What is life insurance? Proper understanding of life insurance to ensure benefits

 

Although life insurance  is not new, the questions of what life insurance is, the nature of life insurance, current types of insurance and life insurance benefits... are still quite new. with many people.

I. What is life insurance?

Life insurance is a product of insurance companies to protect people against risks related to health, body and life. Simply, the participant agrees and signs an insurance contract with the insurance company about paying the correct fees regularly into the financial reserve fund managed by the insurance company to get the most payment. at the time of bad luck or maturity.


An insurance contract is an agreement between an insurance buyer and an insurance enterprise, whereby the insurance buyer must pay a premium, the insurer must pay the insurance premium to the beneficiary or indemnify the beneficiary. insurance when the insured event occurs (According to Clause 1 - Article 12 - Law on insurance business).

The essence of life insurance  is a safe way of providing financial protection for the future with the aim of replacing income sources when the participant encounters unexpected risks (life insurance benefits).

Therefore, life insurance is of great significance to human life, it not only helps stabilize life when unexpected risks occur, but also a way to share risks in the community by taking complement the few.

II. Types of life insurance



  • Term life insurance is an insurance profession in which the insured lives up to a certain term, under which the insurer must pay the insurance premiums to the beneficiaries, if the insured still lives to the specified term. agreed in the insurance contract.
  • Term life insurance is an insurance practice for the death of the insured within a certain period, whereby the insurer must pay the insurance money to the beneficiary, if the insured dies within the specified period. agreement in the insurance contract.
  • Periodic payment insurance is an insurance business in case the insured lives up to a certain term; After that time limit, the insurance enterprise must periodically pay premiums to the beneficiaries as agreed in the insurance contract.
  • Mixed insurance is a combination of term insurance and term insurance.
  • Whole life insurance is insurance coverage for the death of the insured at any time during his or her life. (excerpt from Clause 12 - Article 3 - Law on insurance business)

In fact, in order for customers to easily access and learn about insurance, companies classify insurance products according to the actual financial needs of customers, for example, life insurance products. Manulife has life  insurance, health insurance, savings insurance for education, savings insurance for retirement and investment products.

Currently, there are many people who do not really understand the product and insurance benefits correctly, so they have caused unnecessary confusion. So what is the correct understanding of life insurance?

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