Life insurance: about its types and opportunities

About important issues in life insurance

By taking out life insurance, you make sure your loved ones are safe even in the face of an invisible tragedy. It matters which contract and how you sign it.

Important questions before taking out life insurance

Your own needs

Do you need the service as an individual or business?

Determine what your expectations are when you feel safe. Also, specify what kind of service do you expect? (Lump sum payment or annuity service)

Since there are several types of life insurance, you must know what purpose you want to achieve with it. Before concluding a contract, it is also necessary to be aware of your own possibilities, ie what still fits into the framework, as well as your own needs, ie with what you are reach your goals.

Family budget issues

Are changes in the family budget expected? It could be either the birth of a child or the retirement of a family member. On the one hand, it determines how much you can take as a regular fee, and it also limits the risks you face.

Is there a main earner in the family or business?

If there are people in your family without whose earnings you would have a very hard time making a living, or if there are key people in your business, you definitely need to provide them.

In the case of a family, this ensures that the heirs do not end up in a difficult financial situation. In the case of a business you can also use e.g. in the following situations:

in the case of an owner, preparation for inheritance
for key people an extra benefit
in the case of a corporate beneficiary, replacement of the revenue generated by the key person

Are there any activities that could put you at increased risk?

It can be either a lifestyle or a work activity. If there is one, the insured event is also more likely to have occurred.

What is included in the life insurance contract?

Before you just sign, review carefully what risks the contract covers. What is the event you pay for and to what extent you pay. Does it include everything that is important to you and provides enough coverage for you?

Contractual risks

Like everything, this kind of insurance can have risks. These risks are mostly related to the payment of fees. In any case, it doesn’t hurt to be aware of it.

How to terminate a life insurance contract?

The most common case is a termination claim when, for some reason, you are no longer interested in maintaining that contract. This may be the case, if you:

have found a better value for money solution
no longer need that much coverage because your goals have changed (you have achieved the goals that made the contract necessary before)
may not be able to sustain it due to a negative change in your life situation

You can terminate the contract at any time by mutual agreement. Of course, that doesn’t mean it’s always worth it. This is described in more detail in your contract description. For your contract of indefinite duration, which is renewed annually, your notice must be received by the insurer at least 30 days before the round.

Types of life insurance

There are also several types of insurance, within which life insurance is not a single category.

Whole Life life insurance

This version has no expiration date.
In this case, the insurer undertakes to pay the pre-determined amount to the person or persons designated as beneficiaries in the event of the death of the insured person.
The primary purpose of this option is to ensure that heirs do not find themselves in a distressed financial situation, e.g. by inheriting a bank mortgage. This is why risk life insurance is also used as credit protection.

As this variant ceases with the death of the insured (possibly by mutual agreement), it is called whole life insurance.
It is typical for insurers to limit the age of entry and the payment of premiums to an upper age. As this is different from our insurer, this is just one example of this: the oldest customer with whom you still have a contract can be up to 75 years old and can pay premiums up to 80 years old. Then, of course, the contract continues to run, but either with a declining rate of service or otherwise limited.

Term life insurance

The insurer would then undertake to pay a pre-determined amount either to him or to the beneficiary if the insured is alive at a given moment. If the insured dies in the meantime, the accumulated amount is due to the beneficiaries or heirs.

Mixed life insurance (also known as insurance combined with savings)

It is a combination of risk and access life insurance. The insurer pays in two cases:

if the insured is alive at maturity, he will receive the accumulated amount and a part of the proceeds either by him or by the beneficiary (the insured may also be a maturity beneficiary)
if the insured dies in the meantime, the beneficiary or, failing that, the heirs will receive the risk life insurance premium, as well as the amount accrued so far and part of the proceeds. (death beneficiary can no longer be the same as the insured one)

In this case, part of the fee is invested, the rest is covered by their expenses. In this case, the insurer guarantees the client a certain achievable result and redistributes a significant part of the return on the investment to the client.

However, this does not mean that you would achieve a high return, as the insurer applies technical interest, which in many cases is maximized even by the central bank.

After comparing the costs, this solution may be suitable in addition to risk life insurance to ensure the financial security of your family. Because of the maximum return, I do not consider it the best choice for long-term investment, as this achieved return does not necessarily exceed or even reach the current level of inflation. Because of this, the purchasing power of your money can steadily decline.

Unit-linked insurance

You can read more about unit-linked insurance on the Silver Moon page, so now just a summary.
With unit-linked life insurance if properly managed, you may already be able to not only get risk life insurance, but also see long-term positive results on your investment.
The options inherent in unit-linked life insurance also vary from contract to contract, so contact us before you choose to help you choose the right one for you.
If you feel you have a lack of financial knowledge, be sure to ask for help. We will then show you either the managed portfolio or the sample portfolio compiled by the insurer that corresponds to your own level of risk. This will reduce your own risk.

Supplementary insurance to life insurance

Accident insurance, service insurance in case of disability

Provides service at the case of disability or accidental injury.

Accidental death insurance

If this exists, in addition to the normal life insurance indemnity, the insurer also pays the indemnity amount in the event of death due to an accident.

Sickness insurance

Reimburses in case of illnesses and hospital care.

Insurance for dreaded (critical) diseases

If you have a critical illness in your family (cancer, heart attack, brain disaster, etc.), or you consider yourself to be at particular risk for any reason (working conditions, lifestyle, etc.), it will increase your safety if the insurer still reimburses you.

Questions:

Why do you choose insurance for yourself?
As an entrepreneur, both as a business leader and as an individual, do you review the issue?
How often do you review your existing contracts?

If you have any questions, ask in the Contact menu. I like to read your views and comments in the comments of social media.

Life insurance