Have you ever opinion what will happen to your liabilities in case of your untimely death? Will your survivors contain the burden?
Why not insure your life? set aside simply, life insurance is a contract between the policy holder and the insurer where the insurer agrees to pay a pre-determined sum of money in case of the holder’s death or any other event such as terminal illness or notable illness.
How do you insure life? The policy holder agrees to pay a position amount known as premium at regular intervals or in lump sums. In fact, one can also insure the death to cater for after funeral expenses that are included in policy premium.
Life insurance policies can either be protection plans or investment plans. While the ragged gives aid in case of the occurrence of a specific event. The latter is designed to facilitate the growth of capital by regular or single premiums. A favorite obtain of protection policy is term insurance while that of investment policies are whole life and universal life.
However, there is a dissimilarity between the insured and the policy owner (policy holder), although the holder and the insured are more often than not, the same person.
If A buys a policy on his believe life, he is both the owner and the insured. If A’s wife ‘B’ buys a life insurance policy for her husband, she is the owner and he is the insured. This simply means that the insured is a participant in the insurance contract, but not necessarily a party to it.
In case of a life insurance policy, the beneficiary receives policy proceeds in case of the death of the insured. In cases where the policy owner is not the insured (also referred to as the cestui qui vit or CQV), insurance companies notice to limit policy purchases to those with an ‘insurable interest’ in the CQV.
Life insurance contracts are based on utmost top-notch faith. The individual for wishing to be insured and the insurer both pick up that the other party is acting in qualified faith. Exclusions in case of life insurance policies are death in event of suicide, fraud, war, riot and civil commotion.
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