Life insurance concept:
Life insurance means insurance that covers material losses arising from the realization of the phenomenon of death or reaching a certain age (life) or both (death and life).
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.
Life insurance documents
The life insurance policy is a contract whereby the insurance company commits to pay the insurance amount to the insured, his heirs, or the beneficiary or beneficiaries specified in the policy, in the event of the death of the insured over his life, or if the insured has reached his life to a specific age in the policy, in exchange for The insured has to pay a single installment that is paid once upon contract or annual installments.
Life insurance policies can be divided according to the benefits that life insurance beneficiaries get into three main sections:
The first section: insurance policies whose sums are paid to the heirs and beneficiaries in the event of the death of the insured, such as temporary insurance documents, life insurance policies.
The second section: Insurance policies whose amounts are paid in case the insured survives, such as pure endowment insurance policies and life payment contracts (pensions).
The third section: insurance policies whose amounts are paid in the event of death or life and are mixed insurance policies that guarantee the payment of the insurance amount to the beneficiaries if the insured dies during the insurance contract period or the insured person gets the insurance amount if he is still alive at the end of the insurance period .
We will discuss these types in some detail below:
The first section: Insurance policies that are paid in the event of death:
This section includes all documents that guarantee payment of a certain amount to beneficiaries in the event of the death of the insured. The documents of this group are divided into two main types:
First – temporary life insurance:
Pursuant to this policy, the insurer (the insurance company) undertakes to pay the amount of insurance specified in the policy to the heirs of the insured or the beneficiary or beneficiaries specified in the policy in the event of the death of the insured in his life during the insurance period that begins immediately after the contract, and in the event that the insured remains alive until The end of the insurance period, the company is not obligated to pay any amounts to the insured, provided that the insured is obliged to pay the due installments on their due dates.
Temporary insurance is considered one of the most important types of life insurance contracts, and many individuals prefer to buy temporary insurance because of its low cost, as it is considered the cheapest type of life insurance in terms of the amount of the premium, and its importance has increased, especially after expanding in the purchase by installments, where the life insurance policy is used Temporary payment of installments in the event of the death of the buyer.