Lakulish Consultancy

Importance of Life Insurance

2012-04-04T04:13:00.003-07:00

Importance of Life Insurance

One of my good friend had a small argument with me, that she would not invest inTerm Plan of Insurance because she will not get any “returns” out of it. I believe investing in a term plan looked a very unprofitable thing to her as she never gets back the money she paid as “premiums” , if she survives.

Endowment plans looked nice to her, because they provide money if you are dead and even if you survive. You get back money as the prize for not dying !!!.

With respect to Term insurance , she understood the fact that her family will get the money from insurance company in case of her death, but she was concentrating on the fact that she would not get back anything if she survives. What is the return in that case? Nothing !!! , and looked like some one isfooling you with a product called “Term Insurance” , where you are “investing” premiums to get nothing at the end.

Let me now tell why this happens and some give you some insight on this matter.

I have already talked earlier in my last post “Life Insurance and how to go about it” , about Term Insurance . Let me now take more deep dive into it and talk about the reasoning part.

I will first talk about fundamentals of Insurance and then talk about Endowment Policies and why are they popular, and what people don’t realise about them. and how Term insurance is the right thing for most of the people.

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2012-04-04T03:54:00.003-07:00

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Why Insurance Is Important ?

2012-03-31T22:32:00.001-07:00

Why Insurance Is Important ?

If you were to die could your family or dependants, pay for your funeral, organize the financial affairs, service pre-existing debt and continue their current standard of living without you? This is why life insurance is important.

If you were to be seriously injured could you pay for your hospital costs, ongoing treatment, time off work, pay the living costs for you and your family until you are fully recovered, if you are fully recovered?. This is why Total Permanent Disability insurance can be important.

If you are injured and are unable to continue working are you able to service your debtors and maintain any standard of living? This is why you need income protection insurance.

If you were to be in a car accident with two other cars and it was determined that the accident was your fault, could you go to a car showroom and buy yourself a new car, pay for repair or replacement of the other two cars and pay for the medical bills of the other drivers and their passengers? This is why motor insurance can be important.

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2012-03-26T12:26:00.002-07:00

2012-03-26T00:26:00.001-07:00

IMPORTANCE OF INSURANCE

The process of insurance has been evolved to safeguard the interests of people from uncertainty by providing certainty of payment at a given contingency. The insurance principle comes to be more and more used and useful in modern affairs. Not only does it serve the ends of individuals, or of special groups of individuals, it tends to pervade and to transform our modern social order, too. The role and importance of insurance, here, has been discussed in three phases: 1) uses to individual 2) uses to a special group of individuals ie business or industry and 3) uses to the society.

USES TO AN INDIVIDUAL
1. Insurance provides security and safety
The insurance provides safety and security against the loss on a particular event. In case of life insurance payment is made when death occurs or the term of insurance is expired. The loss to the family at a premature death and payment in old age are adequately provided by insurance. In other words, security against premature death and old age sufferings are provided by life insurance. Similarly, the property of insured is secured against loss on a fire in fire insurance. In other insurance, too, this security is provided against the loss at fire, against the loss at damage, destruction or disappearance of property, goods, furniture and machines, etc.

2. Insurance affords peace of mind
The security wish is the prime motivating factor. This is the wish which tends to stimulate to more work, if this wish is unsatisfied, it will create a tension which manifests itself to the individual in the form of an unpleasant reaction causing reduction in work. The security banishes fear and uncertainty, fire, windstorm, automobile accident, damage and death are almost beyond the control of human agency and in occurrence of any of these events may frustrate or weaken the human mind. By means of insurance,however, much of the uncertainty that centres about the wish for security and its attainment may be eliminated.

3. Insurance protects mortgaged property
At the death of the owner of the mortgaged property, the property is taken over by the lender of money and the family will be deprived of the uses of the property. On the otherhand, the mortgage wishes to get the property insured because at the damange or destruction of the property he will lose his right to get the loan repayed. The insurance will provide adequate amount to the dependents at the early death of the property-owner to pay off the unpaid loans. Similarly, the mortgagee gets adequate amount at the destruction of the property.

4. Insurance eliminates dependency
At the death of the husband or father, the destruction of family need no elaboration. Similarly, at destruction of property and goods, the family would suffer a lot . It brings reduced standards of living and the suffering may go to any extent of begging from the relatives, neighbours or friends. The economic independence of the family is reduced or , sometimes, lost totally. What can be more pitiable condition than this that the wife and children are looking others more benevolent than the husband and father, in absense of protection against such dependency. The insurance is here to assist them and provides adequate amount at the time of sufferings.

5. Life insurance encourages saving
The elements of protection and investment are present only in case of life insurance. In property insurance, only protection element exists. In most of the life policies elements of saving predominates. These policies combine the programs of insurance and savings. The saving with insurance has certain extra advantages-i) systematic saving is possible because regular premiums are required to be compulsorily paid. The saving with a bank is voluntary and one can easily omit a month or two and then abandon the program entirely. ii) in insurance the deposited premium cannot be withdrawn easily before the expiry of the term of the policy. As contrast to this, the saving which can be withdrawn at any moment will finish within no time. iii) the insurance will pay the policy-money irrespective of the premium deposited while in case of bank-deposit, only the deposited amount along with the interest is paid. The insurance, thus, provides the wished amount of insurance and the bank provides only the deposited amount. iv) the compulsion or force to premium in insurance is so high that if the policy- holder fails to pay premiums within the days of grace, he subjects his policy to lapsation and may get back only a very nominal portion of the total premiums paid on the policy. For the preservation of the policy, he has to try his level best to pay the premium. After a certain period, it would be a part of necessary expenditure of the insured. In absense of such forceful compulsion elsewhere life insurance is the best media of saving.

