What is Life Insurance?
An amount which the nominee or the family will receive after the demise of the insured. Life insurance is simply a tool which will provide money to your near and dear ones after you, which will help them in different ways like paying EMIs, payment of school bills, payment of other household expenses etc. For that you need to pay risk charges to the life insurance company.
Need of Life Insurance
Life Insurance is required to provide financial security to the family. So that the family should be financially independent after the demise of the bread winner of the family.
Things to consider before buying a Life Insurance Policy
- Credibility of the company, services offered and claim track record.
- Credibility of your investment consultant.
- Does the policy offered to you suit all your needs?
- Go through the terms and conditions of the policy (either through company’s own website or company’s broacher).
- Past track record of the product.
All the above one should check very carefully as it might be the case that your family have to claim the amount from the company.
Providing information to the company while
filing up the Application Form
One should provide all the correct information to the insurance company like your Personal details, Medical details, Family history, Existing insurance, Nominee details etc. as all these details helps the insurance company to rate the risk for you on the basis of which company issues the policy.
Employer Employee Scheme
Employers have an insurable interest in the lives of his employees. In view of this employer can take a life insurance cover for employees where the premiums are paid by the employer.
An employer employee relationship would be established where the employee earns a salary from the employer. The insurance policies can be taken for all employees or for a class of employees. The employer may or may not be the Proposer under the policy.
Need of Employer - Employee Insurance
- As a reward for good service to a select band of employees.
- As an encouragement for continuation in the service
- As a welfare measure and provision for his old age/ dependents.
Group Term life Insurance
Group term life is normally a one-year renewable term insurance, which may be extended to cover the insured’s spouse and eligible children. The widespread use of group term life is thanks to its ability to provide employers with low-cost death benefits for the protection of the employees and their dependents.
Group Gratuity Schemes
Most employers have a statutory obligation to pay a gratuity to its employees on termination of employment. This gratuity is in the form of a one-off payment made on termination of employment. It depends on salary and number of years of service, so will therefore increase with time. The plan helps the company by building a fund systematically, which will be used to meet your future gratuity liability & providing the opportunity to maximize investment returns and thus provide the benefit in a cost-effective manner.