General Life Insurance: The Basics

General Life insurance is the basic package of life insurance. The contract is between the policy owner and the insurance company. Every life insurance company has terms and conditions that you must meet to stay insured with the company. The Insurance Company will pay the beneficiary if the person insured dies, but the insured person has a payment to make. There are two different types of deaths that the insurance will cover; they include Accidental death, and natural death.  The only thing is that General Life insurance is not without some problems that could be bad for us. They have exclusions that stop coverage if or when any of the following events happen: Suicide, fraud, war, riot and civil commotion. When it comes to general life insurance there are two main categories that it is split into, the first on of these are protection policies, these are made to share benefits in a specified event. The other one is Investment policies, the object is to show the growth of the capital by regular or single payments. Insurance is not just between the company and the customer, there is a third person in the mix as well. They are the owner, the insured, and the company. Many times the first and second parties are one and the same.

If you buy a policy for let’s say your wife you are the owner and she is the insured. The insured person if they are in a three party contract may not have to pay for the insurance the owner has to pay for it. Some people even think of the insured person is not even a party on the contract at all. The beneficiary is person who receives the policy payment when the insured person’s death. The beneficiary is designated by the policy owner. They can change the person they chose as beneficiary unless otherwise stated on your contract. The current beneficiary must agree with their Policy changes or any other activities like borrowing cash. When the person who is insured dies, they need proof of the death to pay the claim. Unless something happens during the process, but that is very rare. If they rule the death suspicious because the amount is large they will investigate before they decided whether or not to pay the claim. The best benefit is the knowledge that your family is safe no matter what happens.