There are various factors to be taken into account when selecting life insurance coverage term option, the first of which is the purpose of the policy - for whom is this product intended?
- For the head of the household on whose income the rest of the family depends the purchase of life insurance policy is an excellent opportunity to be responsible, insure and provide for his family members in case he suffers injury or even death. This will give the family the opportunity to stand on their feet and avoid additional unpleasant complications in an already difficult situation.
- Another factor that should strongly influence the decision to buy a life insurance policy is the specific line of work of the individual. For those working in high-risk sectors where the probability of injury is relatively high, then a life insurance would cover the medical costs for example.
- Life insurance is important for those working at home whose contributions are usually taken for granted. This is the typical conception of the work of the housewife in the family. But in case something happens the living costs of the household are most likely to increase, as it will be necessary to hire domestic workers or nannies. Having a life insurance policy is an effective preventive measure against such circumstances.
The right choice of life insurance policy can bring you peace of mind but also provide you with a comfortable and secure investment for the future.
In general the life insurance policies can be divided into two main types:
- Protection policies – they have no savings component and their purpose is to cover against the worst-case scenarios such as death by accident, death in general or occupational disease disability - temporary or permanent. Often in addition to this type of insurance the companies offer supplementary risk package, which usually includes medical expenses, hospitalization costs in case of disability caused by an insured accident. The typical length of coverage for this type of life insurance policy is from 1 month to 5 years.
- Investment policies – they have both protection as well as savings components. This means that the policyholder will receive the sum determined in the life insurance contract even if the insurance event does not occur. Naturally this type of life insurance is perceived as safe and good investment. The insurance premiums can be adjusted over time as per customer's request and the premium is payable either as a single premium upon the signing of the contract or as annual installment payments. The typical length of coverage for this type of life insurance policy is from 1 to 20 years.
Cost is definitely an important factor when selecting the right life insurance coverage term option, so do your research on the different companies' products - there is a lot of well structured information on the web. However in general it is strongly advised to use the services of a life insurance professional before signing any contract. This is a complicated product and an experienced insurance adviser can help you define your needs and make an informed decision.