Life insurance is designed to assure you that your dependents will Such as your children or spouse, who will be financially cared for in the event of your death. When buying it, there are many things to consider, such as what kind of policy you want, when you need it, and how to buy it.
Two Types of Life Insurance Available
- Pure Protection
- Saving and Protection
Pure Protection Insurance
Is a type of insurance in which company pay some amounts to your family in the your absence.
Saving Plan Insurance
A security and savings plan is a financial tool that helps you plan for your long-term goals. Such as buying a home, funding your children’s education.
Permanent Insurance Varieties
Lifetime insurance offers a fixed death benefit and a cash component that increases at a guaranteed rate of return. Life insurance pay you and minimize your premium payment.
Universal life insurance often offers more flexibility than a lifetime insurance policy. You may be able to change your premium payments and death benefits within certain limits. With a universal life insurance policy, the cash value will depend on the type of policy.
Survivorship life insurance insures two people under one policy, usually a married couple. When both spouses die, the policy pays the death benefit to the beneficiaries. In general, Survivorship is part of a larger financial plan to fund to pay federal estate taxes.
How to Work
Once the policyholder signs the contract, they are required to pay a certain amount to the insurance company on a monthly, quarterly or annual basis. There are several ways to pay your premiums, including by credit card, demand draft, cross check and money order.
Depending on the insurance plan. The company will pay death benefit to the family and / or any other select persons after the death. One of the major benefits of a life insurance policy in Pakistan is that it provides financial support to the deceased’s loved ones. To cover additional expenses as well as funeral expenses and other expenses related to the last rites.
How To Choose The Right Plan
Goals can vary from person to person. You should plan your goals with the help of an appropriate life insurance policy. If financial security of your family is your main goal. You can buy a term insurance plan that offers high coverage at affordable rates.
However, if you do not need lifetime protection. It may be more beneficial to buy term life insurance instead, which gives you protection up to a certain date. As term of policy provides component protection without any investment. The premiums are generally lower than those charged by life insurance.
If you decide that you only need protection until your children grow up and become financially. You may want to consider life insurance instead.
Cost Involve
Like everything in life, you should consider the cost factor when buying a life insurance cover. Check premium, administration and fund management fees, death compensation, riders and how much you need to pay for them. Make sure you compare this type of product before you decide which one is best for you. These days, there are many websites that can help you compare policies and choose the one that is most cost effective for you. Before making your final choice, make sure you read the fine print carefully and you are sure what you are getting.