Lesson 7 Part 2 - Lesson7(2): LifeInsurancePolicies...

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Lesson 7 (2): Life Insurance Policies
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2 What is Life Insurance? Simply stated - The main purpose of life  insurance is to pay dollars when the  insured dies The transaction requires: The pooling of exposures Financing (advance funding)
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3 Ways Life Insurance Is  Distributed Group Life and Credit Life Industrial Life (debit or home service  life ) Small amount insurance For low income workers Cost is high Individual Life aka ordonary life insurance
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4 Parties to the Life Insurance  Contract Insurance Company – the organization promising to pay the  face amount of the contract or death benefit when the insured  dies. Insured – the insured is the object of the insurance whose death  causes the insurer to pay a death claim. Policy owner – the policy owner owns and controls the contract  rights in the contract. Often the policy owner is the same as the  insured. Beneficiary – the beneficiary is the person(s) identified to  receive the death benefit when the insured dies.  The beneficiary only has a contingent right. The beneficiary will 
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This note was uploaded on 10/08/2011 for the course FINANCE FINANCE taught by Professor Don'tknow during the Spring '09 term at American Internation College.

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Lesson 7 Part 2 - Lesson7(2): LifeInsurancePolicies...

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