Life Insurance Basics
It is an agreement between two parties i.e. insured and insurer where in insurer agrees to indemnify insured in event of any contingency leading to death and injuries.
Types of Life Insurance
There are various types of life covers available to an individual depending upon the sole motive of insurance in order to meet contingencies. Below are types of life cover options available to an individual:
- Term Insurance:
Term insurance plans provide insurance to an individual for a fixed tenure. It is the pure and cheapest form of insurance for an individual. This type of policy is suitable for people who are unable to pay high insurance in order to buy endowment policies.
- Whole Life insurance:
Whole life policies are totally opposite to term life plans. This insurance policy covers risk to an individual for their whole life and generally no pay backs are provided under these types of policies.
- Endowment Policy:
These are also referred as the traditional policies. Endowment policies cover the risks of an individual for a specific period of time as per the opted policy and it also pay backs sum assured and promised bonuses at time of maturity as well.
- Money Back Insurance policy:
Money back insurance policy is a type of life cover under which money is paid to an individual at different stages of life yet covering their risk for a specific period of time.
- Unit Linked Insurance Plans:
Unit linked insurance plans are the modern form of insurance. In addition to insurance cover provided by the provider, money is also invested in various avenues therefore providing opportunity to derive good returns as well. So, it serves as an insurance policy and investment plan.
- Retirement Plans:
These policies are specially meant to provide steady income to an individual after their retirement. These kinds of policies enable a person to be independent maintaining good lifestyle
- Savings and investment plans:
These plans help you to save money and also provide you investment opportunity to grow your money.
- Child Insurance policy:
These types of policies are meant especially for children. The basic motive of these policies is to provide financial assistance to a child at various stages of their education and thus making their bright future.
Term Life Protection Plan
Term life protects an individual from any contingency for a specific tenure and it is not hard on your pockets as well as premiums are very low. They offer maximum coverage and secure your family's future. They don't pay you anything back at the time of maturity if the person survives for the tenure of the whole policy which is the demerit linked with term plans.
Term Insurance Investment Plan
Term insurance investment plans serves dual person for an individual. It provides you life cover and helps your money to grow as it can be invested in various investment avenues. Investment avenues range from high risk to low risk depending upon your investment allocation.
Life Insurance Coverage
It is the sum assured to an individual in the event of any contingency. This coverage depends upon many factors like age of the insured, coverage of the policy and the policy opted by an individual. The risk group also decides the life coverage of an insurance policy.