In the world, life insurance has come a long way, enduring a history of hundreds of years and becoming an indispensable part of people's lives in modern countries.
With hundreds of years of establishment and development, life insurance in developed countries has made remarkable achievements and has become indispensable.
In developed countries, most people participate in life insurance because they are aware of the implications that this solution brings. The average person has at least 2 life insurance policies. In particular, in the US, UK, and Japan, the percentage of the population participating in life insurance is over 90%.
Read More: How Does Life Insurance Work?
What Is the Nature of Life Insurance?
Life insurance is not a passbook but a risk protection: Many people are confused between saving and buying life insurance, but they are not interested in the nature of these two types at all. contradictory. You cannot choose both benefits in one. Of course, buying life insurance over the long term will still benefit from the monthly premium, but this is not the main purpose of life insurance providing long-term protection to customers. The purpose of life insurance is to protect the customer against unexpected perils because perhaps now there will be no need for life insurance but there certainly be money for unexpected accidents in life.
Life insurance is a known amount that will support you at an unknown time: Insurance is like a long-term financial bank, which will protect you against unforeseen risks. Risk is something that everyone encounters, and it always surprises me because there is no indication for me in advance when it will happen. That's why I need to have life insurance by my side, at important times of my life, especially when my health declines, I need a large amount of money to ensure I receive special health care., especially at a time when the world is suffering from the Coronavirus pandemic. With insurance accompanying me, I will always be assured because I always have a solid financial channel, even if there is an unexpected accident, I still calmly deal with it.
WHAT IS THE ECONOMIC NATURE OF LIFE INSURANCE?
+ Timely financial protection and support: Risks in life can happen at any time and come with a financial burden. This burden is exacerbated if the person at risk is the breadwinner in the family.
For those who are participating in life insurance, when a risk occurs, the company will pay insurance benefits. This helps participants or their families get practical and timely financial support to overcome difficulties, confidently move on, and be able to continue with future plans. This is also the humanistic meaning that insurance products bring to participants.
Currently, a number of insurance products have integrated savings and investment elements, meaning that after the end of the contract period, participants can receive the principal and interest back. However, participants should also note that the nature of life insurance is not a savings book but protection.
Therefore, if you only care about the profit factor, you can choose to save money in a bank. On the contrary, if the protection factor is put on top, participating in life insurance will be the optimal choice.
+ Not Paid for All Risks: Many people often mistakenly believe that life insurance will pay benefits for all the risks that life insurance participants face. However, the essence of life insurance is to protect only from unexpected risks and is clearly stipulated in the contract.
This means that life insurance will not pay for actions that intentionally cause personal injury, break the law, intentionally take advantage of insurance ... or are outside the scope of the contract. Therefore, before entering into any life insurance policy, you need to research the benefits and terms of that policy before deciding to join this company's life insurance policy. If there are insurance terms or terms that confuse you, ask your counselor immediately for a thorough explanation.
+ Buy Life Insurance Early - The More Beneficial.
After understanding the meaning and nature of life insurance, more and more people are joining and owning multiple policies at the same time. However, in order to receive many benefits, you should join the insurance as soon as possible because.
Conditions of participation are easy.
Stable health is one of the important conditions to participate in life insurance. When we are young, our health is still good, so it is easy to get this condition from insurance companies. Conversely, as you age, your health gradually declines and you are prone to diseases, it becomes more difficult to participate in insurance.
Better fees
Life insurance premiums are highly dependent on the age and health of the participants. As age increases, health will decline, and the risk of illness and disease in old age is unavoidable. Therefore, for the elderly, when participating in insurance, they may be denied or have their benefits restricted as well as have to pay higher fees than younger people. So why not get insurance early, while you are young and healthy to enjoy the best benefits?
More time to accumulate for retirement.
The earlier you get life insurance, the more time you have to accumulate for retirement. Thanks to that, you will not be under financial pressure when you retire, but instead enjoy the days of full joy with your children and grandchildren.
According to data in the period 2000-2020, insurance enterprises have made claims and paid insurance benefits up to several billion USD. As you can see, the nature of life insurance not only brings a lot of benefits to the participants themselves, and their families but also to society. Therefore, you should join insurance as soon as possible to receive many benefits as well as prepare for a comfortable future.
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