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Life Insurance And Pension Products

Life Insurance And Pension Products

• In order to effectively regulate the sector, the IRDA has issued various regulations for different types of life insurance products.

• A pure protection plan is a simple risk cover insurance product where the sum assured becomes payable upon the happening of the risk event during the term of the policy.

• A term insurance plan provides a pure risk cover where the sum assured becomes payable upon death of the life assured during the term of the policy.

• A health insurance plan provides a pure risk cover where the sum assured becomes payable upon the life assured being diagnosed of certain identified illness during the term of the policy.

Insurance
[Post Image Courtesy of Hywards at FreeDigitalPhotos.net]

• In Protection cum Savings insurance products, in addition to getting a pure term insurance cover, the policyholder is also able to leverage long term savings.

• An endowment insurance offers death cover if the life insured dies during the term of the policy and also offers a Survival benefit if the life insured survives until the maturity of the policy

• A term insurance plan with an unspecified period is called a whole life plan. A Unit Linked Insurance Plan or ‘ULIP’ as it is popularly known is basically a combination of insurance as well as investments, similar to a protection cum savings plan.

• Variable life insurance is a permanent life insurance policy with an investment component.

• Pure savings and Pension plans address the risk of living too long. In the age of medical advancement where the mortality rates have declined and life span has increased significantly, it is important that the individual saves enough to meet his financial needs during the age when his earning capacity diminishes.

• The Insurance policy is a legal contract between the Insurer and the Policyholder. As is required for any contract there is a proposal and an acceptance.

• The application document that is used for making the proposal is commonly known as the ‘Proposal Form’.

• Policy contract has the same meaning as stated u/s. 10 of Indian Contract Act, 1872.

• A Policy Contract needs to necessarily have all the ingredients as mentioned under Indian Contract Act, the prominent amongst them are communication, acceptance, consideration etc.

Insurance Law And Practice - ICSI

About Author Mohamed Abu 'l-Gharaniq

when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries.

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