Life insurance is one of those things that we try not to think, because no one likes to think about their own death, or making plans for her. The truth is that it makes the provision of adequate family and members of their families while still alive, it is best that we can do to protect them from financial problems or difficulties in the future.
Life insurance comes in many different forms and can be a bit confusing with only different in terms of "insurance" and "software". For simplicity, the following guide should help you understand the differences.
When talking about the difference between insurance and assurance that there is no difference, although the most common term is life insurance. A subtle difference, however, that the insurance accepted, to cover future events that may occur, for example, auto insurance policy, where, as a life insurance policy provides cover for the event, which, of course, are such as death.
In case of death of both types of policies pay a lump sum to the specified recipient, and that critical illness cover policies will pay the same amount to the death if the diagnosis of terminal illness or critical illness covered by the policy.
What types of life insurance are there?
There is a wide range of insurance policies available in the market, but when looking to protect the mortgage following are the basic rules must be considered.
Mortgage Life Insurance
Policies aimed at paying off the mortgage in the event of death or critical illness of early diagnosis can be divided into two categories. The first is a "Mortgage Life Insurance," otherwise known as Decreasing Term Assurance, and other insurance Level Term life otherwise known as politics Assurance.
Reducing the period of insurance
This type of policy is set to pay a lump sum sufficient to repay the debt on the mortgage in the event of death or earlier critical illness. This type of policy is used alongside the standard mortgage payments, where the policy allows the built-in reducing the mortgage balance. There is no investment element of any type with this policy, so he just pays a lump sum agreed to accept claims. If you survive the policy term, there is no payment.
Level term insurance
The only difference is the level term policy to ensure is that the sum insured does not decrease the duration of the insurance policy. This type of policy can be fit to start, along with interest only mortgage where the mortgage balance remains the same, because the capital is not repaid in a month. As with mortgage insurance policy, the insurance level term policy requires payment of monthly premiums. In the event of a claim the insured amount is paid to the beneficiary a lump sum.
Low Cost Life Insurance with Savings
Although this is an insurance policy, the policy fund is a savings plan with a term policy of decreasing, which works in conjunction with a savings plan. In terms of savings are in the hope that it will grow to an amount sufficient to repay the mortgage at maturity. The monthly premium is calculated accordingly. In the same way as the policy of reducing the term guarantee to repay the mortgage in the event of death to pay off the mortgage, the same principle applies to a policy of donations. As savings increase in value of the sum insured is reduced sure, with a combined amount always sufficient to repay the mortgage in the event of a claim.
What other options?
The critical illness benefit
With all the policies you will have the ability to add additional benefits. The main of them is a critical benefit a disease that encompasses a variety of different critical illnesses such as heart attack, stroke and cancer. Different providers have different definitions and exclusions, limitations or restrictions will be applied to most policies. Typical coverage is limited for some of the less developed cancer, which are easier to treat.
Below is a basic list of diseases covered by the main political disease - Alzheimer's disease, aortic graft surgery, aplastic anemia, bacterial meningitis, a benign brain tumor, blindness, cancer, cardiomyopathy, chronic pulmonary disease, coma, coronary artery bypass grafting using, Creutzfeldt-Jakob disease , deafness, dementia, stroke, heart valve replacement or repair HIV or AIDS from the attack, blood transfusion, occupational duties or accident, Keyhole heart surgery, kidney failure, loss of independent existence, loss of limbs, loss of speech, Major Organ Transplant , motor neuron disease, multiple sclerosis, paralysis / paraplegia, Parkinson's disease, stroke, third-degree burns, Total and permanent disability.
Waiver of premiums
If you are unable to work due to ill health, you can insure your monthly premium. So in the case of claims made premiums will continue to be paid until the end of the policy of a certain age, or if you are able to return to work.
How much is the right mortgage life insurance cost?
It depends on the individual life insurance companies underwriting criteria. Each vendor uses different criteria for their quotes, and some policy is cheaper than others. The main factors determining the value of life insurance are:
Age, sex, height and weight, medical history, family history of health, marital status and number of children you have, your profession, whether you are a smoker or nonsmoker, any dangerous sports you participate in, such as sky diving, consumption alcohol, and the purpose of insurance.
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