How to buy Life Insurance, works and types

April 8, 2019

In today’s era life can also be insured. If any of your life (parents, child, siblings or any other) depends on your income, then you must be taking a life insurance policy. Life insurance can be bought in many ways, such as ULIP, traditional plan and term insurance plan. Life insurance provides protection to the family members in the case of miss happening. In other words, in the case of death of the insured, what prevents the family from the loss of income is called life insurance. When every other person lives in a house for a loan, then in this condition, the need for life insurance also increases. 

In the simplest language Term Insurance is an insurance product that provides the sum insured to the family in the case of the death of the policy holder. In the case of insurance policy time duration period given and the policy is active or in force then death benefit is paid. If the life insurance holder does not die during the policy term, then holder does not get anything at the time of expiry.

Types of Life Insurance
The main types of life insurance are:
1. Term Insurance = This is very cheaper insurance then than other life insurance plans. In this only Life Insurance cover is given and no part of premium or premium paid is invested.
2. Endowment Plan= The major different between term plan and endowment plan is the maturity benefit. This means that when the policy is maturing at the expiry of the term of the policy, the insured gets added bonus along with the sum insured. Bonus is declared annually in the policy term. The endowment plan premium amount is more comparison to the term plan.
3. ULIP Unit Linked Insurance Plans= ULIP complete the needs of both insurance and investment. In the ULIP the money you invest is deducted by the premium given. You can also check your investment according to its performance during the policy period and transfer it to another fund.
4. Money Back Policy = Money back policy is actually a form of endowment plan, in this policy a fixed portion of the sum insured is paid to the insured during a certain period of time during the insurance period time.

How Life Insurance works
During the period of insurance, the sum insured is paid to the nominee on the death of the insured. In the saving plan, the maturity value is paid to the insured at the end of the plan period. To continue insurance during the insurance period, the prescribed premium of insurance has to be deposited. Even after the payment of the premium paid up to the due date, the insurance cover can also be removed as per the policy plan rules.   

How to buy Life Insurance
It is very easy to buy insurance. If you know an insurance agent you can meet him or you go to the insurance company’s website or you can call the insurance company’s toll free number. But when buying life insurance, you must obtain information about that insurance company from which you want to take insurance. In the name of some insurance companies you are asking for insurance if you want to choose from them.  

Best Life Insurance Company
1. Life Insurance Corporation of India
2. SBI Life Insurance
3. Bajaj Allianz Life Insurance
4. Birla Sun Life Insurance
5. HDFC Standard life Insurance
6. ICICI Prudential Life Insurance
7. Reliance Life Insurance
8. Sahara India Life Insurance
9. Kotak Mahindra Old Mutual Life Insurance
10. Bharti Axa Life Insurance Co

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