What are the features of life assurance explain?

What are the features of life assurance explain?

A life insurance policy is basically an agreement between an individual and an insurance service provider. According to this contract, the insurance provider is obligated to pay a certain predetermined sum of money upon the demise of the individual. This sum is paid to the said individual’s nominee.

What are the main characteristics of a life insurance contract?

Features of Life Insurance Contract

  • Nature of General Contract.
  • Insurable Interest.
  • Utmost Good Faith.
  • Warranties.
  • Proximate Cause.
  • Assignment and Nomination.

What are the 2 main types of life insurance What is the difference?

The two main categories of life insurance are term life insurance (which lasts for a set term) and permanent life insurance (which never expires). Whole, universal, indexed universal, variable, and burial insurance are all types of permanent life insurance.

What are the 3 types of life assurance?

There are three main types of permanent life insurance: whole, universal, and variable.

What are the features of LIC?

Features of LIC

  • As a Savings Institution. Life insurance mobilizes as well as promotes the savings in the country.
  • Investment Institution. A large part of an investment by LIC is in government securities.
  • Stabilizes the Share Market.
  • Loan finance defects.
  • Dependency on institutional sources.

What are the important features of LIC Act 1956?

The LIC was established with the following objectives: Spread life insurance widely and in particular to the rural areas, to the socially and economically backward claries with a view to reaching all insurable persons in the country and providing them adequate financial cover against death at a reasonable cost.

What are the special features of insurance contracts?

When attempting to get a better understanding of insurance, there are four unique characteristics that need to be done and they are conditional, unilateral, adhesion, and aleatory. Let’s take a closer look at each of these unique characteristics as well as the traits that define them.

What are the 4 characteristics of insurance?

Basic Characteristics of Insurance

  • Pooling of losses.
  • Payment of fortuitous losses.
  • Risk transfer.
  • Indemnification.

What are the differences in life insurance?

Term life is “pure” insurance, whereas whole life adds a cash value component that you can tap during your lifetime. Term coverage only protects you for a limited number of years, while whole life provides lifelong protection—if you can keep up with the premium payments.

What are the different types of life insurance policy?

Overview of Different Types of Life Insurance

Types of Life Insurance Policies Overview
Endowment Life Insurance Policy Provides the combined benefit of life insurance cum saving.
Money-Back Insurance Policy Provides periodic returns along with the benefit of life insurance cover.

What are the main types of life assurance?

Common types of life insurance include:

  • Term life insurance.
  • Whole life insurance.
  • Universal life insurance.
  • Variable life insurance.
  • Indexed universal life insurance.
  • Simplified issue life insurance.
  • Guaranteed issue life insurance.
  • Group life insurance.

What are the types of life assurance?

There are three main types of term assurance to consider – level-term, decreasing-term and increasing-term insurance.

Which of the following is not a feature of insurance?

Lending funds is not a function of insurance. Among the given options option (c) lending funds is the correct answer. Explanation: The main functions of insurance are : Protection, Risk sharing , Asset in capital formation, Providing certainty.

What do you mean by life insurance contract?

Life Insurance can be defined as a contract between an insurance policy holder and an insurance company, where the insurer promises to pay a sum of money in exchange for a premium, upon the death of an insured person or after a set period.

What is LIC and its features?

LIC is known as India’s largest government-owned life insurance and investment corporation. The main role of LIC is to invest in global financial markets and different government securities after gathering funds from people through their various life insurance policies.

What are the important features of LIC?

What are the main features of LIC?

  • The main features of LIC are given below:
  • Saving Institution:
  • Term Financing Institution:
  • Investment Institutions:
  • Stabiliser in Share Market:
  • Dependence on Institutional Sources of Finance:
  • Defects of Loan Finance:
  • Small Industries Ignored:

What are the important features of insurance contract How is insurance beneficial to individuals?

Following are some of the important benefits of insurance: Provides peace of mind: Insurance provides protection against various uncertainties that can put you or your family in financial crisis. By covering the uncertainties of human life and businesses, insurance provides a sense of security.

What are the salient features characteristics of insurance?

Characteristics/Features of Insurance: 1.It is contract for compensating losses. 2.It is contract of good faith. 3. Premium is charged for insurance contract.

What are nature and characteristics of insurance contract?

Insurance contracts are unilateral; the insured performs the act of paying the policy premium, and the insurer promises to reimburse the insured for any covered losses that may occur.

What is the difference between life insurance and term life insurance?

Term life insurance provides coverage for a set period of time, typically between 10 and 30 years, and is a simple and affordable option for many families. Whole life insurance lasts your entire lifetime and also comes with a cash value component that grows over time.

What are the features of life insurance contract?

Followings are the features of life insurance contract: In life insurance contract the first three features are very important while the rest of them are of complementary nature. 1. Nature of General Contract Since the life insurance contract is a sort of contract it is approved by the Indian Contract Act.

What is life assurance and how does it work?

The meaning of life assurance is that it is not a fixed-term product — it’s intended to cover you until you pass away, whether that’s weeks or decades after you’ve bought the policy. Life assurance is often sold as ‘whole of life’ or permanent insurance, and comes in many forms.

What is the difference between fixed-term and Life Assurance?

The fact the cover is for the whole of your life means the insurer is more or less guaranteed to have to make a payment, so the premiums for life assurance are generally higher than for a fixed-term life insurance policy that might never result in a claim.

Should I extend my life assurance policy?

Frequently, people take out life assurance because they want their dependants to be able, for example, to cover housing costs if the worst situation were to occur. But given that the average mortgage is paid off after 25 years, it may not be necessary to extend life cover beyond this.