Define A Contract Of Life Insurance. What Are The Different Types Of Life Insurance Policies?


8 Answers

Mary Frederick Profile
Mary Frederick answered
There are a minimum of ten (10) different types of Life Insurance, each issued and purchased based upon the specific, projected future needs of the insured person and beneficiaries. Basic Whole Life Insurance, which today is often called life assurance, provides a future financial payment, to designated beneficiaries upon the death of the insured person. This policy can also act as an investment or savings instrument for some people. For instance, if I have more insurance coverage today, than will needed to cover my burial and other expenses at the time of my death, I can cash one or more life insurance policies and use the excess money for my personal needs today.    Other forms of life insurance are term life insurance sold especially for young adults or children. The purpose of such term insurance is to cover the life of the insured with a large amount of money for a specific number of years. Usually, the term or duration of coverage is 20 years. Term life insurance gives assurance to a young parent, that the spouse and children will be provided for financially, in the event of death for one of the spouses. The amount of coverage can be of various denominations.    EXAMPLE: A 25 year old couple can purchase a term life insurance policy for each of them. The term could be 20 years and the value could be $100,000. The monthly premium for each could be about $23.00 per policy. This is a good move on the part of parents today who want to provide for each and children in the event of the death of one spouse. The number of years, cost, and face value of policies can vary. A Decreasing Term Life Policy is never a good idea for young people, because the face value of the policy decreases each year and the premium remains the same. From my personal experience this is a waste of money for young people with young families.    Because whole life, universal life insurance and permanent life insurance are all policies which cover the lifetime of the insured. They also accrue interest from the premiums paid and in time, these life insurance policies can be borrowed against. Of course, if one does borrow against the policy the face value would be reduced at the death of the insured, unless the loan is paid back prior to that event.  These life insurance policies all cost more than term insurance. Often, adults cannot afford these and they purchase term insurance hoping they do not outlive the policy, which is a bit risky. The younger a person is when insurance is purchased the less money will be paid out by the insured over a lifetime.    Life insurance contracts vary dependent upon the type of instrument stated the coverage, limits and exclusions of the policy. The premiums, the face, and all other reuirements and specifications of the policy. The kind of policy and the purpose of the dictates the wording of the policy. Not all contracts are the same and all contracts should be be read very carefully before one signs a statement of acceptance, which a requirement in some states.    To purchase a life insurance policy a person contacts an insurance agent, broker or agency and arranges to meet with a sales person. Often, insurance agents and brokers will come to the home of a potential client. Sometimes the person seeking insurance goes to the office or agency and meets with a salesperson.    I recommend never purchasing a policy from an insurance agent or broker who is overly anxious in his/her attempts to sell a policy on the "spot". Take the time to review and discuss an insurance policy with a spouse, parent, or attorney, especially when it involves a large premium. Always buy policies, which have a Best A+ or higher rating by the Insurance industry.    For additional information you can enter, Define;  Life Insurance into a Google Search bar and click. You will then see a Google Web Page with definitions of Life Insurance, and links to Insurance agencies. I did not click on any of the links, since I was only seeking definitions. If, you do not have Google, enter these words into another search bar and you will get a list of websites about Life Insurance from, which you can choose. You also can go to a local library and read some samples of life insurance contracts in the Insurance reference section. Just ask the librarian for help!
abdul rehman Profile
abdul rehman answered
Definition of life insurance:
A contract of life insurance is a contract whereby the insurer in consideration of a certain premium undertakes to pay to the assured or to the nominee of the insured in case of his death or to the person for whose benefit the policy is taken a stated sum of money on the death of the insured or on the expiry of certain period.

Kinds of life insurance policies:
The following are some kinds of life insurance policies.

Whole life policy:
Under this policy the insured person pays the premium amount in whole of his lifetime and the sum assured becomes payable only at the death of insured. The sum assured is paid to the dependents of the insured person on his death. It is useful for the security of the family. The rate of premium is lower in this policy.

Endowment policy:
This policy is for a fixed tenure. The policyholders have to pay premium only up to a fixed tenure. The sum assured becomes payable either after a specified number of years or on the death of the assured whichever is earlier. The policyholder has to pay premium only up to the tenure of the policy.

Child protection policy:
It is also issued for a specified period on the lives of the child and the parent. If the payer and child both survive, at the time of maturity of policy, the sum assured becomes payable. If the payer dies before the maturity of the policy during the life of the child some amount becomes payable. But if the child dies during lifetime of the payer, before the maturity of the policy the amount becomes payable to the payer.

