What Is the Life Insurance Term For Paying Out Funds After a Death?
Finance Insurance

What Is the Life Insurance Term For Paying Out Funds After a Death?

Published at 02/03/2012 02:50:25


What Is the Life Insurance Term For Paying Out Funds After a Death?

Life insurance is one of the oldest and the only way of receiving death benefits. It’s a non return insurance plan like any other car insurance plan. It can be taken by anyone and it provides financial security to your dear and dependent ones. The concept of life insurance is that the sum amount of money assured by the policyholder is given to the family of the policyholder in case of his unfortunate death. Life insurance term provides an opportunity for you to get a protection cover for your dependents. The assured amount is paid only if the claim comes within the term of life insurance taken. But if there is no claim made within the stipulated time frame of the policy there is no way of getting assured amount.

Before this concept of life insurance came in the market people were depending on their joint family members. But now the time has changed along with this concept.
The basic idea of life insurance term was to have a mechanism to financially protect the future of the people dependent on you. It’s used as a tool for protection against risk. With the increasing rate and types of diseases its has strengthen its roots in the market very tight and thereby increasing its need for future. In a few countries, the insurance amount is made as tax free.


What Is the Life Insurance Term For Paying Out Funds After a Death?

Many insurance agencies are selling out life insurance term at various rates and discounts. You can find the list of life insurance agencies providing life coverage at different rates. Contact their representatives and get to know the rate and different plans offered by them.

Select one of them depending on the age and term it offers. There are many types of life insurance plans available in the market:

  • Term life insurance policy
  • Endowment life insurance policy
  • Money back life insurance policy
  • Whole life insurance policy
  • Unit Linked Insurance Plans (ULIP)


What Is the Life Insurance Term For Paying Out Funds After a Death?

Life insurance term is basically insuring in terms of one year or five years etc. You can also renew the policy once it’s expired. Life insurance term doesn’t give you benefit in form of cash in case the policyholder is alive. Once u decide to purchase life insurance term plan then you need to decide on the following:
• What amount of insurance to obtain: while deciding on the amount of insurance to be taken you need to consider your present financial situation and analyse what amount would be sufficient for your family to bear your loss.
• Period of life insurance term: the period you choose for this life insurance plan depends on present age and for how long term u want to insure?

Tips and comments

Many plans are available based on the above two points mentioned. Based on this you can either select a plan for you or make use of insurance planner to help you can to a decision based on your situation. Though anyone can take up life insurance term but it's advisable for the breadwinners to take up because they absence will hit the family financially.


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