Essential terms for life insurance terms

Everybody knows life insurance protection is of paramount importance for you. When you visit a life insurance advisor, it is quite likely that he will use some life insurance terms that may be unfamiliar to you. In this case, ignorance is not bliss. It is very important you appraise yourself with some important life insurance terms, so that no unscrupulous broker can take you for ride. It will also allow you to choose the most appropriate life insurance protection to fulfill your needs.

• Beneficiary: People who have been named in the policy to be eligible for getting the earnings of your policy, if you die.
• Cash or Surrender Value: The cash amount against which you can get a loan and which is available for withdrawal in case of urgency. If you choose to use this value, your death benefit goes down and increases the likelihood of policy lapsing.
• Sum assured: It is the smallest amount assured to the policy owner. It plays an important part in deciding the amount paid as premium. In case of your death, the policy holder gets minimum of this amount.
• Premium: The amount you have to pay to the insurer so as to avail life insurance protection. It depends on your age, kind of insurance policy selected and your health status.
• Endowment policy: A policy which is a combination of life insurance protection as well as investment. It invests the monies in debt instruments. The life cover is in vogue till the policy matures.
• Policy term: Period during which you have to pay premiums to enjoy life insurance protection.
• Term policy: A policy providing just the life covers without any investment aspect. There are no returns on this policy, making it the cheapest policy.
• Whole life policy: A policy providing life insurance protection till your death, as well as returns on the premiums paid. The premiums are invested in different debt instruments.
• Unit link insurance policy: A policy with life insurance protection and returns on the premiums paid. Here the corpus is invested in debt, equity or a mixture of both. Policy holder has the option of deciding where his premiums are invested. This is one of the most expensive insurance plans in the market.
• Policy holder: The person named on the policy bought. It may be the person paying the premiums or a person who receives an insurance policy as gift.
• Paid-up policy: A policy that is in vogue but there are no more premiums paid.
• With profits policy: A policy where the insurance company awards the policy holder a part of its profits as bonus. Bonuses can be either yearly or on the expiry of the policy.
• Policy loan: A loan given by the insurer to the policy holder from its general funds. It uses the policy’s cash value as collateral for the loan.

Know these common life insurance terms and you will get the best insurance policy for your need.

Article Source: http://www.orbitaloc.com/

You will find more detail information about the Life Insurance Terms and Life Insurance Protection on our website www.bharti-axalife.com

Please Rate The Above Article From The Finance & Investment Category
Article Title: Essential terms for life insurance terms

5 out of 54 out of 53 out of 52 out of 51 out of 5 

Not yet Rated

Syndicate Finance & Investment Related Articles Via RSS!

Boost your websites' search engine ranking! Attract more repeat visitors!
Automatically, consistently update your content via Really Simple Syndication (RSS). To syndicate the above article and other Finance & Investment related articles on your blog or site, simply click on the XML Icon above to grab the RSS feed -- It's FREE!

Subject to Orbitaloc.com's Publisher Terms of Service, you may reprint this article on your own website, blog, and ezine. (English only) You may also syndicate the article via Really Simple Syndication (RSS). It is free of charge.

Free Articles on Finance & Investment and Other FREE Content Article Topics
The preceeding is an informative article from the Finance & Investment category.

Visit Our Sponsor for 2 Free Quarts of Liquid Vitamins