Insurance Information

Educated and well off people are highly motivated to buy life insurance. It is a contract between the policy owner and the insurer and the insurer agrees to pay a predetermined amount of money to the beneficiaries of the insured person in the event of his death. This ensures that the family or relatives of the insured person, gets an amount of money after his death to live in the same style as before, especially if the insured person has been the sole earning member.

Hence life insurance is an assurance of the earning member to his family members that he will take care of them even after his death.
There are different types of life insurances and there are many insuring agents. You should check them out before buying insurance. The insuring agent will explain in detail the various clauses and the terms and conditions. You can specify the amount of insurance money (amount for which you are going to be insured) and in the event of your death before the full term of the insurance policy, your heirs or your beneficiaries will get that amount.

Usually life insurance may mean that the policy matures when you are ninety five or a hundred years old. The policy matures and gets paid either when you die or on your completing the age mentioned in the policy. In return you have to pay a premium at regular intervals. This amount depends upon the face value of the insurance policy, the length of the policy, and your age. It is calculated and you have to pay it without fail. In most countries the premium paid is exempted from tax.

In some life insurance clauses there is one which states that should the policy holder commit suicide within two years of buying the policy; the beneficiaries will not get anything. This is a clause to prevent people from buying insurance mainly to make available a large amount of money when the person dies. If the insurance company has any doubts, they will generally check and cross check before making the payment. You can buy long term life insurance policy or short term one. Some buy insurance policy for a short term if they have any medical problem.

There is a difference between an insured person and a policy holder. Generally both are one and the same but in certain cases they may be two different people. If A buys a policy for his wife B, then he is the policy owner while she is the insured person.