What is Life Insurance: Right from birth an individual has to go through several uncertainties like illness, accidents, unexpected situations that crop up and last of all death. Now you can’t be sure that you will have savings or the expected amount to cover these unexpected situations.
I’m sure that most of you will agree to me that in such situation the first thought that comes to your mind is what do I do now? Well there is nothing that could be done at that moment other than taking debt. However you can avoid such situation in future by investing in the best life insurance plan available.
For the beginners, life insurance policy is a contract between the insurance company and the policy owner. In this plan the insured pays a certain amount at fixed intervals or a lump sum amount known as the premium amount.
As a result of this the insurer agrees to pay the sum assured if any unexpected event takes place, such as terminal illness, critical illness or if the insured is deceased.
In most of the cases the reason behind taking this policy is not the occurrence of any fatal incidents but it is the peace of mind that the insured has thinking of the fact that after them their spouse and children life is secure with this plan.
The policy matures when the insured dies or when he reaches age (for e.g. if the insured reaches 100 years of age). The assured amount is either paid in lump sum or a fixed amount is paid every month, which ever the insured or the beneficiaries opt for.
This policy can be considered null and void if the insured commits suicide or if the insured had misrepresented on the application. Thus to save your invested amount you need to be very careful least you end up loosing it.