What is life insurance?
When a person dies, life insurance can help a person leave money behind for their family. The policyholder with the life insurance company pays monthly for the premium. A person’s age, health, lifestyle, and how much cover is needed will all be taken into account for how much needs to be paid. People can opt for low cost life insurance or go for a pricier policy.
The most basic type of life insurance is term life insurance. This allows the policyholder to choose the amount to be insured for and the period covered. If the person dies within the period covered, the company will pay out the money. If the person dies outside the period covered, the company does not pay out the and the money you have not paid are not returned.
Another type of insurance is family income benefit insurance. It is a type of decreasing term policy which means that the company pays a monthly income into the beneficiaries until the expiry date of the policyholder.
Whole of life policy is another type of insurance, which means the person is covered for their entire life, and the money is paid out whenever the person dies, rather than in a certain period chosen. This policy is usually more expensive as it is guaranteed that the money will be paid out as death is inevitable.
A person can buy life insurance through many companies. It is common nowadays for supermarkets and high street stores to offer life insurance, not just banks and insurers.