COMMERCE 4FP3 Chapter Notes - Chapter 9: Disability Insurance, Life Insurance, Term Life Insurance
16 Mar 2019
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Life insurance is obtained by purchasing a policy with the insurance company promising to pay a lump sum to the person specified at the time of the insured"s death, or sometimes while they are still alive. In some policies, money is paid to the policy holder (the insured) if he/she is still alive at a future date: company makes promise to pay in exchange for the payment of a premium. To protect someone who depends on you from financial loss related to your death. Life insurance is one of the few ways to provide liquidity at the time of death. The principle of life insurance: mortality tables provide odds on your dying, based on your age and sex. Your premium is based on your life expectancy and the projections for the payouts for persons who die: adjustable for factors that increase/decrease an individual"s risk and various admin fees for the company.
