State the process for the formation of life insurance contact
Answers
Answer:
Insurance may be defined as a social device that reduces or eliminates the risk of life and property by providing financial compensation for any uncertain misfortune. It is basically a contract between two parties, i.e the insurer and the insured, wherein one party promises to save the other, for compensation called the premium, from the loss caused to him due to some specified contingency. In legal aspects, it is a contract whereby one party agrees to indemnify the other against the loss caused to him due to the occurring of one particular event. An insurer is a company selling the insurance[i], an insured or a policy holder[ii] is a person buying the insurance, and the premium is the amount that is to be charged for insurance coverage.
Answer:
Life Insurance
Life insurance is a scheme that allows man to schedule income continuity if death, injury, or old age threatens his ability to earn a living. Life insurance in its general sense is used to cover all forms of insurance designed to protect against income loss resulting from incapacity to work, whether this is caused by suicide, accidental injury, disability or old age. Life insurance in its specific meaning means compensation only in the event of death.
To move through life without deprivation, every person has to have a constant flow of income from cradle to grave.
Life insurance deals with the ideals of human life. Far too many people tend to think only in terms of measurable economic values: real estate, machinery, inventories. We don’t consider the immense value of human life’s earning power. The life insurance premium is calculated according to the monetary value of the life.
Man represents great value within himself that creates all usefulness in tangible property. Everything we have in this world comes from man. But life-value is the fundamental value. Human life has so much of a financial value. Ideas and resources in our lives make money and both come from man himself. Man is endowed with highly intellectual capacity and makes unceasing and untiring efforts to improve and advance his life, which guarantees him the highest happiness, comfort and benefits.
Although life has a very definite meaning, it is important for a man’s long-term financial success that either he survives long enough to earn more, or that life insurance will cover it. Earnings reflect the power, behaviors and character of the past to predict the future.
However, the value of that future cannot be reduced, although it can be offset by using insurance in the case of premature death or lifelong incapacity. Life insurance is the only way to maximize the value of life first and then compensate for the replacement interest throughout one’s lifetime.
In most cases the family depends on the current earnings of the head of the family, who, in other words, is the family’s bread-winner for their survival. The family members have the right to seek appropriate maintenance from him and it is his responsibility to provide the best possible maintenance for them. If that source of income ends with death, it would be important for the family to make economic and social changes, which could lead to serious physical and psychological harm.