6. life insurance provides profitable investment
Individuals unwilling or unable to handle their own funds have been pleased to find an outlet for their investment in life insurance policies. Endowment policies, multipurpose policies, deferred annuities are certain better form of investment. The elements of investment ie regular saving, capital formation, and return of the capital alongwith certain additional return are perfectly observed in life insurance. In india the insurance policies carry a special exemption from income-tax, wealth tax, gift tax and estate duty. An individual from his own capacity cannot invest regularly with enough of security and profitability. The life insurance fulfills all these requiremens with a lower cost. The beneficiary of the policy-holder can get a regular income from the life-insurer, if the insured amount is left with him.

7. life insurance fulfills the needs of a person
The needs of a person are divided into a) family needs,b) old-age needs,c) re-adjustment needs,d) special needs,e) the clean-up needs.

INSURANCE, (TAXATION IN INDIA)

2012-03-24T11:20:00.001-07:00

INSURANCE, (TAXATION IN INDIA)Premiums paid by the policy owner are deductible from the taxable income of the policy owner under section 80 (C) up to a maximum limit of Rs.1,00,000. Any proceeds from an Insurance Plan in form of maturity proceeds, claims, partial withdrawal is exempt from taxation under section 10 (10) D of Income Tax law of India.

So Get Insurance today only from;

YOGRAJSINH P JETHWA

+91 9428898501

+91 9979427773

www.lic24x7.blogspot.in

2012-03-24T11:13:00.001-07:00

Life insurance is a contract between an insurance policy holder and an insurer, where the insurer promises to pay a designated beneficiary a sum of money (the "benefits") upon the death of the insured person. Depending on the contract, other events such as terminal illness or critical illness may also trigger payment. The policy holder typically pays a premium, either regularly or as a lump sum. Other expenses (such as funeral expenses) are also sometimes included in the premium; however, in Australia the predominant form simply specifies a lump sum to be paid on the policy holder's death.

The advantage for the policy owner is "peace of mind", in knowing that the death of the insured person will not result in financial hardship for loved ones.

Life policies are legal contracts and the terms of the contract describe the limitations of the insured events. Specific exclusions are often written into the contract to limit the liability of the insurer; common examples are claims relating to suicide, fraud, war, riot and civil commotion.

So Get Insurance today only from;

YOGRAJSINH P JETHWA

+91 9428898501

+91 9979427773

www.lic24x7.blogspot.in

Invest in Insurance and SAVE YOUR TAX.

2012-03-21T07:20:00.004-07:00

Call LIC Insurance Adviser: Yograjsinh P Jethwa,
9428898501, 9979427773 — at Mundra Kutch.

Key Benefits of Life Insurance:-

2012-03-20T11:51:00.000-07:00

Key Benefits of Life Insurance:-

Visit: www.lic24x7.blogspot.in

call : YP Jethwa,

+91 9428898501

+91 9979427772

Asset Protection:-
The core benefit of life insurance is that the financial interests of one’s family remain protected from circumstances such as loss of income due to critical illness or death of the policyholder. Simultaneously, insurance products also have a strong inbuilt wealth creation proposition. The customer therefore benefits on two counts and life insurance occupies a unique space in the landscape of investment options available to a customer.

Goal based savings:-
Each of us has some goals in life for which we need to save. For a young, newly married couple, it could be buying a house. Once, they decide to start a family, the goal changes to planning for the education or marriage of their children. As one grows older, planning for one's retirement will begin to take precedence.

Clearly, as your life stage and therefore your financial goals change, the instrument in which you invest should offer corresponding benefits pertinent to the new life stage.

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2012-03-20T03:55:00.001-07:00

Jeevan Anand. Click on it

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Lakulish Consultancy

2012-03-15T12:34:00.000-07:00

(LIC24x7.Com) Lakulish Consultancy,

A Prominent Insurance Adviser which providing Insurance Services. One stop Solution of Insurance Services.

Contact: Yograjsinh P Jethwa

+91 9428898501, +91 9979427773

What Is Life Insurance?

2012-03-14T06:28:00.006-07:00

Life insurance is a contract that pledges payment of an amount to the person assured (or his nominee) on the happening of the event insured against.

The contract is valid for payment of the insured amount during:

The date of maturity, or
Specified dates at periodic intervals, or
Unfortunate death, if it occurs earlier.

Among other things, the contract also provides for the payment of premium periodically to the Corporation by the policyholder. Life insurance is universally acknowledged to be an institution, which eliminates 'risk', substituting certainty for uncertainty and comes to the timely aid of the family in the unfortunate event of death of the breadwinner.
By and large, life insurance is civilisation's partial solution to the problems caused by death. Life insurance, in short, is concerned with two hazards that stand across the life-path of every person:

That of dying prematurely leaving a dependent family to fend for itself.
That of living till old age without visible means of support.