Types Of Insurance

Traditional insurance
Understanding Life Insurance Policy (Life Insurance Policy) according to the definition of LOMA (Life Office Management Association) is:
"Policy Life Insurance (Life Insurance Policy) is the policy in the policy where the insurance company promises to pay benefits upon the death of the insured / insured."
Traditional insurance also has various types, each of which will be explained as follows:
1. Term life insurance (term)
Term insurance only provide protection for a certain period only. Protection can be as short as a plane from Jakarta to Semarang for less than two hours or as long as 20 years. Typically, there is a time limit of insurance protection. In addition, if there is no risk, the insurance money is not returned or forfeited.
This type of insurance has a premium least expensive among the other insurers. The coverage can be a big money, billions with a premium that is not too draining the contents of the bag. Type of term life insurance has no cash value. If at the expiry of the insurance contract the insured is still hale and hearty, the contract expires and no money was given to the insured.

2. Insurance whole life (lifelong)
It contains the value of the insurance savings. The period of protection was longer, up to 99 years. This insurance is called as a refinement term life insurance which has no cash value. But the value of the premium to be paid customers are also more expensive than term life insurance.
On the whole life insurance, when the contract expires and the insured is still hale and hearty, no cash value given to customers. The cash value of whole life policy can be used as collateral for loans and no bonus dividends of the company for the whole life policy holders. Moreover, if it can not pay the premium, the policyholder can take money from the cash value of this. This feature does not exist on the type of term life insurance.

3. Insurance endowment (endowment)
The third type of traditional insurance are endowment. This type is like term insurance as well as savings. Diverse forms of endowment insurance. Besides having a cash value, there are also funds expended in futures before the insurance contract expires. These funds come out periodically eg 3 years or 5 years.
For example, such as the issuing insurance fund education when the child is 5 years old for kindergarten entrance fee, 7 years for the cost of enrollment in primary school and beyond. Unfortunately, endowment insurance premiums are much more expensive than term insurance premiums as well as whole life.

Non-traditional insuranceNon-traditional types of insurance is only one link unit. In addition to functioning as a protection, it also serves as an investment. The premiums paid partly used to pay for protection and partly placed in mutual funds in the form of unit-linked.
Policyholders will be asked to choose where to put their investments, whether in equity funds, balanced funds, fixed income funds, or money market.
For the type of unit-linked insurance is quite complicated and difficult to understand. So that prospective customers have to really pay attention and further research.

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Written by Dx at the date of Tuesday, 5 January 2016