world, it becomes the onus for the head of the family to provide social and economic security for his or her family. Our expenses, no matter how much we try, increase with the passage of time. Middle class takes the brunt in the event of unexpected happenings leading to injury or death of head of the family- sole earning member. In either of the events, it becomes very difficult for the family to cope up both emotionally and financially.

Financial security of the family in such events helps them to cope emotionally to a great extent.

Insurance policy is one such social device which helps provide such financial security to the family.

Life Insurance in simple words is an evaluation of a mans worth at any futuristic timeframe and in the event of the unexpected demise/injury to the insurer, it is immediately translated in terms of financial security or cash benefit for the dependents thus alleviating at least financial worries.

Financial viability of the Insurance companies :

Life Insurance cover is provided by various private/ government agencies the world over. Customer has a wide choice of the companies as well as the various short and long term plans that he/ she can opt for. It is important for the customer to ensure that the company from which he or she is purchasing the life

insurance plan has sound financial background and market credibility.

Types of Plans/Policies :

Insurance companies have wide range of plans catering to all class/ strata of society. There are two types of basic life insurance plans.

1. Term Plan

2. Endowment plan

Term plans have comparatively low premium and large sum assured. The dependent/ beneficiary get the lump sum in the event of the death of the insured person only. In case of survival, some companies may return the premiums paid without interest. This type of insurance is especially suitable for persons who travel a lot.

Endowment plans, on the other hand, are normally flexi in nature. The plans can be had from one year to 25 years and some companies might provide cover for larger period. Such type of policy/plans, incorporate various types of special packages or riders which one can have by paying slightly more premium. These may include accident benefits, critical illnesses cost, existing the disability or congenital illness etc. The person can opt for annuity or pension whereby at maturity, he gets certain amount as pension for the rest of his life.

In endowment plans, the insured person has the benefit of getting the matured amount at the end of the policy period which is nearly double the sum assured! This happen due to the accrued interest paid by the company along with the sum assured for. In case of death or accident the dependents get sum assured along with interest till the time of death.

Points to Remember while Buying Policy:

1. It is important that the person taking the policy discloses all the facts relating to his health and family and social background so that, in the event of his death or accident, his dependents do not face difficulties in getting the money due to them. This is also a safeguard for the insurance companies against deliberate fraud by the insured which might lead to financial loss for the insurer (insurance company) as the withheld information might become the cause for the death of the insured.

2. Ensure that the company has financial stability and credibility.

3. Read the indemnity bond carefully and clarify all your doubts

4. After buying, make sure that premiums are paid on time and all the receipts and certificates kept safely

Benefits:

Life insurance is not only a financial security for the family but it has great investment potential also. Most governments, the world over, provide tax benefits to the individual holding life insurance plans. The maturity amount that one gets at the end of the plan includes substantial amount as interest accrued over the period and paid by the company.

Certain life insurance plans accumulate cash values which may be taken if the policy holder surrenders it or he can avail loan against the said amount as and when the need arises.

Over and above all, the insured, in case of survival, enjoys a good financial status during his retirement days!