The Importance and Benefits of Life Insurance Policies
Life insurance policies are considered to be an essential part of any individual's investment portfolio. It is not necessary that life insurance is availed solely for the benefit of accumulating wealth, but it is purchased in order to safeguard the financial security of the future. Moreover, some people buy life insurance policies for other benefits such as long-term capital gains and tax-deduction options.
One must always be cognizant of the fact that insurance policies are primarily a tool that will enable a person in his endeavor to afford his family members and dependents to lead the same standard of life in the unfortunate event of his demise. The numbers of companies in the market offering life insurance policies are myriad. And if one considers oneself to be an amateur in financial understanding, falling for the 'shock the awe' of an insurance agent is the foremost thing to avoid. As going for any insurance product without proper deliberation and research might lead to a loss-both in terms of money and security.
The first thing that one must do before even asking for a quote from an insurance agent or an insurance company's websiteis to understand the current financial status of your own self. The financial commitments made and the future liabilities that might accrue should also be considered. It is after this that one should decide which policy will best suit the needs in the long-term. Most pundits propagate this idea that insurance is one of the best and safest avenues as it combines savings with investments.
Part-time students and new employed people view life insurance policies as a profitable scheme that helps them to regulate their saving endeavors. Some of the important factors an individual needs to understand before buying any life insurance policies are listed below.
a) Term of the policy
b) Requirement (Sum Assured)
c) Coverage of the policy
d) Benefits and nature of the policy
The income and need of an individual will help in deciding the life insurance premium one is capable of paying. The benefits that will accrue to the survivors of the policyholder must play a major part in deciding between policies of different insurance providers.
A life insurance policy covers the risks of loss that occurs in the event of the demise of the insured. Hence it is prudent, prior to purchasing the policy, to understand the plan detailed in the policy. Almost all life insurance providers offer a ULIP (unit linked insurance plan) to their customers. Due to this reason, consultation with an expert or someone with adequate knowhow becomes important. Self-induced research on the internet is also a welcome step in this direction, as it will help to wash-out various canards.
One must always be cognizant of the fact that insurance policies are primarily a tool that will enable a person in his endeavor to afford his family members and dependents to lead the same standard of life in the unfortunate event of his demise. The numbers of companies in the market offering life insurance policies are myriad. And if one considers oneself to be an amateur in financial understanding, falling for the 'shock the awe' of an insurance agent is the foremost thing to avoid. As going for any insurance product without proper deliberation and research might lead to a loss-both in terms of money and security.
The first thing that one must do before even asking for a quote from an insurance agent or an insurance company's websiteis to understand the current financial status of your own self. The financial commitments made and the future liabilities that might accrue should also be considered. It is after this that one should decide which policy will best suit the needs in the long-term. Most pundits propagate this idea that insurance is one of the best and safest avenues as it combines savings with investments.
Part-time students and new employed people view life insurance policies as a profitable scheme that helps them to regulate their saving endeavors. Some of the important factors an individual needs to understand before buying any life insurance policies are listed below.
a) Term of the policy
b) Requirement (Sum Assured)
c) Coverage of the policy
d) Benefits and nature of the policy
The income and need of an individual will help in deciding the life insurance premium one is capable of paying. The benefits that will accrue to the survivors of the policyholder must play a major part in deciding between policies of different insurance providers.
A life insurance policy covers the risks of loss that occurs in the event of the demise of the insured. Hence it is prudent, prior to purchasing the policy, to understand the plan detailed in the policy. Almost all life insurance providers offer a ULIP (unit linked insurance plan) to their customers. Due to this reason, consultation with an expert or someone with adequate knowhow becomes important. Self-induced research on the internet is also a welcome step in this direction, as it will help to wash-out various canards.
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