| Life insurance is one of the most important | | | | Endowment policy: Endowment policies are aimed |
| policies that you should take so that you are able | | | | for a particular period. The maturity period can be |
| to leave behind enough financial security to your | | | | in sync with your goals like your child's marriage, |
| family, in case of your unfortunate death. If you | | | | overseas trip, retirement planning, college |
| are married or have dependents who look up to | | | | education etc. While term insurance is for a |
| you financially, it is a must to take life insurance | | | | particular period of time like 10 year or 20 years, |
| policy. There are three main types of insurance | | | | or so on, the whole life policy covers you for |
| policies that you need to know: | | | | your entire lifetime; you are covered, no matter |
| Term Insurance: Term insurance is the most | | | | when death comes. Endowment policies are like |
| common and basic life insurance policy. You get a | | | | term insurance when it comes to policy tenure |
| sum assured amount on your death, which is | | | | (10 years, 20 years etc) but you get back |
| handed out to the person you nominated for in | | | | returns over your investment if you survive the |
| the insurance agreement. So here, you have to | | | | policy term. Endowment insurance policies have |
| determine how much the life cover should be, the | | | | high premiums among all these three common |
| policy tenure etc. The premium money that you | | | | forms of life insurance. |
| pay for this kind of insurance is the lowest among | | | | Decreasing term insurance: There is a fourth type |
| all life insurance products. However you do not | | | | of life insurance policy, linked to term insurance, |
| get back any money if you survive the term of | | | | also known as 'decreasing term insurance' |
| the policy. | | | | associated with mortgage. This is beneficial if you |
| Whole life policy: Whole life insurance policy is | | | | are taking mortgage and you have money |
| supposed to insure you for the entire life. So, it is | | | | outstanding. You should take this insurance when |
| an investment as well as life cover. So when you | | | | you take mortgage. The amount is insured for |
| pay your monthly premiums, a part of it goes | | | | the entire mortgage term. When you pay off the |
| towards savings and builds up as cash value while | | | | mortgage amount, the money remaining on the |
| the other goes toward protecting your life. You | | | | insurance policy decreases till there are no more |
| can borrow money against this cash value which | | | | obligations. In case, you die during the term of the |
| builds over a period of time. Whole life policies | | | | policy, the money towards insurance is paid by |
| mature after an individual turns 100 years old. At | | | | the insurance company. |
| that time, the insurer will pay you the face value | | | | Check with your insurance company about |
| (or the amount the insured has built over a period | | | | various types of life insurance policies and choose |
| of time). If the policy holder dies before this | | | | the ones that serve your purpose to the |
| period, he can get the sum assured as well as the | | | | optimum. |
| returns over investment. | | | | |