Life is too precious, so much so that it is difficult to put a price on it. Money surely can't bring our late loved ones back or buy us happiness and affection. But, it can very well help us realize its significance for survival. A family's survival is risked if its sole earner dies unexpectedly. The demise of a loved one creates a void that is hard to fill but his/her absence must not disrupt the financial future of the family. As it is, the grief of losing a member is a lot to deal with; at least money woes should not be reason behind their worries and miseries. It is therefore, essential to realize the value of your Life and sign up for Life Insurance, which is protection against financial loss resulting from insured's death. In legal terms life insurance is a contract the policy owner and the insurer, where the latter agrees to reimburse the occurrence of the insured individual's death or other event such as terminal illness or critical illness. The insured agrees to pay the cost in terms of insurance premium for the service.

Life insurance offers you risk coverage and savings for future. Life Insurance protects you against all sorts of risks, besides that provides you an opportunity to grow your investments. It could as well be viewed as a long-term investment that supports you to save for your child's future expenses or your expenses, post retirement.

Needs and requirements of every individual vary depending on their circumstances basis which various insurance plans are designed. Such customized plans are made in such a way that they suit the likes of majority of customers. Following are the different forms of life insurance plans: 

Types of Life Insurance: 

There are various types of life insurance available to aid you in choosing according to various life stage needs.

1. Term Life Insurance: You get covered for a tenure that you specifically choose. These policies could be availed by people who find it difficult to pay a lump sum amount for endowment assurance policy or whole life policy.

2. Whole Life Insurance: This policy covers you for as long as you live. You stay protected for your entire life, thus this plan is named as whole life policy.

3. Endowment Policy: Risk is covered for a specific period; at the end of the period the sum assured along with the accumulated bonus is paid back to the policyholder. Endowment policy pays back the face value of the amount on the insured person's death, after a stipulated number of years after premium payment, or at a specified age of the policyholder.

4. Money Back Policy: This policy repays survival benefits periodically during the term of the policy.

5. Savings & Investment Plans: Help you save and invest to make your money grow.

6. Retirement Plans: This plan is a retirement solution plan and does not cover life insurance. A lump sum amount or money in installments is paid for a certain period. On completion of this period, a certain amount of money is received every month, every half-year, or every year..

7. Unit Linked Insurance Plans – Ulips: Help you make market linked investments and are designed for flexibility and safety of the investment.

8. Child Insurance Policy: Plans are designed by keeping child's financial security in mind.

Some more about Life Insurance

Life insurance is undoubtedly mandatory but availing it without understanding its functioning would make your purchase worthless and useless. Various terms and phrases need to be familiarized with prior to buying life insurance. Term Life Insurance and Whole life insurance would differ in appeal if the consumers have a strong idea about their features and uses. Otherwise if people could buy any Life insurance plan without prior knowledge and their decision would turn out be regretful, especially at the time of Maturity of the plan or death of the policyholder. Let us see how: 

Term Life Insurance Protection Plan 

Term Life Insurance protection plans give you coverage only for a specified term. The main advantages of term life insurance protection plans are that they are easy on your pocket, give you the highest amount of coverage, safeguard your family against financial liabilities and offer you tax benefits.


Term Life Insurance protection plans have no face value and hence the premium for such policies is comparatively lower when compared with other policies. In case of survival of policy term, the insured does not get any return. The premiums in such policies rise with rising age as the chances of death then are high. Once over 60 years, these policies become difficult to afford.

Life Insurance Investment Plan 

These Life Insurance Investment Plans offer you dual advantage of Investment and protection. The Life Insurance Investment Plans range from low risk to high risk investment propositions and depending on the risk profile a customer can invest in the same.

Life Insurance Coverage 

The life insurance coverage is defined as the sum assured that you buy under the policy. You have the discretion to decide your sum assured but certain factors that affect the coverage are your annual income, your life stage and your risk group.

Life Insurance Contract Terms

The most common terms used in a life insurance contract are:

1. Indisputable Clause: Your insurance company is entitled, usually during the first two years of the policy, to challenge the validity of your policy in case you hide any information from the insurer. If you are found guilty of concealment, your insurer could void the policy and return the premiums.

2. Suicide Provision: The suicide clause in your policy specifies that the insurance company will not pay you the sum assured if the insured attempts or commits suicide within a specified period from the beginning of the coverage.

3. Reinstatement Clause: If your policy has lapsed due to non-payment of premium, you can revive it by paying all the past outstanding premiums along with interest. However, you need to prove to your insurer that you still continue to enjoy good health to qualify for this provision.

4. Settlement options: You have the provision to collect the settlement proceeds as per the options offered by your company.

5. Excluded Risks: Depending on the policy, death under circumstances like war or an aviation accident may or may not be covered.

6. Grace Period: There are times when you cannot pay the premiums due to financial crunch. Your insurance company provides a grace period within which you can make the necessary monetary arrangements and pay your premiums.

Life Insurance Claims

Life insurance claims can be classified into the following:

1. Death Claims:In case of a claim under your life insurance policy, your beneficiary needs to provide the insurer:

  • A fully filled claim form
  • Original policy bond or contract
  • An original, or certified copy of the policyholder‘s death certificate
  • Proof of identity as the beneficiary


2. Maturity Claim: In order to avail the maturity benefits of your life insurance policy (at the time of maturity) you need to submit the following to your insurer

  • Original Policy Bond
  • Maturity Claim form

Verdict

Life insurance offers a dearth of benefits like life protection, financial security, tax benefits etc. So much so that it becomes difficult to avoid it. So, you must do your dear ones a favor and protect yourself against death and disabilities by opting for Life Insurance. Air, water, food and shelter are indispensable for all of us, so why is it that we are ignoring insurance? Make Life Insurance your Oxygen and provide respite to your family by insuring your life.

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