Life Insurance Policy In Nigeria
Life insurance presents you with lots of insurance policy, insurance benefits, and various components guiding life insurance.
This is one of the insurance policies that will aid your family’s survival financially when you die. Going for this insurance policy is a wise decision when your family only depends on you. Below are the details about life insurance policy.
When you die, life insurance makes a financial provision directly to the exact named “beneficiaries” or “beneficiary” like your wife/husband, kids, and close relatives. In cases of business relationships, the person to benefit could be your partner in the business. The “Lump sum” or “death benefit” is the term given to the money given to your beneficiaries after your death. A payment is made when one purchases insurance and it’s called “Premium”. This payment called premium is based on some personal factors like medical history, age, gender, and the amount of the insurance policy purchased.
Most importantly, beneficiaries should try and know what everything about how this insurance policy is applied. The following are the uses:
- It can be used to pay off many debts, credit card debts, hospital debts, and other various debts after you died.
- In cases where you are the major financial provider in the family, the death benefits can also be used majorly to replace the loss of your income.
- It is also used to pay for someone’s funeral and any expenses related to death.
- Most insurance policies, like the universal or permanent policies, can also provide monetary benefits as long as the insurer is still alive.
- It has a “cash value” and that simply means that you can withdraw money to pay for more expenses.
Below are the different categories of Life insurance policies that are offered:
This is the most important, popular and cheapest in terms of life insurance. Term life insurance is a type of insurance policy that covers the insurer for a given period of time, usually from 1-20years. The term life insurance policy pays the death benefit when the person dies during the period of coverage. When premium are stopped paying, then the insurance policy becomes invalid.
The Whole life insurance or permanent life is known to cover the whole span of your life and do not have any expiring date. Some accumulate cash value, that can enable you to withdraw money from the policy at any point in time. The amount of premium paid can be determined by the age of the person at the period of the purchase. At a specific age, your cash value will be paid to the beneficiaries after death.