A life insurance is known as a form of contract that takes place among the assurer or insurer and the insurance policy holder. The insurer or the assurer makes a promise to pay a designated sum of money as an exchange of a premium. Several events like critical illness and terminal illness can trigger the manner of payment which depends upon the signed contract. The holder of the policy pays a premium and other expenses can also be included in the benefits.
Life insurance started as a way in order to reduce the risk to traders, which takes place on the early 2000 BC. It covered the funeral expenses of its members and it assisted the survivors financially. On the other hand, the modern policies of life insurance have been established in the early 18th century. The first plan of the modern life insurance policy was each member will be given an annual share from one up to three shares, which considers the age of the member, from twelve to fifty five years old. As the year end, a portion of the amicable contribution is going to be divided among the children and wives of the deceased members.
The beneficiary of life insurance will receive the policy proceeds upon the death of the insured person. The owner designates its own beneficiary but the beneficiary will not to take part to the policy. The owner is allowed to change the beneficiary as long as the policy has the so called beneficiary designation, which is irrevocable. If ever the policy has gone, the policy assignments, beneficiary changes and the value of cash borrowed will have an agreement coming from the original beneficiary.
The life insurance company is the one that calculates the policy premiums and prices in order to fund administrative cost, claims as well as profit. The cost of life insurance is being determined with the use of the mortality tables that are calculated by Actuaries. Actuaries are those professionals who are employing actuarial science based on statistics and probability.
Upon the death of the insured, the insurer needs acceptable proof of death in order to pay its claim. It usually includes death certificate and the claim form of the insurer, which is signed and notarized. If ever the death of the insured person is suspicious and the amount of policy is large, then the insurer is required to investigate the circumstances that surrounds the death before they come up with the decision of paying the claim or not.
Life insurance is a great help for everyone because it gives us the feeling of security in our future life. As early as today, it would be better to get one in order to make sure that your family members are secured when the time comes that you will be out in this world. Availing one means that you value the people close to you because you give them something to inherit when you’re gone.
