Lifestyle | Insurance

What is Life Insurance and how Life Insurance function?

August 21, 2020 | by Ema | 5 Comments

Life Insurance is the thing which provides financial security to your family and parents after any kind of unfortunate event of a person on which their family depends. For knowing much about it you have to maximize your knowledge related to Life Insurance. So, let’s started.

What is Life Insurance?

After taking Life Insurance policy if there is any kind of unfortunate death or permanent disability of the person who mainly earns money for the family. If that person is also not present in front of a family then also all the financial help will be given by the Life Insurance company. This feature is not provided with free of cost. You have to pay some certain amount to Insurance company every month or yearly which is known as premiums until that person is alive after that their family will get the benefit of those premiums which is paid in past. 

The person who holds policy is known as insured and policy company is known as insurer. 

According to some information, the Life Insurance company helps us in meeting three kinds of goals and those are listed below:

  • Protection: Life Insurance company provides protection to the insured person in financial security after any kind of unfortunate death or permanent disability of main earning person in a family.
  • Investment: It also helps in like, investment also. Like, if you are paying a premium to the Insurance company then somehow you are saving your money and in future, you will get full money which you can invest in some places for completing a goal.
  • Savings: The money which you are paying to Insurance company is also saving like a saving which you can use after your retirement.

What is the eligibility criteria for Life Insurance?

If you want to do Life Insurance of someone then there age must range between 18-75 years and has the premium payment options as regular, limited or single time. The sum ranges from 3 Lakh to 100 crore.

Now, let’s know how this Life Insurance works.

How Life Insurance Functions?

  • Before you purchase any kind of Life Insurance policy you first have to analyze your present financial condition and have to select an insured person on whose name you are going to buy this Life Insurance policy.
  • Now secondly, you have to choose an Insurance company and a policy.
  • After that, once you have decided Insurance company and policy now it turns to select policy term. This premium is decided into various factors like gender, age, lifestyle, etc.
  • Now, it is important for an insured person to pay a fixed premium to Insurance company on fixed time to avoid extra charges.
  • In the event of the unexpected destruction of the protected, the inquirer ought to promptly advise the organization and furnish the required records alongside the case structure 
  • On the off chance that the case is affirmed, the recipient gets the total guaranteed. The case can likewise get rejected due to reasons like delinquency of premium, the reason of death not canvassed in the approach, and so forth.

What are the advantages of Buying Life Insurance Policy?

  • Managing Family after main earning person of death: Everyone wants to live properly and wants to make their family secure but this is not for a lifetime. We can’t stop someone from death but we can secure family from Financial security. If you are the main earning person of your family then you can do Life Insurance of your own because of which your family does not have to depends on someone else. They make financial secure to fulfills important needs.
  • Help to make out from debts: Insurance companies helps to keep out family members from loan and debt after diminishing of an insured person.
  • Retirement security: It helps you after the source income starts dying at the age of 60 at the time of retirement.
  • Mental harmony: Once every one of the funds is arranged, an individual is mitigated from all the pressure and in this way, can focus on different parts of life. 
  • Investment funds device: Along with the term plan, one has an alternative to pick an arrangement which will be a mix of insurance and reserve funds. This will make a corpus for future money-related needs. 
  • Shield kids' future: Things like instruction cost and marriage costs can be a major concern while bringing up a youngster. Kid plans can help in rescuing you from such circumstances.
  • Provides security: This provides a facility of financial to there family at the time of accident and disabilities.

What are the types of Life Insurance?

There are around 7 types of Life Insurance which peoples can take according to their requirement and needs. We have listed those terms of Life Insurance below:

  • Term Life insurance.
  • Whole life insurance
  • Endowment Policy
  •  Money Back Policy
  •  Child Plan
  • Retirement or Annuity Plan 
  • United Linked Insurance Plan (ULIP).

Final Words

May be your age is around 20 then it is the best time to take Life Insurance policy. If you purchase Life Insurance policy as smaller age your family will get many benefits and you too. As with small age, the cost of the premium is very low which you have to pay. If you take Life Insurance policy at the time of old age then you have to pay high rate premium because of the chances of death increases as your age increases.

So, everybody wants to make the future of there children secure and good. Also, we all know that there is no time of death and no one can stop it. So, you can also make your family future safe from financial security with the help of Life Insurance. So, this is all about Life Insurance which we have discussed in this article. I hope this article is helpful and informative to you guys. If you have any doubt related to Life Insurance then comment down below we will try to help you as soon as possible.