The need to get an insurance to
ensure security of life to you and every members of your family is an
investment you can venture into to make life more meaningful in case of any
unforeseen eventuality. Insurance is regarded as one of those ‘life’
requirements that you should be looking into early in your career, especially as you are still young and agile and can still
work at any capacity of your choice to earn money.
Another reason why you have to
focus on having an insurance policy now is the fact that you are in a better
position to pay for any insurance policy of your choice and for your
information younger individuals are also giving the privilege to pay less. One
of the principles of insurance policy indicates that once the younger people
are less likely to die they should be given cheaper rates on any insurance
policy they might want to go for unlike older people that paid normal on their
insurance charges.
What is Insurance? This is one of
the important questions that are very difficult to provide answers to by quite
a large numbers of people. This is for no other reason than most people don’t
know its meaning due lack of knowledge about the importance they stand to gain
as they partake in any insurance policy. Insurance has been defined in so many
ways by different group of people based on the assumption of what the term
means to them, but notwithstanding insurance is a means by which you can protect
yourself and every member of your family financially in case of death or any
form calamity or disaster either now or in the nearest future. Depending on the
kind of insurance that you will choose to get, insurance can equally provide
for your health concerns, your retirement, fire or any natural disaster and
even your death or burial.
As much as so many importance are
attributed to having insurance in one’s life to guide against any unforeseen
eventualities, some people still find it difficult to accept this laudable
effort and shy away from availing themselves the opportunity offered by having
insurance on their lifes and preferred having their companies do it for them. Though
if care is not taken there are some legal terms attached to insurance that if
one do not take time to learn such terms what insurance stands for might be too
cumbersome and frightening to understand. And this might even prevent people
from venturing into it.
Listed below are some of the frequently
asked questions about insurance that might be of great help to you.
What are the different types of
insurance available to choose from?
This question has been the major
question posed by different people in an effort to know what insurance is all
about. There are two different types of insurance. They are:
i.
The life insurance; and
ii.
The non-life insurance.
The life insurance, as the name
suggests, is a type of insurance that protects you and every member of your
family in case something unexpectedly happens such as death. When a person who
is insured dies, the claim or money that he insured will be given to the
beneficiary chosen to receive the money.
The non-life insurance on the other
hand is an insurance that protects properties from being damaged without any
hope of survival. There are several different types of insurance under this
category. They are car insurances otherwise known as auto insurance, which protects
automobiles from wreckage in case of accidents or fire disaster. Property
insurance is also meant to protect the properties; this is highly common to
protect factories or industries. This is also peculiar to protect houses from
fire and other forms of destruction. There is also deposit insurance, which
most banks have in order to protect their depositors from losing their money in
case the bank suffers financial setbacks; and health insurance, which helps in
covering for medical and hospital bills and other expenses. Of all the various
non-life insurance, the most popular is the health and car insurance due to the
importance attached to these two insurance policies.
There are equally some insurance policies
designed to provide security for the future. Such types of insurance include retirement
plans and death plans, which at times also covers for burial costs.
What is the difference between a face amount and a premium?
Premium is the amount that you have
to pay every year for the insurance policy you have chosen. And to make payment
of such policy to be easy for their customers some insurance companies have
devise the means of dividing the payment period for premium into monthly
installment purposely to help their clients. The face amount on the other hand
is the amount that you have insured yourself into. For example, if the face amount
in your policy is set at $800,000, then your beneficiary will receive $800,000
when you die.
What is the meaning of double indemnity?
As part of the effort to make
insurance more enticing to their customers, some insurance policy offer an
accidental clause that would double the face amount in case death has been
established as accidental. This is done purposely to protect the insured’s
family in case of any eventuality or untimely death. Double indemnity means
that the face amount of the insured amount will be doubled when death is
accidental.
Is the legal spouse always the beneficiary of insurance?
The answer to this question is “No”;
and this is contrary to the popular opinion. The legal spouse is not always the
beneficiary of any insurance policy. The beneficiary must have been included or
specified while filing the form by the insurer. It is up to the person that
insures to choose. The beneficiary can be any member of the family as long as
insurable interest is established. But one important point to take note of is
that, if the children are named beneficiaries and such children are still not
in legal ages, a guardian has to be chosen for them to take total control of
the money for them till they will attain the age specified by the law to be in
charge.
Thank you.
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