What is Life Insurance: Types, Advantages and Disadvantages
We warmly welcome you to this latest article on Jeevan Bima Bazaar. In our previous article, we got detailed information about different types of insurance. In today's article, we will learn about life insurance in detail.
The important thing is that here we are not sharing any information in bookish language. Rather, we try to present information about life insurance through such simple words and sentences. So that you get accurate information about it and you can take a right decision.
Introduction to Life Insurance:
To understand Life Insurance, you have to understand the financial crisis of a family. So for this you imagine there is a family with six members. Whose one member earns and all the financial needs of the other members depend on the earnings of this one member.
In this family, the earning person has two children, who are pursuing primary education. This person's parents are elderly and all their needs are fulfilled by this person. The wife completes the household chores.
Now suppose, this member of the family dies due to any reason. So what can be the impact of such an incident on the family?
It is possible that the education of the children will stop or the family will have to compromise for this. Meeting the needs of an aging parent can be difficult. The family may have to struggle a lot for the basic needs like food, clothes, house.
Life Insurance is arranged to save the family from financial losses due to any such untoward incident. If the head of the family buys an Life Insurance Policy for a certain amount from any Life Insurance Company and the headman keeps on depositing the Premium installment of his Life Insurance Policy. In this case, if the headman dies, the life insurance company pays the sum assured to his dependents.
Types of Life Insurance:
To understand the type of life insurance in present times, it can be divided into two parts. In the first part, you can divide life insurance on the basis of their basic format i.e. structure of life insurance plans and in the second part you can divide these plans on the basis of need fulfillment capabilities i.e. what needs can these schemes fulfill? . Let us understand it one by one.
Types of Life Insurance (Based on the Design of the Plans):
The design of Life Insurance Plans means for how long it provides life insurance cover, what is the premium payment method, what kind of benefits it provides on maturity, etc.
On the basis of the design of the plans, Life Insurance is of the following types:
- Term Life Insurance Plan
- Endowment Life Insurance Plan
- Single Premium Life Insurance Plan
- Limited Premium Life Insurance Plan
- Money Back Life Insurance Plan
- Unit-Linked Life Insurance Plan
- Whole Life Insurance Plan
- Group Life Insurance Plan
Types of Life Insurance (on the Basis of Need Fulfillment):
Any Life Insurance Company launches its Life Insurance Plans in the format mentioned above. These schemes can also be divided on the basis of needs.
- Life Insurance Plan for Financial Security
- Life Insurance Plan for Children's Education
- Life Insurance Plan for Marriage of Children
- Life Insurance Plan for Retirement
- Life Insurance Plan for Loan
- etc
Note: We will get detailed information about this in the next articles.
Benefits of Life Insurance:
There are many benefits of buying a Life Insurance Policy. Let's know it in detail.
Life Insurance Plans Provide Financial Security:
Life Insurance Plans provide Financial Security to the family. After the death of the insured, his family gets the sum assured from the life insurance company. The family can use this money to get a New Job for themselves, or repay the old Loans, or meet the needs like Education and Marriage of the Children.
Life Insurance Plans provide Peace of Mind:
It is often seen that a person who buys a Life Insurance Plan has a Happy Life. The main reason for this is that when he knows that even in his absence, his family members will not have to face financial problems, because the Financial Needs of his family will be fulfilled due to the Life Insurance Policy.
Life Insurance Plans Provide Income Tax Benefits:
On depositing the premium of Life Insurance Policy, customers get Income Tax Benefits and Maturity of such policy is Tax Free.
Download File:
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Disadvantages of Life Insurance:
Life Insurance Policies also have some disadvantages. If you are deciding to buy a life insurance policy then you must understand it carefully. For example: The premium of life insurance policy is very high in many circumstances, life insurance companies sometimes reject the death claim under certain conditions, sometimes the customer does not understand that on the maturity of the life insurance policy and the death claim But how much will he get paid?
We will get detailed information on this topic in our upcoming articles.
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