What is Life Insurance?
Table of Contents
Life Insurance is an agreement that guarantees payment of a stated amount of monetary benefits at the end of a specified term or on the death of the life insured. In realistic terms, life insurance provides you and your family the financial security and certainty to deal with the aftermath of any unseen unfortunate events.
Why do I need life Insurance?
There are several reasons to purchase life insurance. The most common reason to buy life insurance is to provide financial protection to your family in case of any unforeseen events. Besides providing for financial security in the case of one’s untimely death, it can be used to accumulate a kitty for your old age, systematically build assets, for funding your child’s education and also for saving on taxes.
When should I buy
Life insurance is very important part of financial planning. As soon as you start your career, you should consider buying a policy. The premium of the policy increases with the age, therefore the older you get the more it will cost.
How much should I buy?
Life insurance needs depends on several factors such as present age, number of dependents, individual liabilities, loans and debts, annual income, standard of living, affordability etc.
Experts advice that the minimum insurance amount should be at-least 12.5 times of your annual income. Considering the 8% per annum average return on investment, your dependents will be able to earn the same amount of annual income by investing the claim amount in a bank.
Also read this: LIC claim settlement Ratio
Which plan should I choose?
Choosing life insurance plan depends on the individual needs and hence it varies from person to person. One should think about the purpose of buying life insurance before picking an insurance plan. It is suggested to discuss your future financial needs with your insurance advisor in order to choose the correct insurance plan.
What should be the term (duration) of the policy?
As long as you are the breadwinner in your family, you should be insured. In India, average age of retirement is 60 years and hence, ideal life insurance term should be 60 minus your present age.
How much will the life insurance cost?
The cost or premium of life insurance depends on the type of insurance, your present age, term of life insurance, amount of sum assured, your occupation etc. Your age is very important factor, as said earlier. The older you get, the more it will cost.
LIC IS THE BEST.
- It was founded in 1956 with the merger of 245 companies and provident societies (154 companies,16 foreign companies & 75 provident companies)
- It’s a state-owned company where Government of India has 100% stake
- It is headquartered in Mumbai, financial and commercial capital of India
- LIC has 8 Zonal Offices and 118 Divisional offices located in different parts of India, around 3500 servicing offices including 2048 branches, 54 Customer Zones, 25 Metro Area Service Hubs and a number of Satellite Offices located in different cities and towns of India
- Has a network of 13,37,064 individual agents, 242 Corporate Agents, 79 Referral Agents, 98 Brokers and 42 Banks (as on 31.3.2011)
- Has assets estimated of INR 1560481.84 crore (US$240 billion)
Why you should choose only LIC
- Worlds largest insurance company in terms of customer base with over 250 million customers.
- Largest insurance group and investment company in India. Has more than 70% of the market share.
- All LIC policies come with a sovereign guarantee from Government of India. Only LIC can give this privilege to its customers.
- Highest claim settlement ratio (97.73%). More than any other private insurance company.
- LIC has highest market share (74.29%) in India.
Awards and Recognition in 2012 – 2013
- NDTV PROFIT BUSINESS LEADERSHIP AWARD 2012
- CONSUMER Superbrand AWARD
- OutlookMoney AWARD FOR BEST LIFE INSURER 2012
- Brand Equity MOST TRUSTED SERVICE BRAND AWARD 2012
- EXCELLENCE IN FINANCIAL SERVICES AWARD BY Dainik Bhaskar 2012-2013
- DAINIK PURVODAY – NORTH EAST CONSUMER AWARDS 2012
- ABCI AWARD FOR BEST Online CAMPAIGN
- CNBC TV AWARD FOR OUTSTANDING FINANCIAL PROFESSIONAL 2012
- Jamnalal Bajaj Award for fair Business Practises in Service Industry
- CNBC TV 18 Award Overall Leading Insurance Company 2012
- ABCI AWARD FOR WALL CALENDAR 2012-SILVER
- World Brand Congress- Global Award for Brand Excellence
- Most Popular Youth Brand BFSI sector
- Money Today FPCIL award Best Life Insurance Provider
- Power Brands Award 2012
- Instt of Public Enterprise BFSI Award – Best Employer Brand
- 7th Indy’s Award for Best Corporate Film 2012 (Silver)
- Indy’s Award for Best House Magazine 2012 (Gold)
- My FM Stars of the Industry Award for Excellence in Life Insurance (Gold)
- My FM Stars of the Industry for Brand Leadership Award in 2012 (Gold)
- 7th Indy’s Award for Best in Media Category
- Indy’s Award for Most Creative Ad (TV) in BFSI (Silver)