What is a insurance of life?

Life insurance is a financial instrument that can protect you and/or your family in the event of an accident or death. This insurance is formalized through a contract between the policyholder or insured and an insurance company.

In the event of the death of the insured, the beneficiaries of the insurance receive compensation for the agreed value of the insurance coverage in order to protect the economic stability of the family that may be affected by the death of this person.

It is very important to bear in mind that there are different types of life insurance and that the amount of compensation may vary depending on the type of insurance and the insured value contracted. However, the value of the compensation will always be agreed at the time of signing the contract.

Why is it important to have life insurance?

The main objective of life insurance is to guarantee that family members or people who are beneficiaries of the insurance are protected in the event of the death or disability of the insured, who is usually the head of the family.

Having life insurance is important because it guarantees that in the event of a misfortune, your loved ones are not financially vulnerable. On the contrary, by having life insurance they will have a backup to protect their assets and guarantee the quality of life in case one day you are missing.

Having this insurance can also prevent families from having to take extreme measures such as selling family properties, borrowing money with high interest rates, giving up studies to reduce expenses, among others.

Additionally, it is important to highlight that life insurance, according to current Colombian legislation, at the time of payment of the claim (indemnity), do not have withholdings at source, are free of inheritance lawsuits and are paid to the beneficiaries designated in the insurance contract (policy) when these have been clearly indicated and reported to the respective insurer.

How much is Individual Life insurance worth?

As we told you before, the value of insurance depends on the type of policy, the coverage you wish to contract and other factors that determine its value. We present some of these factors below:

A) Age of the insured

The cost of life insurance varies mainly by the age of the insured, since, as is to be expected, older ages have a higher risk of death and, therefore, a higher insurance value.

B) Gender

It is established that women have a higher chance of survival. Although scientists have not been able to explain why women live longer than men, this is a fact. Therefore, the value of insurance for women is less than that of men.

C) Insured value

The insured value is the amount that the insurance company undertakes to pay to the beneficiaries in the event of the death of the insured. This value is determined when quoting and hiring the insurance. We also suggest keeping in mind that the insured value should correspond to the sum of money that would be required so that, in a certain time, it reaches to cover the expenses of the family group, among others.

D) Main activity and hobbies of the insured

Insurers take into account the occupation and/or profession of the insured person. There are some professions and hobbies that have a higher risk of accident or factors such as politicians, public figures or professionals who have to travel frequently. In these cases the value of the insurance will be higher than that of people who work in an office.

E) State of health and medical history

A state of good health is considered when indicators such as hypertension, weight or cholesterol index are normal for the insured’s age. When there is a feature that is outside of what is stipulated as normal, it is likely that you will have to pay more for insurance.

F) Geographical area of ​​residence and/or work of the insured

Life insurance for a person who lives in areas with difficult access or with security problems, can also make the value of it more expensive than that of a person who lives in a capital city.

What is the maximum age to take out life insurance?

Actually there is no certain maximum age for all insurance. Each insurance company is free to determine its entry and renewal policies. In addition, according to the regulations in force in Colombia, insurers cannot revoke individual life insurance during its validity, or when they have an onerous beneficiary, except for the delay in the payment of the premium.

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