Life Assurance

Life assurance

• Covers against events that will certainly occur e.g. death.
• The principle of indemnity does not apply.
• Benefits are paid to spouses and children who are the beneficiaries of the policy.

Whole life policy.

• One assures his/he life for a certain sum of money,
• Which matures at the time of death.
• The sum assured is paid to the beneficiaries.
• The assured does not enjoy the benefits.
• The assured pays premiums for his entire working life of until death.
• The insurance company calculates the premium based on age and the sum to be assured.
• Endowment policy
• Taken for a specific period of time e.g. 15 years.
• Premiums are paid up at the end of the period or upon death of assured before the policy matures.
• If the assured dies before maturity date the sum assured is paid to his/her beneficiaries.
• If the assured lives up to the end of the period up until the policy matures then the sum assured is paid to him/her.
• This is regarded as a form of investment.
• The policy may or may not yield profits for the assured.

Retirement annuity assurance

• Provides regular payments to the assured:
• from a fixed future date usually retirement time until one dies.
• Premiums are paid up to the retirement date.

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