Joint life policy:
It is the policy on two or more person's life .in this policy the sum assured is payable to the survivor on the death of any person insured. It is useful for the husband and wife or partner in partnership.

With or without profit policy:
A policyholder who holds with profit policy has the right to participate in the profit of the company. He also gets the sum assured on the maturity of the policy. In case of without profit policy he cannot participate in the profit of the company. He can only get the sum assured. Premium in the first case is higher and is lower in the later case.

Term policy:
This for a fixed term. In this policy the sum assured is payable only on the death of the insured before its maturity. If the insured remains alive on the maturity of the policy the company will not be liable to pay. This policy is generally taken on the life of creditors because the amount of debt can be realized from the insurance company on the death of the creditor before its maturity.

Annuity policy:
In this policy the premium is payable in monthly, quarterly, six monthly or yearly installments for a specified period or till the death of insured. The assured may pay sum of money at the beginning. It is suitable for making provision for the old age.

Group insurance:
The employer purchases the group insurance policy for the employees. The employer pays the insurance premium out of the pay of the employees or from his own pocket. The rate of premium and amount of compensation increase with the increase in pay. In case of death the compensation is paid to the dependents of the insured. The amount of premium is not refundable to the customer if the employee survives during the service. The amount paid becomes the property of the insurance company.
Hafiz Muhammad Shoaib Profile
According to law and economics insurance is a type of risk management principally exercised to circumvent the risk of potential loss. A company selling the insurance is called insurer. It has become a lucrative business around the globe. Insurance rates, which are used to determine the amount of premium, may vary from company to company. An uncomplicated example is life insurance. A person pays a certain amount of premiums to the insurer. When he dies a predefined amount is given to his family.

Types of Insurance:-

Nothing is predictable on this dangerous planet. Any accident can happen or any disease can attack us. So, we should be prepared for it. There are various types of insurance policies focusing different fields of life.

Health Insurance:-

Various insurers offer health insurance plans. If the insured person is injured due to accident or is sick then the medical expenses are paid by the insurer. There is a lawful indenture between the insurer and the insured person.

Dental Insurance:-

Insurance intended to disburse the expenses related to dental care is called dental insurance. Dental insurance helps people to cope with the pecuniary hardships caused by sudden dental costs.

Auto Insurance:-

The insurance purchased for cars, trucks, and all other auto mobiles is called auto insurance or automobile insurance. The principal benefit of car insurance is the provision of protection against the losses occurred due to traffic accidents. If an insured vehicle is damaged as a result of accident, the repairing costs are paid by insurer. Auto insurance companies also provide replacements, if the vehicle is totally destroyed. It is obligatory in many countries to purchase automobile insurance. One can choose the right car insurance by comparing auto insurance quotes provided by different companies.

Pet Insurance:-

If your insured pet is injured or suffering from illness, pet insurance will pay the veterinary expenses. Some pet insurance policies are also designed to pay if the insured pet dies, is lost or stolen. Pet insurance is mostly available in developed countries.

Travel Insurance:-

Insurance which is planned to tackle financial and other potential losses while travelling within your country or internationally is called travel insurance. Travel insurance mostly hedge against the risks like theft, loss, delayed baggage, emergency evacuation, damage to personal possessions, legal assistance, accidental death, overseas funeral expenses etc.

Life Insurance:-

In life insurance there is a contract between insured and insurer. According to that contract if the insured person dies the insurer will pay an amount of money to his family. In return the insured person will pay premium to insurer. There are two types of life insurance, protection policies and investment policies. Another life based insurance is term life insurance. The insurance coverage is provided for a limited time period. After that period, its insured choice that he want to drop the policy or cotinue indemnity by paying premiums for next term.

Many insurers are providing their services. Some of the well-known insurance companies are state farm insurance, allstate insurance, farmers insurance and progressive insurance.
rommel damsel santos Profile
There are annuity policy,endowment policy,term policy,with or without profit policy.
Taila Nevado Profile
Taila Nevado answered

Hello there, it is an agreement between a person and an
insurer, who guarantees to provide benefits to the insured upon his/her demise.
Here are some contracts that exist:

Variable Life Insurance

Term Life Insurance

Accidental Death Insurance

Equity Indexed Life Insurance

You can click on this link for more information:
I hope that it is helpful to you. J

Anonymous Profile
Anonymous answered

General Insurance which is also called a non-life insurance policy, includes automobile or homeowners policy. The payment is provided depending upon the losses in a particular financial event. The same way work pet Insurance, you just need to find your best, check Petinsurancefinder

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