The insurance market today is buzzing with offerings and policies. There are so many options available that anybody could get confused about which policy to buy and what to rely on. Life insurance is a delicate matter of providing for your loved ones when you are no more around to take care of them; it makes it essential that you obtain the best possible investment advice so you don’t go wrong when your loved ones really need you the most.
Life Insurance acts as financial protection for your family in case of your death or a payment made to you on surviving the policy term. In return for this payment, you make periodic fixed payments to the life insurance company. In certain types of policies, there is an option to get critical illness benefits or create additional protection for your family if you pass away from an accident.
Types of Life Insurance
- Term Insurance
- Fixed term Insurance
- Decreasing term Insurance
- Traditional Insurance
- Whole Life Insurance
- Limited / Modified Life Insurance
- Endowment Insurance
- Non-traditional Insurance
- Universal Life Insurance
- Variable Life Insurance
- Variable Universal Insurance
- Joint-life Insurance
- First-to-die policy
- Second-to-die policy
Annuity:-
An annuity is a contract sold by an Insurance company that guarantees a fixed or variable payment to the annuitant (beneficiary).
Key Concepts of Annuities
- Period certain annuity payments continue for a minimum number of years. If the annuitant precedes a period certain, the remaining funds go to the beneficiary
- Lump sum most common form of settlement chosen by beneficiaries
- Lifetime income beneficiaries spread settlement over a period. However, on their death, payments stop irrespective of money remaining in the account. There is no recourse
- Single payments made to a single person
- Joint made to two people till the death of a first-person
- Joint and last survivor annuity payments till death of 2nd person. May remain level for both or reduced to 0.5 on the death of primary annuitant unless survivor option is there
