A life assurance policyholder pays a certain amount of money in his or her lifetime to an insurance company to 
safeguard their future or the future of their dependants. People do this by paying the insurance company a premium either at regular intervals or in one sum depending on the type of life assurance policy. In the event of the policyholder’s death, his or her dependants receive the stipulated amount that has been paid for in the policyholder’s lifetime, which helps greatly especially in case their children are young and incapable of looking after themselves.
Note: Term or Whole Life Comparison
Some life assurance policies pay back the premium paid during one’s lifetime in case of illness or any grave injury according to the agreements in the policy. There are various kinds of life assurance policies and before taking one, the policyholder should discuss all the pros and cons at length with their insurance agent, and fill out the life assurance form honestly, as there could be repercussions later such as non-fulfillment of claims.
Different life assurance products can confuse the individual who wants an insurance policy, hence choosing the right agent from a reputed insurance company helps settle qualms arising when making these choices. The most common life assurance product is the term policy, where you receive nearly 80% of your premium in case of any illness befalling you. In the case of death, the beneficiary gets the money that you have insured, provided it is within the period specified by your life assurance policy.
A whole life assurance policy allows the insurance company to invest your money in funds. Since you pay out more than the amount, you insure yourself. These rates change every 10 years and once you cross 65, you may have to pay premiums while the amount invested as stock in your name may or may not yield proportionate dividends. This is not a very popular life assurance policy unless you have many estates and are wealthy enough to want your dependants to reap maximum benefits from the estate.
Mortgage protection insurance and mortgage repayment protection are different types of life assurance products available with life assurance companies, which deal with repayment of loans for your home. There are several options with these types. Get the best life assurance deal as you shop around and always make sure you read the fine print at the bottom of any life assurance policy that you sign, as most often there are hidden catches, not spelt out by the insurance agent. Income protection insurance gives you cash benefits in case you are unable to work due to some serious illness and if you are self employed. The amount is non-taxable as long as your condition does not improve. Critical or serious illness insurance, on the other hand, will pay you a lump sum if you have one of the serious illnesses specified in your life assurance policy at the time of filling out the form. When choosing a policy, make sure you compare the costs against benefits before signing on the dotted line.
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