Gide of insurance policy what is insurance

The first step to achieving adequate protection is putting yourself in a position where you can make the informed decision yourself with the knowledge that you have gained and then go out and buy your own insurance or visit a professional that can do this for you on your behalf.
Insurance is a necessity that is applicable to each and every one of us in one way or another, however it is vital that we know exactly what it is that we need before we go shopping for it, just like making a meal at home, you have to know the ingredients that you need in order for it to turn out the way that you want it to. It is no different for insurance, you know what you need to be insured against, for instance you have a car and a mortgage, so you need to know which insurance policies are required to cover these. So you know you need insurance and this is a good place to start in your quest to get the right kind.
Whether you are looking for types of insurance such as health insurance, auto insurance or one of a whole range of other contracts available in the market today, we will surely have some information here that you can take away with you which you will find useful in making your decisions.

It really does pay to do some research before going ahead and buying insurance. By going directly to an insurer's website it can be a very confusing experience.
life insurance
When you think 'do I need life insurance?' it is not as simple as going to a broker or insurance company and buying a generic life insurance product. There are a range of life insurance policies available each with their own various benefits. It is important that you know exactly what benefits you are interested in before hand so that when it comes to picking a Life Term Insurance Policy or a Whole of Life policy to name a couple of the options, you are getting the insurance that is best suited to your individual needs.
Fundamentally, many companies will offer the same products across the market there can be many variations and additional features that can be purchased on each insurer's version and it is important to know exactly which contract suits your individual needs before you go shopping for it! This is not to mention niche insurance which may not necessarily be available from the bigger insurers and can be harder for a consumer to find somebody who will cover them, let alone provide any sort of definitive explanation as to whether the policy will suit their needs or not
As previously mentioned we are not trying to sell you insurance nor provide financial advice, just help you with some simplified, jargon free explanations as to how every day insurance contracts work.
Basic Life Assurance

Basic life insurance is a very simple type of insurance policy that will run for a pre-determined period of time and will pay out a pre-determined figure should the life assured/s on the policy die. It is relatively inexpensive and is much needed protection for you and your family. These types of life insurance policies can also be taken out solely as security on a mortgage or debt too. Basic life insurance is most commonly term life insurance and there are various types of life insurance policy under this heading.
For example Mr and Mrs Smith take out a 20 year life assurance policy which will pay out $50,000 on the death of either of the lives assured to the survivor. The policy will have an agreed commencement date of 1 July 2010 and the policy will expire on 31 July 2030. In this scenario the policy is against the life of Mr and Mrs Smith, they are both the policy owners/holders and the lives assured.
A monthly, quarterly or annual premium is paid throughout the term in order to keep the policy in force and valid.
It may be that the policy length or term as it is better known is only available in increments of 5 years with some insurers and the term limit is quite often 30 years.

How long you take the policy out for is completely up to you, for instance a younger couple with a new mortgage and who are yet to have children may take out a longer policy so that the mortgage is covered and should they later decide to have children they are covered for many years of the child's life while they are depended upon.

The amount of cover taken out is also up to you but the insurer can ask for this to be justified. Things needed to be taken into consideration are for example the outstanding value of your mortgage or the living costs of your family.

Variations could be that Mr and Mrs Smith both take out a life assurance policy but the life assured is only Mr Smith, or they take out two with one of them being a life assured on each. These policies will only pay out on the death of the life assured on that policy to the surviving policy holder. Mr Smith could also take a policy out and be the policy holder with Mrs Smith as the life assured and visa versa. The policy holder is always the owner of the policy and the benefactor, the lives assured are simply the people who's live the insurance is taken out against. It can however be possible for the policy to pay out to named beneficiaries, these must be proven to be dependent upon the lives assured.