Suppose if a person who earns money for his family has died, and then Life Insurance provides a method to send back the loss of income to his family after that person is no more. If the person wants his family to be happier even after his death then he has a choice to go for Life Insurance which provides several policies through which that person can offer money to his family after his death.
Types of Life Insurance
There are several types of life insurance. They are listed below
?Term Insurance Policy
?Money Back Policy
?Whole Life Policy
?Annuities and Pension
?Endowment Policy
Necessary for Life Insurance
Today there is no guarantee for the survival of a person. No one knows when they are going to die. We cannot predict the lifetime of each and every person in this world. There are several reasons for the person to die. Some of the reasons are listed below
?Severe illness or due to some harmful disease such as heart attack etc
?Natural disaster such as earth quake, flood etc
?Accidents
Now we can see more details about the Term Life Insurance
The term life insurance is the fundamental type of insurance. A or term assurance is a danger wrap for a particular or specified period of time. Suppose during that specified period if that injured person is died then the amount to which he had got the term insurance policy will be awarded to his family. After that specified period, if that insured person is survived then he have two choices to go. They are
?drop the policy or
?He can pay the annually increasing premiums to carry on the term insurance policy.
Illustration to depict the term insurance policy
For example when you consider a person has holding a term life insurance policy for a period of about ten years and the cost at which he buys the policy will be say hundred thousand.
Two Situations for the above problem
?Situation 1 ? He may die within the specified period
?Situation 2 ? He may not die within the specified period
Now consider the situation 1 - He may die within the specified period
In above example if he dies within ten years then the amount hundred thousand will be awarded to his family members.
Now consider the Situation 2 ? He may not die within the specified period
Assume that if that policy holder survived for that ten years then what will happen? The policy holder and his family members won't be awarded to any payment. The entire premium paid by that policy holder during that ten years will be taken by the insurance company or he can pay the annually increasing premiums to carry on the term insurance policy.
