Introduction to Life Insurance Sample Clauses

Introduction to Life Insurance. Life insurance is a contract between the policy holder and the insurer, where the insurer promises to pay a designated beneficiary a sum of money (the "benefits") upon the death of the assured person. Depending on the contract, other events such as terminal illness or critical illness may also trigger payment. In return, the policy holder agrees to pay a stipulated amount (the "premium") at regular intervals or in lump sums. In some countries, death expenses such as funerals are included in the premium. The value for the policy owner is the 'peace of mind' in knowing that the death of the assured person will not result in financial hardship. Life policies are legal contracts and the terms of the contract describe the limitations of the assured events. Specific exclusions are often written into the contract to limit the liability of the assured; common examples are claims relating to suicide, fraud, war, riot and civil commotion. Life-based contracts tend to fall into two major categories: Protection policies – designed to provide a benefit in the event of specified event, typically a lump sum payment. A common form of this design is term insurance. In the Nepalese scenario there is expatiate plan for workers who goes to the overseas. Investment policies – where the main objective is to facilitate the growth of capital by regular or single premiums. Common forms (in the Nepal) are whole life, universal life and variable life policies. Overview of life insurance companies can be presented as below.