Life
Insurance
Life insurance
or life assurance as many likes to put it is the simplest
type of cover or insurance policy available in the market.
You can get a life insurance policy made to cover yourself
and your family against the various uncertainties of life
and the unforeseen future.
In a life insurance policy, the specific
amount of cover is called the Sum Assured and you can choose
it to suit your needs. You can decide about the Term or duration
of the policy, that is, how long you need the protection for.
If you have to claim during the term, the
life insurance company pays you or your beneficiaries or dependants
the entire assured amount in a lump sum and absolutely tax
free. If you need not claim within the policy term, the policy
ceases as per the agreement. There is no surrender value and
if you want to discontinue the policy you can simply stop
paying the premiums.Now, why is it important for a person
to invest on life insurance? Consider the following reasons:
- In case of any mishap concerning the
earning member who has a life insurance, the insurance pays
for the expenses made towards normalising the effects of
the mishap
- If the mishap amounts to death of the
insurance holder who is also an earning member, the insurance
replaces the income and ensures that
the rest of the family is well looked after
- Life insurance also provides immediate
money after the death of the insurance holder so that the
amount assured covers all the debts and expenses left behind.
It gets difficult for the family to meet the financial obligations
in the absence of any such comprehensive cover.
- After the death of a person, it gets
difficult to pay the mortgages, car loans, medical bills,
and credit card debts. This results in an uncontrollable
flow of personal assets. Life insurance makes life smooth
by helping these amounts to be paid from the Sum Assured
leaving the assets intact for the benefit of the family.
- Life Insurance helps one to leave
an estate for the heirs, if there is no outstanding debt,
by providing the opportunity to save on the assets for the
family.
There are numerous life insurance policies on offer and numerous
life insurance agencies in the market. However, it is very
difficult to decide upon the right type of insurance one may
need. Often the insurance buyer may end up wasting a lot of
money if the purchase decision is not made judiciously. It
is always advisable to take adequate professional help and
do a proper market survey before zeroing on a certain life
insurance purchase.
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