Difference between revisions of "Life Insurance Industry in US"

Revision as of 07:13, 2 May 2009

To perform sensitivity analysis and qualitatively determine the variation in monthly premium charged by the life insurance companies.
To understand Life Insurance companies behavior towards the consumers of different gender and belonging to different health groups.

Height and Weight for men and women is taken as the median height and weight prevailing in USA.
Coverage Amount is based on the median annual household income of USA taken as $50,000 and Term duration is assumed as 15 years.

Life Insurance is a contract between the policy owner and the insurer, where the insurer agrees to pay a sum of money upon the occurrence of the insured individual's or individuals' death or other event, such as terminal illness or critical illness.
In return, the policy owner agrees to pay a stipulated amount called a premium at regular intervals or in lump sums.
To be a life policy the insured event must be based upon the lives of the people named in the policy.
Life policies are legal contracts and the terms of the contract describe the limitations of the insured events. Specific exclusions are often written into the contract to limit the liability of the insurer; for example claims relating to suicide, fraud, war, riot and civil commotion.

To make sure their family will be well taken care of if they die.
To minimize tax burden and to ensure whatever they have earned goes to their heirs as it is a tax free way to transfer their wealth.
The value for the policyholder is derived, not from an actual claim event, rather it is the value derived from the 'peace of mind' experienced by the policyholder, due to the negating of adverse financial consequences caused by the death of the Life Assured.
Some insurance policies like Universal life insurance, whole life insurance and some term life insurance can be settled for cash value, the value that can be borrowed against or cashed in when the owner needs money.
To cover post death expenses like funeral, medical bills and to settle debts.

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 * Life policies are legal contracts and the terms of the contract describe the limitations of the insured events. Specific exclusions are often written into the contract to limit the liability of the insurer; for example claims relating to suicide, fraud, war, riot and civil commotion.
 ''Source: http://en.wikipedia.org/wiki/Life_insurance''
+===Why to go for Life Insurance Policy===
+* To make sure their family will be well taken care of if they die.
+* To minimize tax burden and to ensure whatever they have earned goes to their heirs as it is a tax free way to transfer their wealth.
+* The value for the policyholder is derived, not from an actual claim event, rather it is the value derived from the 'peace of mind' experienced by the policyholder, due to the negating of adverse financial consequences caused by the death of the Life Assured.
+* Some insurance policies like Universal life insurance, whole life insurance and some term life insurance can be settled for cash value, the value that can be borrowed against or cashed in when the owner needs money.
+* To cover post death expenses like funeral, medical bills and to settle debts.
+''Source:http://publishmyself.net/home-and-family/seniors-and-elder-care/do-retired-people-seniors-still-need-life-insurance/''