Loading ...
In order to assess the risk profile of your life, the insurer might ask you personal details when you submit an application for life coverage. Risk profile is a factor that determines the premium amount of your policy. Also the premium amount is dependent on the cover, the amount you insure your life for. Premium amount will be higher if the cover is higher.
The factors determining the risk profile are your age, gender, your educational qualification and profession, your health and your parent's health, your hobbies, and habits. If your life is too risky by profession or by hobbies and habits, the premium amount is going to be high. If you have habits or profession that can risk your life, the risk profile is more and thus the premium too.
When the policy holder dies, the insurance amount goes to the nominated beneficiaries of him. Insurance company would verify the identification document and death certificate before paying out to the nominee. Further documents might be needed as the case may be.
Many different types of insurance policy options are available. Amongst them, term insurance is the oldest. This type of coverage is used for protecting a key employee of a company. This is temporary and increasing. The increase in the income of employee, causes the increase in the annual premium amount.
Under term insurance, the sum insured is paid to the dependents if the life insured dies at the end of the period of insurance. If the life insured is alive at the end of policy period, coverage terminates on that date.
Another form of insurance called Whole Life Insurance requires a higher premium amount to cover the risk and a portion of this amount will be used for investing in policy reserves. Some of the risks and rewards are shared with the insurer by the policy owner. This type of participating policies allow the policy holder to get a return in the form of dividends.
Universal life insurance is also a combination of insurance and investment. Here, multiple lives can be covered under one policy. Every insured life can be of different face values. Death benefit is paid out when an insured dies. It also can be surrendered for cash. Premiums can be changed. You can pay the premiums when it is due or at unscheduled dates. Also you have the flexibility to stop or restart the coverage as per the terms and conditions.
If you would like to secure your family's financial background even after your death, the best option to invest on Life Insurance. Policy coverage shows your love and care for your family and Dependants.
