insurance - Basics

Insurance - insurance - Basics

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Insurance is a promise of payment for specific inherent hereafter loss in replacement for a periodic payment. Insurance is designed to safe the financial well-being of an individual, firm or other entity in the case of unexpected loss.

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Insurance

We all know about Insurance but many times we ignore some basic features of Insurance policy.

Here we will try to elaborate some of the words which your agent regularly use while explaining any Insurance policy.

By explaining the below terms we want to make you well-known with your Insurance policy.

Sum assured (also known as Cover) - This refers to the whole paid out on a policy if you die within the Term of Insurance plan. In case of an endowment policy Sum Assured can be paid out on maturity along with the bonus and in case of Money back policies a part of Sum Assured is paid out on regular intervals and on maturity along with the bonus.on regular intervals. Endowment policy It is the guaranteed whole to be paid out at maturity with or without Bonus (Depend upon the policy).

Premium - The owner regularly pays a fixed prime whole in replacement for the Insurance company's guarantee to cover any economic losses incurred under the scope of the trade of insurance.

Bonus - It is the whole added to the basic sum assured under a with-profit life Insurance policy.

Surrender value - The whole payable by the insurer to the owner of an investment-based plan in case he opts to finish the policy after three years (the mandatory lock-in period) but before its maturity date. The surrender value will be the prime paid till date minus surrender charges and any excellent loans due.

Endowment policy - In this plan the whole is paid to a policyholder if he lives survives the term even after the tenure of the Insurance compact or to the beneficiary if the insured someone dies before the date on which the policy matures.

Term Insurance - Term life Insurance is a life Insurance plan in which someone can get the huge Insurance coverage with fewer lower premium. In this plan beneficiary will get the cover whole only if the insured someone dies within the policy term. Unlike Endowment policy policyholder don't get any whole if insured someone lives even after the policy expires. One should have at least one Term Insurance policy. One can consult a financial planner for the best inherent Insurance solution.

Whole Life Insurance - A life Insurance policy where benefits are payable to a beneficiary on death of the insured, whenever that occurs. The prime payment can happen for a specified whole of years or throughout life.

Ulip - It is an abbreviation for Unit related Insurance Policy. A Ulip is a life Insurance policy which provides a combination of risk cover and investment. Some part of the whole invested in Ulip is used to furnish the Insurance cover and the remaining is invested in equity and debt investments and denoted as units.

Money Back Plan - A plan in which part of the sum assured is paid back to the policyholder at regular intervals and a part of sum assured is paid at maturity along with bonuses.

Rider - An add-on benefit ready at the selection of the policyholders that may alter inevitable features of a policy by expanding or restricting benefits.

Survival benefits - The whole payable to a policyholder under an investment-based plan if he survives the policy term. Typically, it is the sum assured plus returns (guaranteed additions / bonus) accrued.

I hope you will get new knowledge about Insurance. Where you possibly can put to easy use in your day-to-day life. And most of all, your reaction is passed about Insurance.