Life insurance can be very beneficial: here’s what it is and what types exist. The subject is morally challenging, as feelings such as conscience, love and affection for family members are the driving forces behind this investment. In fact, life insurance is a gift that is given to those who love themselves and their loved ones, since an economic recognition is activated in the event that the insured person should pass away or should have a serious disability, which provides for a previous economic premium. Technically, what happens is that the insured person decides to benefit his loved ones with a capital sum and, at the moment when the contract or policy is made, decides who will benefit from it in case of misfortune.
Life insurance policy: types and cases
As already mentioned, the life insurance policy is nothing more than a written agreement, a contract entered into with an insurance company. In the contract there are clauses to be respected so that the person who remains alive can receive money. The insurer indicates to his client the sum to be insured, the duration of coverage, the minimum and maximum amount to be paid for the annual premium. Policies and cases, however, are not all the same, which is why there are three types:
- Death case policy
- Life insurance policy
- Mixed policy
If the policyholder decides to take out a policy in the event of death, it means that in the event of death, his beneficiaries will receive the full capital paid. This type of insurance is distinguished in temporary policies, when the policyholder dies at the time when he/she is still paying the policy amount, instead the whole life policy is triggered when the beneficiary receives the money after the death of the policyholder.
Another type of insurance is the mixed policy that guarantees (regardless of whether the insured is living or not) in this case the beneficiary to receive the capital. The last type of policy is the life insurance deserves a magnifying glass. First of all, the insurance company pays the policyholder in life from the moment the contract is concluded. This type of insurance is a sort of piggy bank, an investment for retirement purposes and not only, especially for those who wish to protect themselves in the face of precarious times, variable and useful especially in single-income families, who have children of an early age.
In the latter case, the policyholder decides in the stipulation of the contract, and according to his needs, the duration of the premium which varies from 5-10 years to 30-35 years. The payment can be made in one lump sum or in cadenced installments. In addition, the amount of money varies according to age (the younger you are, the less you pay); the state of health and the life you lead; the duration of the payment, the amount you want to guarantee to your beneficiaries and has an agreed fixed premium (all parameters that can also be changed over the years).
If there is an urgent need, the payment of a certain amount of this policy for retirement purposes can be received in an immediate manner (immediate annuity) which takes place from the moment the contract is stipulated. The payment of the money can also take place in a deferred manner (deferred annuity) or later, even after years as agreed with the company in the written insurance agreement. Many people confuse this type of insurance with the pension fund that was created for those who want to receive an additional pension in addition to the state pension. In these cases the money is paid to insurance companies, banks and asset management companies.
Affordable in many ways, a life insurance policy can, therefore, make it much easier for family members in life or everyday life in general. It can be a useful safeguard for the future of loved ones as well as a form of investment that can be used for personal benefit. In all families there are several monthly expenses, related to basic necessities or daily comforts, and if life is constantly changing, one cannot help but think of the unexpected that can severely compromise one’s lifestyle.
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