Life Assurance

Insurance is a legal contract that protects people from the financial costs that result from loss of life, loss of health, lawsuits or property damage. It provides a means for individuals and societies to cope with some of the risks faced in everyday life. Insurance when purchased from any of its organization is called a policy.
There are four (4) types of insurance. They include:
• Property and casualty insurance.
• Life insurance.
• Health and disability insurance
• Old age and unemployment insurance.
In life, losses are sometimes unavoidable. People may become ill and lose income or savings to pay off medical bills. Individuals or their relatives may die of illness or accidents. People’s homes or other property may suffer damage or theft. People also may accidentally cause injury to others or damage to the property of others. No one knows in advance when a loss will occur or how serious that loss will be. The uncertainty surrounding potential losses is unpredictable. In the light of this, insurance offers a way for people to replace risk with known costs i.e. the costs of buying and maintaining insurance policies.
Insurance serves many important economic and societal functions. Because insurance is available and affordable, banks can make loans with the assurance that the loan’s collateral is covered against damage. This increased availability of credit helps people buy homes and cars. Insurance also provides the capital that communities need to quickly rebuild and recover economically from natural disasters, such as tornadoes or hurricanes. Insurance itself has become a significant economic force in most industrialized countries. Employers buy insurance to cover their employees against work-related injuries and health problems. Businesses also insure their property, including technology used in production, against damage and theft. Because it makes business operations safer, insurance encourages businesses to make economic transactions, which benefits the economies of countries.
Life insurance as a legal contract provides compensation to specified individuals or groups. These individuals include family members or charities when the policyholder dies. Some policies also provide funds for people to use during periods of their life when they will no longer be able to earn income through work, such as in the final stages of a terminal illness. In industrialized countries such as the United States and Canada, most people must earn a living to provide for themselves and their families. When a wage-earning family member dies, leaving behind the family members, they may not be able to meet financial obligations and goals. Life insurance however, allows people to use some of their earnings to assure that money will be available in the case of death. Individuals can purchase life insurance coverage individually from insurance companies or could purchase coverage as part of a group, such as through their place of employment. Some life insurance policies, known as term life, cover policyholders for a set period of time, or terms. Other policies, known as permanent life, cover policyholders for their entire lives.
For further readings, visit:
http://www.insure.com/
http://www.life-line.org/
http://www.quotesmith.com/