Life assurance is a contract between the insurance buyer and the insurance company, where the insurance company consents to pay a certain amount of money upon the incident of the insured individual's or individuals' termination or other event, such as terminal disorder or critical affliction. In return, a person needing insurance consents to pay a stipulated amount called a premium, at recurrent intervals or in lump sums. In some cases bills and death costs plus catering for after funeral costs ought be included in the insurance policy Premium. In the u.s., the predominate form simply specifies a lump sum of cash to be given on the covered's passing.
As with most assurance documents, life insurance insurance is an agreement between the insurance company and the insurance buyer whereby a benefit is paid to the designated beneficiaries if an insured occurrence occurs which is covered by the policy. To be a life insurance policy the covered action needs to be based upon the lives of the people approved in the policy.
Life Assurance policy owner events that are sometimes covered in the policy include:
Grave affliction
Life policies are legal contracts and the terms of the contract specify the limitations of the insured events. Certain exclusions are often penned into the contract to limit the liability of the insurance company; i.e., claims relating to suicide, fraud, war, riot and civil commotion.
Life insurance contracts are mostly two types:
Protection documents - set up to arrange for a benefit in the occurrence of certain happening, typically a lump sum of cash pay out. A common form of this design is term life assurance.
Investment documents - where the main objective is to contribute to the growth of capital by regular premiums. Some other common forms (in the United States anyway) are whole life, universal life and variable life documents.
