Life insurance is an agreement between an insurance company and its clients; where the company assures its clients to pay coverage or a sum of money in return of a premium on the death of its clients. On the basis of agreement, some other events like critical illness or terminal illness can also prompt payment. Here, there are some definite rules of insurance company that clients are obliged to fulfill; these rules can be a little different on the basis of different insurance company’s rules and regulations.
Premium is a concern of clients who usually pay it regularly or as a lump sum. If you have a life insurance, you have to comply with some rules and limitations of its company and if you can’t do that, you may be ignored to get its beneficiaries; life insurance is obviously a legal contract with no doubt.
The main goal of life insurance is to assure its clients by providing a measure of financial security for their family when they are dead. So, you should consider your financial condition and the living style you would like to maintain for your family before buying a life insurance. In addition, you should choose the right one, which is much more secured and save and which can prompt payment at the right time. Several life insurance companies are available and they are committed to provide various beneficiaries depending on their contract’s rules and regulations.
To limit the liability of the clients, definite exclusions are often written into the agreement; examples are claims related to suicide, war, fraud, unrest, and public commotion.
Life insurance policies are based on two major categories:
- Protection policies- this type of policies is planned to provide a lump sum payment in the event of specified event. It is also called a form of term insurance.
- Investment policies- its main objective is to enable the growth of capital on regular basis or single premium. There are some Common systems of investment policies, which are universal life, variable life, and various whole life
It is worth saying that every life insurance policy is very important for the people who love his family and want to keep them safe in the event of their death.