8.0. LIFE INSURANCE
Life insurance usually referred to as “life assurance’ insures the insured against the happening of certain event i.e. death through the time when it may happen is uncertain. It is a civilized world’s solution to the problems caused by death. The event insured against is usually a tragic one, one that causes damage and loss of life to the policy holder. The service takes place in tragic circumstance and it helps to relieve the impact of the tragedy, partly, not wholly to the family members/nominees of the policy holder. The service is thus intrinsically satisfying, its infinite potential to give cheer ad happiness, is often flawed by the rigidities of procedure.
Section 2 of the Indian insurance Act, 1938 has defined life …show more content…
It relieves the insured from the sword of Damocles i.e. various risks and uncertainties which may occur before and after the death of the insured.
8.2. Nature of Insurance
On the basis of present day economic environment, there are few basic needs for which life insurance is needed. The life insurance is concerned with the hazards that stand across the life of every person that is dying prematurely leaving dependent and that of living to old age without visible means of support.
8.3. Family protection
To protect the families from the economic hardship after the death of the breadwinner member of the family
8.4. Investment of savings
Savings provide the new source of income when permanent earning stops and Life assurance provide an immediate source of income for one’s family on the death of an insured person prematurely.
8.5. Additional way of earnings
It provides an insured additional earning by way of bonus and interest credited by the Life insurance Corporation.
8.6 Helpful at the time cessation of earnings
Life assurance is needed because when one ceases to earn money, insurer provides certain sum of money to the insured as per various terms of policies.
9.0 PRINCIPLES AND ADVANTAGES OF LIFE INSURANCE
The insurance contract