Life Insurance and Its Importance

What is Life Insurance? 

Let’s start with what a life insurance is, it is basically an agreement between two parties an assurer and a policyholder it commonly constitutes the arrangement in which the policy holder pays a fixed amount to the insurer in episodes or a sum amount commonly referred to as ‘premium’ and upon the death of the policy holder, the insurer pays back a certain amount of money in bulk form. Various types of insurance are available and certain situations for example an accidental death or a chronic terminal illness can be a part of the arrangement and activate the payment.

Types of Insurance 

  • Complete life insurance is the simplest form which constitutes of both factors of shelter and investment. With investment factor amount can be saved up and assembled and the person can draw out as they desire. This policy covers all life, death interests and families can retrieve the premium value when the policyholder has expired. However, one important detail is that which this policy the premium amounts are not flexible at all and a set amount will be received as the premium.
  • Marriage and education scheme is for certain events as the name implies these schemes are provided for the assistance during the events relevant to a child’s education or their marriage. The nature of this scheme is of present occupancy, if the holder dies during the time until which the policy is intact; family receives premium payments in the name of the policy holder. It also provides chunks of premium to the family members periodically an annuity to those who are left behind the policy holder.
  • Endowment policy is one of the most popular ones it includes the settlement in which a lump sum is paid to the holder or the family of a person on the death or after the maturity of the policy. Usually maturity can be within the range of ten to twenty years and comes up with an age limit. The benefactor can choose for themselves the amount of money they desire to be saved up and when their policy matures.
  • Single-premium scheme involves paying a single large amount at a time instead of the small installments as a premium. This policy provides a benefit at death which is ensured until the death of the policy holder. Many factors affect the amount of death benefit it includes the health factors along with age of the holder and also the value which has been funded in the name of the holder in the first place.

Why is Insurance Policy Important?

When making a plan, the first thing that comes into mind is the unpredictability of this life that we live. This is exactly why we need to feel safe and be assured that if something happens out of the blue (sudden accidental death, financial loss etc.) or any other set back in life we will be financially secure and an insurance policy does exactly that. It allows you to be mentally relaxed and be less concerned about the sudden problems or financial losses in life and just for yourself but you also keep your family safer. Many companies provide insurances of education, houses, health and other possessions. There are as many options as one may like and you can definitely find something which works for them. Having insurance makes life easier and more predictable in certain aspects. Therefore one should definitely get insurance.

Several working companies provide a variety of policies in Pakistan. The list of most secure and trustworthy companies includes Jubilee, EFU, United, Agro and Alpha insurance company. These provide a range of policies with multiple benefits and security while taking into mind our cultural and social factors. You can visit the offices or get started by exploring online and pave your path towards a more financially stable life.