The value of this policy is divided into cash and death benefits. The cash benefits in this type of policy do not accrue over time and can be withdrawn as and when required by the policy holder. - 33372
According to this agreement, the insurance company agrees to pay a specific sum of money after the death of the person who is being insured. In return the person who purchases life insurance plan pays a premium at regular intervals of time.
Insurance companies pay the agreed sum of money only if the death of the policy holder takes place as per the insured events that have been specified in the contract. The most commonly stated insured event in life policy contracts is serious illness.
There are different types of life insurance policies that people can opt for on the basis of their requirements. Before selecting any type of policy, all types of policies must be compared and the most feasible one must be chosen.
A term life insurance plan is the most commonly used life plan that is opted for by many people. Also known as a temporary life policy, this plan covers the life of the insured person for a specified period of time. This period may be 5 years, 10 years or even 20 years. During the term of the policy, if the person insured dies, the insurance company pays the sum of money to people who have been named as beneficiaries in the contract. On the other hand, if the term of the policy ends and the policy is not renewed, the beneficiaries are not paid any cash benefits.
Another type of a life policy is the whole Life Insurance policy which covers the insured person for his entire life. According to this policy, when the insured person dies, a certain sum of money is paid to the beneficiaries named in the contract.
The amount of premium for whole life time insurance remains the same throughout the life of a person. This is mainly because the cost of this type of insurance is spread over many years. In this type of a policy, cash gets accrued over time and is paid in a lump sum.
Universal life insurance is the type of life policy in which the insured person is covered till his death. The value of this policy is divided into cash and death benefits. The cash benefits in this type of policy do not accrue over time and can be withdrawn as and when required by the policy holder. - 33372
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