Written by
Shoaib shah Al Asadi
The decision to buy life insurance is the first step in a often confusing process. In addition to calculating how much security is allowed, you will also need to choose between a lifetime policy and a guaranteed release contract.
Both offer important financial protection for those you leave behind, but do it in very different ways. Making the wrong choice can cost thousands of dollars over time.
We will compare the short-term health policies with the guaranteed policies below. Most buyers will be better off with the previous option. Others, depending on their personal circumstances, may need the following. We will explain why in the next conversation, and help you choose between them along the way.
Simplifying
Guaranteed problem policies, sometimes called simplified lifetime contracts, are extremely complex. Your premiums are based on your life span, amount of coverage, gender, and other variables. Another factor that makes policy difficult is the investment component (discussed below).
A life insurance contract is easy to build. You choose the duration of the policy, the amount of coverage, and name your beneficiaries. There is no investment component. And there is no need to worry about tax treatment for saved results. Lifetime policy is the complete protection of insurance. Nothing else.
The Need for Physical Examination and Treatment
If you choose a guaranteed insurance contract, you will not need to be fully tested. This attracts a lot of people. But it is important to ask why insurers are willing to let you pass the test.
After all, if you are suffering from a serious health problem that affects your life, it is reasonable to expect that your insurance company would want to know.
In fact, insurance creates an additional risk to premiums. This is one of the reasons why the guaranteed policy premiums are higher than those covered by the long-term health policy.
A long-term insurance contract requires a medical examination. If you are healthy, you can expect to enjoy very low premiums.
"Savings and Investment" option
As mentioned earlier, lifelong plans include a portion of savings. Part of your premiums are credited to an interest-bearing account; account value builds over time. While plans vary, most insurers will allow the policyholder to borrow money from the savings account.
This sounds like an attractive option at first, but be aware that insurers often pay lower interest rates on savings. Usually, the rate does not compete with those you will find in the bank.
Long-term health policy does not provide this way of saving. Also, it is solidly designed as a insurance protection tool.
Low-Income Premiums Compared
Because of the features included and the guaranteed news policy, the prices are higher than those of a lifetime contract. This is because part of your past savings represent part of your premiums. And, as noted, the absence of medical examinations means a higher level of risk to insurance; risk is built on premiums.
Because long-term life insurance is only intended to provide coverage, consumers often enjoy a higher limit of coverage while paying lower prices.
Simplicity of Comparison Between Policy
Suppose you decide to buy a certified news policy. Comparing insurers separately can be problematic because the key aspects of their contracts may vary. Most important among them is the interest rate used on the savings item.
Although all other variables remain the same, it will still be difficult to compare the store if interest rates are different. And significantly, prices may fluctuate over time. How will you be able to test them?
With a life insurance contract, comparing premiums is easy because the policies themselves are often simple. As a result, you can quickly identify which insurers offer the lowest coverage.
NOW what i wrote is just the working frame it may change but idea will remain same ,so with idea we can easily compare the the life insurance policy in UK.
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