Life Insurance Policy Provisions
Understanding Your Life Insurance Policy Provisions
What is life insurance and why is it necessary? This is a very normal question asked by most of us. We always think that maybe it’s a waste of time and get irritated by the numerous agents who try to sell these policies to us.
With insurance we make sure that the life of our people remains tension free even after our death. With insurance we get some monetary benefits on our life which relieves us of the tensions of family even after our death. So after this we should realize how important an insurance is for our better future.
Types Of Life Insurance
We don’t have just one type of life insurance but we have choices in this area which makes it a very competitive environment for the agent and confusing for the customers. The different types of life insurance policies include term life, whole life, cash value, single premium life insurance, Universal life and variable universal life insurance. Now each has a variety of clauses included. Maybe two or more of the insurance may contain the same things but might include something which is different.
Term life provides insurance at an inexpensive premium. You just have to pay a premium and no extra money is required. At the end of the term you get whatever amount your life insurance is worth. You are not risking any money at the same time you are getting insured. You will have to pay the premium every term. Your health problems and other types of life endangering problems are also insured with term life.
With cash value or in other words the permanent life insurance you need to shell out some extra money to get the insurance. But you get tax and other monetary benefits along with insurance benefits. Your age and other health related details are taken into account like all insurance while calculating your period and premium. The basic form of cash value insurance is the whole life insurance.
Single premium life insurance is where you don’t need to pay any more then the one time premium you have already paid. You just need to have a savings account where the money would be kept and you would need to pay a little amount whenever you remove money from that account.
Universal life is a larger picture to the whole life insurance. Here one can also make investment in life insurance as well as get some benefits of savings account. The variable life and variable universal life are just an extension to this.
Life Insurance PolicyProvisions
There is only a period of time till which you are eligible for the benefits of a life insurance policy post which you might not be able to get the benefits. This provision is generally named the incontestable provision by the commercial law.
A suicide provision which is included in the provision list means if somebody commits suicide within a certain period of the start of the policy they might just get the premium and interest amount and not the entire insurance money. Only after the period mentioned in the clause can they contest for insurance money.
Reinstatement provision deals with payment of premium on time. When you fail to pay it in time you get some grace period for the payment so that your policy remains secure.
Certain times certain causes of death are not covered under an insurance policy. You need to make sure which clauses are not covered. This is called the excluded risk provision.
Compare Your Life Insurance Options Now!
While applying for a life insurance policy remember to take into account all the points mentioned in the clauses. You need to check out if it is really beneficial because there might be a lot of hidden clauses in the insurance policy.
Compare life insurance policies now by using our free life insurance quote finder!
