What is life insurance?
Life insurance is the binding contractual agreement between a life insurance company and an insured person that typically protects those who are financially dependant on the insured. The agreement between the insurance company and the insured, known as a policy, provides details and stipulations about who should be provided cash payment as compensation in the event of the insured’s death.
Life insurance is an agreement between a life insurance company and the policyholder. Under the terms & conditions of the policy, the life insurance company agrees to the payment of a stated amount of monetary benefits to a named beneficiary, on the happening of a specified event contingent on the human life. Usually the agreement provides for :- Payment of an amount by the life insurance company on the date of maturity or at specified periodic intervals or at death, if it occurs earlier.
Life insurance is a contract between an insurance company and the insurance policy owner(s). The insurance company pays a cash amount or death benefit to the beneficiary(s) named in the policy upon the death of the insured named in the policy. Purposes of life insurance include providing financial security, funding business continuation and satisfying estate tax requirements among others. The two main types of life insurance policies are term life insurance and permanent life insurance.
