Characteristics of Life Insurance Products

Thursday, May 31st, 2012 - Insurance

Characteristics of Life Insurance Products

Life insurance products can be grouped according to period, the traditional life insurance products and insurance products of modern or more familiar with the Unit Link. By knowing the difference between these two products may help you know more about Life Insurance. Characteristics of Life Insurance Products

The characteristics of traditional life insurance products are:

Large premiums and coverage of money fixed (constant) since the inception of insurance until the expiration of insurance.

Characteristics of Life Insurance ProductsPredetermined schedule of premium payments, for example, every year, six months, three months or monthly.

Since the contract began the policy cash value is known.

Composition of costs, Mortality tables and interest rates are not specified and is not known by the prospective policyholder.

Large interest rate enjoyed by the policyholder is constant throughout the insurance contract. Characteristics of Life Insurance Products

As for the modern life insurance products have the following characteristics:

Composition of the premium specified separately between pure insurance premiums, fees and interest rates. All the details are known by the prospective policyholder.

Premium payment period and the magnitude of the sum insured can be fickle, and did not have a fixed schedule, because modern life insurance product allows the addition of the premium at any time.

This product requires the administration to be more complex than traditional life insurance products, and therefore this product has the premium for a substantial investment and should be done professionally.

Prospective policyholders should determine where the funds (premium) invested, such as stocks, bonds, money market, deposit and so on.

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Cash value of this policy is determined by the performance of the investment committee of a life insurance company that manages, so that policyholders do not know exactly how much cash he would receive if canceled (lapse).

Characteristics of Life Insurance Products

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