Life is extremely uncertain and although we would all like to know where we will be ten years from now, there is no definite way to make this prediction. Thus, we must put our best foot forward and hope that everything will work out for the best.
This being said, there are a number of preventive measures that can be taken in order to secure ourselves and our finances. One of the best ways of doing this is with the help of an insurance policy. This acts like a financial safety net that can be very beneficial in the long run.
The most basic form is life insurance, which provides a monitory compensation in case of the worst. In this case, there are two options to choose from, term and whole life insurance. The former is valid for a specific period of time, say ten or twenty years according to the plan chosen. If something was to happen to the insured during this period, the nominee will receive the sum assured.
The other option is whole life insurance, where premium is paid on regular bases until a certain age. It is then given back to the insured either in lump-sum or in installments. If something was to happen to the insured during this period, the sum assured will be paid to the nominee. Thus, this works as a form of saving as well is a form of financial security.
This answers the basic question, what is life insurance. However, this is just the basics. There are more than a few options, when it comes to the types of schemes that are available to pick from. For example, there are schemes that offer coverage to the entire family or others where the premium increases, so as to make an allowance for inflation.
Here are some of the books you can go through to get more information on basics of life insurance.
- Questions and Answers on Life Insurance: The Life Insurance Toolbook – by Tony Steuer
- New Life Insurance Investment Advisor – by Ben G. Baldwin
- Tools and Techniques of Life Insurance Planning – by Stephan R. Leimberg
- Insurance for Dummies – by Jack Hungelmann
- Life Insurance – by Kenneth Black
- Short and Simple Guide to Life Insurance – by Alan Lavine
This is a necessary expense and it helps maintain financial stability, in spite of be faced with a grim situation. If something was to happen to the earning member of the family it will be very difficult to bounce back into the regular routine both financially and emotionally. The amount of the policy will help in this process and will make the transition period a little easier.
Thus, it is always best to prepare for the worst and hope for the best!