Life Insurance Condition : If you are preparing to take insurance these days, then know whether your insurance agent is fooling you. Learn those things about insurance that even an insurance agent does not tell you.
In the Corona period (covid-19 period), like a mountain of sorrows was broken on the common people. During this, lakhs of people also lost their lives. During this time people came to know about the importance of insurance. People are investing heavily in its insurance policy. If you are preparing to take insurance these days, then know that your insurance agent is not fooling you. Learn these things..
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There are three main components of an insurance policy: insurance premium, sum assured and deductible. Premium is the amount that you have to pay to the insurance company at regular intervals to keep the insurance contract in force. Payment can be made monthly, quarterly or annually. The premium amount varies depending on the insurance cover and the eligibility of the policyholder. Based on the premium paid, the company assures a certain amount as insurance cover in case of an adverse event.
What is Life Insurance?
Life insurance provides a pre-determined amount to the policyholder’s family on his death or after a certain period (the point at which the policy matures). The person holding the insurance shall nominate the person who will receive the money from the insurance company. The amount to be paid by the insurer will help the family to overcome financial difficulties when it has lost the breadwinner.
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Types of life insurance
1.Term Insurance
Here, on the death of the Life Assured during the policy term, the nominee receives a certain amount based on the premiums paid. But if the person survives the term of the insurance policy, then he cannot get any maturity benefit. Term insurance is cheaper than other life insurance and the premium rates are more affordable. Term insurance also covers critical illnesses where the insurance company pays a fixed amount for life-threatening illnesses.
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2. Endowment Policy
An endowment policy acts as a savings instrument along with life insurance. If the policyholder dies within the policy term, the nominee will receive a predetermined amount. But if the policyholder survives the policy term, he/she will receive the premium paid along with certain returns as per the terms of the policy.
3. Money Back Policy
This insurance policy plays a dual role of life insurance cover along with investment. The policyholder will receive a fixed amount at fixed intervals under the policy term and in case of death of the policyholder, the nominee will also receive the maturity benefit. On maturity of the policy, the holder receives maturity benefit along with bonus under the terms of the insurance contract.
