Life insurance concept:
Life insurance means insurance that covers material losses arising from the verification of the death phenomenon or reaching a certain age (life) or both.
Consequently, life insurance is one of the life risk management policies for the individual to face the financial loss arising from the realization of the death phenomenon for the dependents of the individual or in relation to the financial loss resulting from reaching a certain age and the inability to earn. It is a way to address shortages of income or interruptions in income due to death, reaching a certain age, or both.
Personal risks to the individual:
In his life, the individual faces many dangers associated with his person, which, if achieved, lead to limiting his ability to work and obtain income or eliminate his productive ability completely. Personal hazards can generally be divided into the following five types:
1. The risk of premature death.
2. The risk of retirement
3. The risk of permanent total disability.
4. The risk of illness and temporary disability.
5. The risk of unemployment.
The dangers of the first three groups lead to a total and permanent loss of income, while the fourth group dangers lead to a temporary or permanent reduction in income, or it may lead to a temporary loss of income only. As for the risk of unemployment, it results in total income cut off for a temporary period until the individual has access On another job.
It is noted that the losses that occur as a result of the realization of personal dangers are not only material losses, but also consist of material and moral losses at the same time. This material loss, because the loss of the breadwinner represents a moral loss for his family that cannot be evaluated with cash, and on this basis it leaves the student with life insurance the freedom to determine the amount of the insurance, which is often determined by looking at his financial ability and his ability to pay the premium.