Tuesday, August 10, 2010

What Is The Importance Of Life Insurance Premium?

Life insurance policies act as a bridge between the policy owner and the insurer where benefit is paid on the incident of person’s death or illness. In return the policy owner pays a premium every month so that he can get a benefit at a later stage. The agreement is applicable for payment of the insured sum during:

  • The year of maturity.

  • Particular dates at periodical levels.

  • Unfortunate death occurrence.

The products of life insurance premium are:

  • Insurance plans.

  • Pension plans.

  • Unit plans.

  • Special plans.

  • Withdrawn plans.

    There are also Group schemes where protection is provided to group of people. This scheme is ideal for companies, employers, societies etc where one can enjoy advantage at low expense.

To pay premiums one can either pay it at cash counter or one can pay it through alternate channels which means through ECS system or atm, franchisees or through agents.

One should buy a life insurance policy because:

  • Provides full protection.

  • Payment can be made in easy installments.

  • It can also be granted as security in case one needs loans.

  • Tax deduction on income tax and wealth tax. It can act as a tax relief.

  • There are several plans and one can buy the plan that is required.

  • There are also insurance policies for women.

Why should one buy a life insurance policy?

None of us can predict our future and therefore these life insurance policies acts as an investment tool to provide benefit in case there are any mishaps. If one owns a life insurance policy one can premiums at easy installments. It helps to figure out the need.

Who can own a policy?

Any one who has lived up to the eligibility criteria can buy the policy. One needs to fulfill the condition given by the insurance company to own the policy.

Are there low cost insurance policies?

There are also low cost insurance policies now available in the market. There are Term life insurance policy premium which costs much less. The cheapness of the premium depends upon the fitness of the person. The time span of low cost policies is usually 5-10 years. Till this span one has to pay premiums to get the benefit at the later stage.

Therefore, each one of us should buy a life insurance policy so that it can stand as a pillar at time of risks.

1 comment:

H. Nizam said...

Hi Max,
A clear explanation about the importance of life insurance premium.